Honduras Fiscal Policies
Sources: The Library of Congress Country Studies; CIA World Factbook
Throughout the 1960s and most of the 1970s, the military-led governments of Honduras ran a state-sponsored and state-financed economy. The governments provided most guarantees for loans to a strong but patronage-dominated and somewhat corrupt public sector that included recipients of graft extracted from foreign and domestic investors, and to costly state-developed enterprises. By 1989 and the election of President Callejas, however, a heavy toll had been taken by regionwide economic recession, civil war in neighboring countries, the drying up of most external credit, and capital flight equaling more than US$1.5 billion. Callejas began to shift economic policy toward privatizing government-owned enterprises, liberalizing trade and tariff regulations, and encouraging increased foreign investment through tax and other incentives. The Callejas administration did not seek less government control. Rather it changed the government's objectives by focusing on reducing public-sector spending, the size of the public-sector work force, and the trade deficit. Overall economic planning became the responsibility of the National Superior Planning Council, directed by the minister of economy and commerce. President Callejas, a United States-trained economist, brought new professionalism and technical skills to the central government as he began the arduous task of long-term economic reform.
Data as of December 1993
NOTE: The information regarding Honduras on this page is re-published from The Library of Congress Country Studies and the CIA World Factbook. No claims are made regarding the accuracy of Honduras Fiscal Policies information contained here. All suggestions for corrections of any errors about Honduras Fiscal Policies should be addressed to the Library of Congress and the CIA.