Honduras country brief

Overview

Australia and Honduras enjoy warm relations, based on trade, investment and cooperation on a range of international issues, including the environment, agricultural development, climate change, transnational crime and disarmament.

The two countries established diplomatic relations in 1984, when Australia’s first Ambassador to Honduras, Cavan Hogue, presented credentials. The Australian Embassy in Mexico City, is accredited concurrently to Honduras. Australia has an Honorary Consul in Tegucigalpa.

Honduras is situated in the centre of the Central American isthmus with both Caribbean and Pacific coastlines. It shares borders with Nicaragua in the south and El Salvador and Guatemala in the north. Honduras, El Salvador and Nicaragua share a coastline along the Gulf of Fonseca, a closed sea under international law. Honduras’ climate is subtropical in the lowlands and temperate in the mountains.

Honduras’ population is approximately 8.9 million (2016 est). Roman Catholicism is the main religion with around 97 per cent of the population identifying as Catholic. Spanish is the official language of Honduras.

Political overview

During the first millennium, Honduras was inhabited by a number of indigenous tribes, predominantly the Maya who built their sacred metropolis, Copán, in western Honduras and whose civilization stretched to what is now the Yucatan in Mexico.

Explored and settled by the Spanish in the 16th century, Honduras broke with Spain in 1821 and joined the First Mexican Empire. It was part of the United Provinces of Central America until 1838 when it broke away and became an independent state. In the first decades of the twentieth century, the US made regular military incursions. As the country was effectively controlled by American fruit corporations, it was the original inspiration for the term “banana republic”. After two and a half decades of mostly military rule, a freely elected civilian government came to power in 1982. During the 1980s, Honduras was used as a base by anti-Sandinista contras fighting the Nicaraguan Government and an ally to Salvadoran Government forces fighting leftist guerillas. In October 1998, Hurricane Mitch devastated Honduras, leaving more than 5000 people dead and 1.5 million displaced.

System of Government

Honduras has a democratically elected representative government with a strong executive. The President, who is the head of state and government, is elected by a simple majority for a single four-year term. Honduras has a unicameral National Congress with 128 seats with members elected in multi-seat constituencies by proportional representation for four-year terms.

Recent developments

President Juan Orlando Hernández was elected on 24 November 2013. The next election is scheduled to be held in November 2017. President Hernández is expected to stand for re-election.

Foreign Policy

Honduras is a member of the Organisation of American States, the Community of Latin American and Caribbean States (CELAC) and the Central American Integration System (SICA). It is a member of Petro Caribe and an observer of the Pacific Alliance.

Honduras has requested an extension to the US government's Temporary Protected Status (TPS) programme, which is of great economic and social importance for Honduras. Launched in the 1990s, it allows immigrants who are temporarily unable to return home, due to violence, environmental disasters or other extraordinary circumstances, to live and work legally in the United States. Hondurans have benefitted from TPS since 1998, when a large cohort was admitted following the devastation caused by Hurricane Mitch. There are currently 60,000 Hondurans in the programme. In total, Hondurans in the US send home around US$4bn a year in remittances (equivalent to around one-fifth of GDP).

Honduras is one of the three countries (along with El Salvador and Guatemala) which make up the "Northern Triangle" and benefits from a multi-year US development and security aid package, known as the Alliance for Prosperity, approved in November 2014.

Honduras recognises Taiwan as the Republic of China.

Bilateral Relations

Australia and Honduras both participate in the Forum for East Asia-Latin America Cooperation (FEALAC). Australia is an observer of SICA.

In 2001, the Australian Government established the Council on Australia-Latin America Relations (COALAR) which aims to enhance commercial, political and cultural relations between Australia and Latin America. Since its inception, COALAR has been active in promoting business, education, tourism and cultural links between Australia and Latin America. For updates on COALAR activities and information on the annual grants program, follow COALAR on Facebook.

People to people links

Around 2300 Australians visit Honduras annually.

Hondurans are eligible to apply for Australia’s Endeavour Awards Scholarships and Fellowships. The program opens annually in April and closes in June.

Development assistance

Since 2010, Honduras has been eligible to receive Australia Award Fellowships but none have been granted to date.

From 2010 to 2014, Australia provided $100 million in official development assistance to Latin America, including 250 Australia Awards scholarships. Honduras received 17 Australia Awards Scholarships. The regional program has now closed, though some activities that have already been funded will continue until 2018.

The Australian Embassy in Mexico City manages a Direct Aid Program (DAP), which can provide financial support to a broad range of projects in Honduras. In 2016-2017, DAP is funding one project in Honduras, focused on increasing women’s participation in politics. The project is run by the Inter-American Institute of Human Rights based in Costa Rica and it is also currently implemented in Guatemala.

Economic overview

For latest economic data refer to Honduras [PDF 31 KB]

Economic and trade policy directions

Honduras, the second poorest country in Central America, suffers from unequal distribution of income, as well as high underemployment. While historically dependent on the export of bananas and coffee, Honduras has diversified its export base to include apparel and automobile wire harnessing.

Following a meeting on 22 May 2017 in Tegucigalpa, the Honduran capital, between the Guatemalan president, Jimmy Morales, and the Honduran president, Juan Orlando Hernández, a customs union between the two countries started to be implemented in June 2017. Honduras hopes El Salvador will join the Customs Union.

In January a free-trade agreement came into effect between Honduras and Peru, designed to boost bilateral trade from its currently low level of less than US$100m. There are also hopes of increased trade with Taiwan.

Honduras, collectively with Central America and the Dominican Republic, has FTAs with the United States (since 2009) and the European Union (since 2012).

Economic outlook

Honduras’ economy is expected to continue to grow around 3.5 per cent in coming years. Inflation is expected to remain relatively stable.

Trade and Investment

Economic and trade relationship

In 2016, Australia’s trade with Honduras was around $29 million, mostly imports of coffee ($14.6 million) and clothing ($8.6 million). Three Australian companies currently operate in Honduras.

Export opportunities

Despite the modest nature of two-way trade, Australian companies are taking advantage of niche opportunities to provide professional services throughout the region. The Australian Government, through our post in Mexico City and our Austrade representation there, helps raise the profile of Australian companies and ensures that Australian businesses and exporters are well positioned to make the most of emerging opportunities. Australia’s Honorary Consul in Tegucigalpa also assists the Australian Embassy in Mexico to identify commercial opportunities in Honduras.

High level visits

February 2017: Special Envoy for Human Rights, the Hon Philip Ruddock MP, visited Honduras.

August 1985: Honduran Foreign Minister Dr Edgardo Paz Barnica visited Australia.

September 1984: Foreign Minister Bill Hayden visited Honduras.

Last Updated: July 2017


Last Updated: 6 July 2017