U.S.-HONDURAS RELATIONS

Honduras has traditionally been an ally of the United States. Our policy in Honduras is focused on strengthening democratic governance, including the promotion of human rights and the rule of law, enhancing economic prosperity, and improving the long-term security situation in the country. U.S. Government programs are aimed at promoting a healthy and more open economy capable of sustainable growth, improving the climate for business and investment, protecting U.S. citizen and corporate rights, and promoting the well-being and security of the Honduran people.

The United States works with Honduras to meet transnational challenges--including the fight against terrorism, narcotics trafficking, money laundering, illegal migration, and trafficking in persons--and encourages and supports Honduran efforts to protect the environment.

The goals of strengthening democracy and promoting viable economic growth are especially important given the geographical proximity of Honduras to the United States. An estimated 1 million Hondurans reside in the United States, 600,000 of whom are believed to be undocumented; consequently, immigration issues are an important item on the bilateral agenda. An average of 800,000 U.S. citizens visit Honduras annually, including those who visit the island of Roatan on cruises, and about 22,000 Americans reside there.

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U.S. Assistance to Honduras

Honduras, one of Latin America's poorest nations, strives to improve its economic and democratic development with U.S. assistance. The United States has historically been the largest bilateral donor to Honduras. U.S. Agency for International Development (USAID) programs target a variety of issues including education, health, economic policy, micro-enterprise, environmental conservation, food security, municipal development, and justice sector reform.

The United States maintains a small presence at a Honduran military base. U.S. forces conduct and provide logistics support for a variety of bilateral and multilateral exercises--medical, engineering, peacekeeping, counter narcotics, and disaster relief--for the benefit of the Honduran people and their Central American neighbors.

Through the Central America Regional Security Initiative, the United States supports the Government of Honduras by assisting law enforcement entities in disrupting criminal networks; building investigative, prosecutorial, and judicial capacity; and implementing violence prevention programs for vulnerable communities.

In June 2005, Honduras became the first country in the hemisphere to sign a Millennium Challenge Corporation (MCC) Compact with the U.S. Government. Under the Compact, the U.S. Millennium Challenge Corporation invested $205 million over 5 years to help Honduras improve its road infrastructure, diversify its agriculture, and transport its products to market. In 2013, Honduras received a $15.6 million MCC Threshold Agreement to support Honduran efforts to improve public financial management and create more effective and transparent public-private partnerships.

Bilateral Economic Relations

The U.S. is the chief trading partner for Honduras. Bilateral trade between the two nations totaled $9.8 billion in 2013. U.S. goods to Honduras fell slightly to $5.3 billion in 2013, after totaling $5.7 billion in 2012. The United States imported $4.5 billion of goods from Honduras in 2013.

The U.S.-Central America Free Trade Agreement (CAFTA-DR) entered into force in 2006. It eliminates most tariffs and other barriers for U.S. goods destined for the Central American market, provides protection for U.S. investments and intellectual property, and creates more transparent rules and procedures for conducting business.

​CAFTA also aims to eliminate intra-Central American tariffs and facilitate increased regional trade, benefiting U.S. companies manufacturing in Honduras. With CAFTA implemented, about 80% of U.S. goods now enter the region duty-free, with tariffs on the remaining 20% to be phased out by 2016.

Leading U.S. exports include petroleum products, textile and fabrics, cotton yarn, electrical equipment, chemicals, manmade staple fibers, computer and electronic products, machinery, food products and cereals (corn, wheat, rice). Nearly all textile and apparel goods that meet CAFTA-DR’s rules of origin became duty-free and quota-free immediately, offering opportunities for U.S. fiber, yarn, fabric, and apparel manufacturers.

According to the U.S. Department of Commerce/Bureau of Economic Analysis, the stock of U.S. investment in Honduras was $881 million in 2012, compared to $821 million in 2011. This was concentrated largely in the manufacturing (maquila) and wholesale trade sectors.