Tegucigalpa, Honduras:
An International Monetary Fund (IMF) team led by Joyce Wong and supported
by resident representative Christian Henn visited Tegucigalpa, Honduras, on
June 20-24, 2022 to deepen discussions on the authorities’ vision and their
policy priorities. At the conclusion of the visit, Ms. Wong issued the
following statement:
“The team discussed with the authorities recent economic developments and
the outlook for Honduras. Despite a strong rebound in economic activity,
employment remains below pre-pandemic levels. High and rising inflation,
driven by commodity prices and subsequent economic shocks amid strong
remittances, is exposing the most vulnerable Hondurans.
“In the face of these challenges, the team discussed with the authorities
their policy priorities within their social program, which they would like
to be supported by deeper engagement with the Fund. The authorities
emphasized the priority to reduce poverty, protect the most vulnerable, and
foster inclusive growth. They also plan to tackle corruption and strengthen
governance and transparency, including by improving public financial
management. To this end, they have passed legislation to eliminate trust
funds and are in the process of reviewing tax exemptions to make the tax
system more equitable. This would create fiscal space to boost much-needed
investment and support social spending.
“The authorities reiterated their commitment to honor the country’s debts
and to maintain debt sustainability. They are improving debt management
with international assistance and aim to gradually improve the debt service
profile. The government highlighted the importance of implementing energy
reforms to improve the functioning of the national electricity company
(ENEE) and the electricity sector.
“The IMF team would like to thank the authorities for their kind
hospitality and candid discussions.”