Honduras : Investment Climate Assessment, Volume 2. Main Report
The 21st century reality is that Honduras does not compete only with its Central American and Latin neighbors. Thanks to the ongoing Central American Free Trade Agreements (CAFTA) negotiations, the country will have the opportunity to accelerate th...
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| Format: | Investment Climate Assessment (ICA) |
| Language: | English en_US |
| Published: |
Washington, DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2004/11/6316536/honduras-investment-climate-assessment-vol-2-2-main-report http://hdl.handle.net/10986/14556 |
| Summary: | The 21st century reality is that
Honduras does not compete only with its Central American and
Latin neighbors. Thanks to the ongoing Central American Free
Trade Agreements (CAFTA) negotiations, the country will have
the opportunity to accelerate the pace of its integration
into the global economy. Improving the investment climate is
essential for Honduras to take advantage of the
opportunities provided by CAFTA, attract foreign investment,
diversify exports and increase growth. This report
identifies the critical constraints on private sector
productivity and growth in Honduras, and provides policy
recommendations for addressing them, including a summary of
the Government's ongoing and planned initiatives and
some additional suggestions. The diagnostic is based on the
results of a survey of a stratified sample of 450 Honduran
manufacturing firms. The report focuses on four key areas of
the investment climate: (1) governance, (2) infrastructure,
(3) innovation, quality certification and labor skills; and
(4) finance. Overall results of the ICS and of an
econometric analysis based on the results of the survey show
that bottlenecks in all four investment climate variables
increase Honduran firms' costs of doing business and
reduce their productivity. The first chapter presents on
overview of the structure of the Honduran economy, while
each of the other four chapters analyzes the findings of the
Investment Climate Survey and provides policy
recommendations in one of the four areas of the investment
climate. Constant Government progress to reduce constraints
on economic growth, as well as firms' dynamic pursuit
of new markets and innovation, are both essential in order
for the country to take advantage of the opportunities
offered by the new trade agreements, improve growth, and
fulfill social expectations. Improving the investment
climate in Honduras will require cross sector strategies and
actions geared towards aligning economic policy, public
management, infrastructure, technology, foreign direct
investment (FDI), innovation, training and finance policies. |
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