Honduran Economy is Still Recovering

After in January 2021 in the context of the crisis caused by the pandemic, the Monthly Index of Economic Activity at the national level reported a 6% decrease in year on year terms, in February a smaller drop was registered, amounting to 3.5%.

Monday, April 19, 2021

The drop recorded in February continues to reflect the negative effects of the Covid-19 pandemic and the damage caused by the tropical storms of November 2020, affecting the evolution of most economic activities, mainly in "... Agriculture, Livestock, Forestry and Fishing; Manufacturing Industry; Transportation and Storage; Hotels and Restaurants; Commerce; and Private Construction; these contractions have been partially offset by the boost in the services of Mail and Telecommunications and Financial Intermediation", informed the Central Bank of Honduras (BCH).

Check out the "System for monitoring markets and economic situation in the countries of Central America", prepared by CentralAmericaData.

The document states that "... Agriculture, Livestock, Forestry and Fishing, reflected a reduction of 11.5% as of February 2021 (-3.5% in the same period of the previous year), as a result of the aftermath left by tropical storms in November 2020 in agricultural crops of melons and watermelons, sugar cane, African palm cultivation; bananas, basic grains and coffee; causing losses and delays in the harvest, as well as landslides in farms that were starting the productive process."

"The Manufacturing Industry presented a 6.5% negative variation (5.4% growth in the same period of the previous year), mainly explained by the reduction in the manufacture of Food, Beverages and Tobacco; Textile Products and Apparel; and to a lesser extent, Paper Products and Publishing Printers; and Substances, Chemical Products and Plastics", adds the official report.

More on this topic

Honduran Economic Activity Falls 9% in 2020

February 2021

At the end of last year, the Monthly Index of Economic Activity reported a -8.5% year-on-year variation, a drop that is explained by the negative effects generated by the outbreak of covid-19 and tropical storms Iota and Eta.

The national production of goods and services in terms of volume, showed a contraction in the accumulated variation rate of 8.5% (increase of 3.1% in 2019), mainly explained by the negative effects of the Covid-19 pandemic on economic activity and demand, added to the impact of tropical storms Eta and Iota on agricultural crops, some industries and productive infrastructure, mainly in the northern part of the country, says an official report.

Economic Recovery: Honduras Retreats

January 2021

As a result of the pandemic in May 2020, the IMAE hit bottom by falling 22% year-on-year, but from June onwards, smaller falls began to be reported and in October the decline was barely 1%; however, in November the country fell back by 12%.

National production, measured through the original series of the Monthly Index of Economic Activity (IMAE), reflected a 12% year-on-year decrease in November 2020, determined by the negative impact of the pandemic, to which was added the losses in production due to the flooding caused in the national territory in the first half of November by the occurrence of tropical storms Eta and Iota.

Guatemalan Economy Recovers Quickly

November 2020

After dropping in May 2020 due to the outbreak of covid-19, then registering a -11% year-on-year variation, since then the economic activity index has been recovering quickly, reporting a reduction of only 0.3% in September.

The 0.3% decline in the Monthly Index of Economic Activity (IMAE) was influenced by the drop recorded in Accommodation and food service activities, Construction, Trade and vehicle repair, Transportation and storage, as well as by the growth observed in Manufacturing industries; Supply of electricity, water and sanitation services, and, Agriculture, livestock, forestry and fishing.

Which Economies Have Recovered the Most?

October 2020

As of June, Central American economies began to show signs of incipient recovery and as of August, Guatemala, Nicaragua and Costa Rica registered the smallest drops in their levels of economic activity.

Since March of this year, the region has faced a severe economic crisis generated by the outbreak of covid-19.