Honduras: A Country on the Brink of Bankruptcy
There is an abundance of signs of deterioration of the Honduran state, where the fiscal crisis and the political crisis are feeding off each other.
Friday, January 25, 2013
Roberto Arce's article for AP, published in Laprensa.hn, reviews the events that mark the depth of the institutional crisis, with cessation of salary payments to civil servants and an external public debt which has once again reached $5 billion, after international multilateral banks waived $3.5 billion in 2007.
One of the reasons for the poor performance of the Salvadoran economy is the uncertainty about political behavior at every election.
The country's economy, which has not yet recovered from the crisis of 2008, will suffer from a deficit for which the government can not find effective solutions.
The National Association of Private Enterprise is warning of an accelerating deterioration of competitiveness and an unprecedented fiscal crisis.
Gradual increase in exchange rate flexibility, supported by fiscal consolidation, wage moderation, and a prudent monetary policy.
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