Business in Honduras

EENI- School of International Business

Subject: Doing Business in Honduras - Tegucigalpa. Syllabus:

1. Introduction to the Republic of Honduras (Central America)
2. The Honduran Economy
3. International Trade of Honduras
4. The Foreign Direct Investment (FDI) in Honduras
5. Doing Business in Tegucigalpa and San Pedro de Sula
6. Case Study: Business Opportunities in Honduras
   1. Manufacturing
   2. Textile
   3. Agribusiness
   4. Services
7. Access to the Honduran Market
8. Business Plan for Honduras

The objectives of the subject “Foreign Trade and Doing Business in the Republic of Honduras” are the following:

1. To analyse the Honduran economy and foreign trade
2. To evaluate the business opportunities in the Republic of Honduras
3. To explore Honduras' trade relations with the country of the student
4. To know Honduras' Free Trade Agreements
5. To develop a business plan for the Honduran Market

Sample of the subject - Doing Business in Honduras

Description of the Subject: Foreign Trade and business in Honduras.

The Republic of Honduras.

1. Since 1980 Honduras is governed by a democratic system with steady institutions, a transparent legal system, and political and social stability .
2. Honduras is situated in the heart of the American continent. Only two hours by air and 48 to 72 hours by sea to the United States
3. Honduras has a population of 8.7 millions of people
4. Capital: Tegucigalpa
5. Area: 112,492 square kilometres
6. Honduras shares borders with Guatemala, El Salvador, and Nicaragua
7. The main language: Spanish
8. The main religion in Honduras: Christianity - Catholicism (7 million) and Protestantism (1 million)
9. Honduras belongs to the Latin American area of the Western Civilisation
10. Honduras gained independence from Spain in 1821
11. Abolition of the slavery in Honduras: 1824
12. African Diaspora in Honduras: 0.1 millions of people (2% of the Honduran population)

The Honduran Economy.

1. The Republic of Honduras is an interesting place to do business in Central America
2. Honduras is near the production centres of North America and the largests markets in the World
3. In the last years, 300 companies have established their operations in the Republic of Honduras (America) under “maquila” - (manufacturing and light assembly) in sectors such as textile and apparel, agro-industry, automotive components, electronics, and furniture production,
4. Honduras is the hub of the Central American garment industry
5. Honduras serves as a distribution platform to the regional markets of Central America, among the lowest logistical costs in the region
6. The main Honduran economic activities are the financial services, communications, manufacturing, trade, agriculture, livestock, forestry, and fisheries
7. The agribusiness represents 40% of the GDP of Honduras
8. The Honduran Currency: Lempira

The Emerging Sectors in Honduras:

1. Traditional sectors (agriculture, textiles, tourism)
2. Value-added industries (agribusiness, sustainable tourism, light manufacturing, and business services)
3. A flexible manufacturing sector, capable of exporting in varying scales, supported by a favourable tax and customs code
4. A growing services sector
5. A tourism sector that attracts international travellers
6. A forestry industry that supplies a broad variety of non-traditional wood species 32 million hectares (80 million acres) at highly competitive prices, with different climates and a large potential for low irrigation agriculture

The main business opportunities in Honduras:

1. Traditional sectors: agriculture, textiles, and tourism
2. Value-added industries: agribusiness, sustainable tourism, light manufacturing, and business services

The Foreign Trade of Honduras.

1. The exports of the Republic of Honduras are led by the activities related to the maquilas
2. The total Honduran exports grew by 7.2%.
3. Honduras is the third largest exporter of apparel to the US market
4. The main markets of the Honduran exports are the United States, the European Union, El Salvador, Guatemala, and Mexico
5. The largest importers of Honduras are the United States, Guatemala, El Salvador, the European Union, and Costa Rica
6. Puerto Cortés is the only deep-water port in Central America; is engaged (busiest) among the Honduran and the Central American ports
7. The construction of the Inter-oceanic Highway will allow the communication by road between the Atlantic and the Pacific oceans
8. The laws that protect and to promote the foreign direct investment provide to the export-oriented companies fiscal and legal incentives highly favourable to the investment
9. Any part of Honduras can be an Industrial Processing Zone/Free Zone where companies are exempt from all taxes

FIDE Investment and exports is a Honduran private non-profit organisation that works in partnership with the Government and other private agencies to improve the business climate in Honduras and to promote the foreign direct investment (FDI).

Honduras' Free Trade Agreements (FTA) and Market Access

1. Central American Integration System (SICA)
2. Central American Common Market - Integrated with the SICA -
3. The Honduran products and services has direct access to many international markets thanks to the Trade Agreements with the United States, Canada, Colombia, Panama, Central America, the Dominican Republic, Mexico, Japan, the European Union, Taiwan, Chile, or Australia
4. Association of the Caribbean States (ACS)
5. Mesoamerica Project

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