Honduras: Request for a Stand-By Arrangement and an Arrangement Under the Standby Credit Facility

International Monetary Fund

No 2014/361, IMF Staff Country Reports from International Monetary Fund

Abstract: The government of President Hernandez inherited a difficult macroeconomic situation upon taking office in January 2014. Economic growth decelerated significantly in 2013, driven mainly by lower private demand from policy uncertainty and by weaker trade-partner growth. The fiscal accounts weakened considerably in 2011–13, reflecting sizeable increases in government spending and in the deficit of the state-owned electricity company. The relaxation of fiscal policy has led to a rapid increase in public debt, which would continue into the medium term absent a change in economic policies. The balance of payments position has also weakened over the last three years, reflecting both expansionary macroeconomic policies and a less favorable terms of trade.

Keywords: ISCR; CR; government; IMF quota; deficit; CDCDCD; sound monetary policy; recovering coffee sector; support Honduras; IFC financing; central bank; Honduran authorities; SCF arrangement; Public sector; Fiscal consolidation; Central America; Global; Europe (search for similar items in EconPapers)
Pages: 94
Date: 2014-12-24
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