Caribbean & Central America - November 2014 (ISSN 1741-4458)

President Juan Orlando Hernández on 23 October sanctioned a legislative decree introducing life imprisonment sentences for the assassination of members of the executive, the national congress and the judiciary, warning that anyone attacking “the operators of justice” would “pay with the denial of their freedom for the better part of their lives”.

The move comes amid growing fears that many parts of the Honduran state, from local and regional authorities all the way up to government agencies, as well as the security forces and the judiciary have either been captured, or are severely threatened, by narco elements and organised crime. The extent of alleged corruption in the national police prompted a big push on police reform by the last government led by President Porfirio Lobo (2010-2014). Those efforts were severely hampered by resistance from within the force itself (and were also questioned by the supreme court) and the results to date appear mixed at best. The US-based NGO Human Rights Watch (HRW) notes that “the institutions responsible for providing public security continue to prove largely ineffective and remain marred by corruption and abuse, while efforts to reform them have made little progress”.

The judiciary is another institution struggling to cope with the difficult security situation in the country. While the judiciary more often than not is tarred by critics as ineffective and corrupt - “Perpetrators of killings and other violent crimes are rarely brought to justice” - notes HRW, the reality is that there is not much by way of incentive for Honduran judges to stick their necks out in the name of the law. On 24 October the Asociación de Jueces por la Democracia y la de Fiscales de Honduras issued a statement calling on the authorities to clarify the assassinations of 84 judicial workers, including judges and lawyers, since 2010 (on figures from the state’s human rights commissioner). The group made the statement following the abduction and murder of a former justice of the peace and public defender, Iris Argueta, in Catacamas (Olancho) the previous day (23 October). Another two judges (named by the press as Marlen Banegas and Patricia Eufragio) were shot dead on 11 October in San Pedro Sula, for which four people have been detained, according to local media. Notwithstanding the president’s day-earlier decree, the statement called for preventative measures including stiffer sentences for crimes against judicial workers and a strengthening of criminal investigations.

Fresh ink on IMF deal

The government finally has inked a new agreement with the International Monetary Fund (IMF) that should give it access to upwards of US$200m in new financing as of 10 November, likely under a new Stand-By Arrangement (SBA). In a statement following its last country visit in September, the Fund said it had begun discussions on a three-year programme, aiming to “preserve macroeconomic stability in Honduras, while improving conditions for sustainable economic growth and supporting efforts to reduce poverty in a fiscally affordable manner.”

Details are not yet available but President Hernández said the funds would go partly towards this year’s budget to help reduce an estimated fiscal deficit of 8% of GDP. According to the IMF’s latest World Economic Outlook (WEO), Honduras will post real annual GDP growth of 3.0% on average between 2015 and 2019, with average inflation easing from about 6% this year to 5% by 2019. Unemployment is pencilled in at 4.5% on average through to 2019.

Ambitiously, the Fund has the fiscal deficit falling from 8.0% to 4.0% in the same period, with the current account deficit falling from 8.0% this year to 6.5% by 2019. In just four years, and without sustained US growth to kick-start Honduran exports, for instance, that is a tall order. Finally, total general government gross debt will hit 57.6% of GDP by 2019, however the country should have more access to external financing with an SBA in place.

Narco mayors

Marvin Ponce, an outspoken former left-wing deputy who is currently an adviser to President Juan Orlando Hernández, has been summoned by the Dirección de Lucha contra el Narcotráfico (DLCN) after he declared in an interview that there were “at least six narco mayors” (‘narco alcaldes’) within 100km of Tegucigalpa. Ponce suggested that at least 35 municipal workers in these areas had been linked to organised crime, and said he knew of eight mayors under investigation, along with “various deputies and seven businessmen who use their positions to launder money”. The DLCN said it would ask Ponce for evidence.