Honduras crisis hits regional trade hard

By Alberto Najar
BBC Mundo

Lorries carrying goods have been held at the Honduran border

The political crisis in Honduras is having a crippling effect on trade in Central America, with Guatemala, El Salvador and Costa Rica losing millions of dollars of trade every day.

Because of its geographical position, practically all goods traded in the region have to pass through Honduran territory.

But their flow has been hampered, especially since the return to Honduras last week of ousted President Manuel Zelaya and the imposition of a nationwide curfew, which still has not been completely lifted.

At the height of the political turmoil last week, the interim government of Roberto Micheletti also closed the country's borders and shut airports.

Those restrictions have now been lifted but an emergency decree suspending civil liberties remains in place.

Neighbouring countries say the political instability in Honduras has caused major disruption to trade and is seriously affecting exports.

Lost trade

"It's untenable," the director of the Costa Rican Chamber of Foreign Commerce, Fernando Monge, tells BBC Mundo.

When the border is closed, our trade with Honduras, Costa Rica, Nicaragua and Panama is affected Javier Zepeda Guatemalan Chamber of Commerce

"We've asked governments, especially Honduras, to clarify the situation, for everyone's good. We can't go on like this much longer."

Losses have been reported in the food and clothing sectors, as well as plastics and household goods.

Passenger transport has also been affected.

Several bus companies in El Salvador, Nicaragua and Guatemala have suspended their routes to Honduran cities because of road closures during the curfew.

Guatemala

The ongoing political deadlock in Honduras has come at a high price for Guatemalan businesses.

Javier Zepeda, president of the country's Chamber of Industry, says: "When the border is closed, our trade with Honduras, Costa Rica, Nicaragua and Panama is affected, because we can only go via El Salvador."

Honduras is Guatemala's third largest trade partner, and it is estimated that the curfew in Honduras costs Guatemalan businesses almost $8m (£5m) a day.

And that's not all. Dozens of commercial contracts have failed to be met, and hundreds of people working in companies within the border zones have stopped turning up to work because of the recent border closures.

"The current siege situation limits workers' mobility and affects trade," explains Mr Zepeda.

As in the rest of Central America, the biggest casualty has been trade in basic foodstuff, especially milk products, which go off because they cannot be transported across the border quickly.

It is yet another blow for Guatemala, where a state of disaster was declared two weeks ago because of a drought which has caused chronic malnutrition among the population.

El Salvador

In El Salvador, the picture is not quite so bleak.

The president of the Chamber of Commerce, Jorge Daboub, says that "so far, trade has been relatively normal".

Twelve-thousand workers have been waiting for 16 containers of raw materials from Honduras Jorge Daboub El Salvador Chamber of Commerce

But he warns that "there's always a risk, especially with riots in the capital Tegucigalpa" - a reference to the unrest that broke out there following protests calling for the reinstatement of Mr Zelaya when he returned last week.

However, Mr Daboub did admit that several assembly plants have been affected.

"Twelve-thousand workers have been waiting for 16 containers of raw materials from Honduras, but with the border closed, they run the risk of losing work," he says.

Trade between the two countries exceeds $18m a week. But trade with the US has also been affected because most exports to and imports from the US go through Puerto de Cortes, on the Atlantic coast of Honduras.

The current political impasse increases the risk of goods lorries becoming stranded in Honduras, especially at night, when the curfew comes into force in the capital.

One businessman had to kill thousands of poultry he was sending to Tegucigalpa because the Honduran military would not let the lorry through.

"They were in the boiling hot sun and gradually started dying, so he decided it was better to drown them in the river," Mr Daboub explains.

Continuing tensions

In Honduras itself, the political stalemate continues.

The Brazilian embassy remains surrounded by police and troops

Manuel Zelaya remains holed up in the Brazilian embassy, where he has taken refuge for more than a week.

The former president had been in exile for nearly three months after being driven from the country at gun-point in June.

Mr Zelaya says he slipped back into Honduras on foot to restore democracy.

But neither he nor the interim government has come any closer to resolving the crisis, and the Brazilian embassy is still surrounded by police and troops.

The interim authorities are refusing to reinstate Mr Zelaya, despite growing calls for them to do so.

Unless some settlement is reached, then the political crisis will continue to affect trade across Central America.