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Honduras: Background and U.S. Relations

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Honduran-U.S. Relations Peter J. Meyer Analyst in Latin American Affairs July 14, 2011April 25, 2012 Congressional Research Service 7-5700 www.crs.gov RL34027 CRS Report for Congress Prepared for Members and Committees of Congress Honduran-U.S. Relations Summary On January 27, 2010, Porfirio “Pepe” Lobo SosaPorfirio Lobo was inaugurated president of Honduras, in January 2010, assuming power after seven months of domestic political crisis and international isolation that had resulted from the June 28, 2009, June 2009 ouster of President Manuel Zelaya. While the strength of Lobo’s National Party in the legislature has enabled thehis administration to pass much of its policy agenda, Lobo has made only limited progress in addressing the challenges inherited as a result of the political crisis. Several efforts to foster political reconciliationhad limited success in resolving the many challenges facing Honduras. Efforts to foster political reconciliation, for example, have helped Honduras secure international recognition but have done little to lessen domestic polarization. Likewise, human rights abuses—which increased significantly in the aftermath of Zelaya’s ouster—have continued, and the citizen security situation has deteriorated. In June 2011, 45% of Hondurans approved of Lobo’s performance in office. In addition to the political problems inherited as a result of the 2009 ouster, Lobo has had to contend with a weak economy. Honduras suffered an economic contraction of 2.1% in 2009 as the global financial crisis, together with the domestic political crisis, led to significant declines in tourism, remittances, export earnings, and foreign investment. Lobo has pushed a number of reforms through Congress designed to restore macroeconomic stability, strengthen public finances, and encourage sustained economic growth. Although these reforms have generated considerable opposition from some sectors of Honduran society, they have the support of the international financial institutions, which are now providing Honduras with access to much needed development financing. The economy began to recover in 2010, with estimated growth of 2.8%, and is expected to grow by 3.8% in 2011. Nonetheless, significant development challenges remain. Approximately 60% of Honduras’ 8 million citizens live below the poverty line and the country performs poorly on a number of social indicatorsonly partially diminished domestic polarization. Lobo is relatively unpopular halfway through his fouryear term, as 68% of Hondurans believe he has done little to resolve the public’s demands. The poor security and human rights situation in Honduras has continued to deteriorate under President Lobo. Honduras has one of the highest homicide rates in the world, and common crime remains widespread. Moreover, human rights abuses—which increased significantly in the aftermath of Zelaya’s ouster—have persisted. A number of inter-related factors have likely contributed to this situation, including the increasing presence of organized crime, weak government institutions, and widespread corruption. Although the government has adopted a number of policy reforms designed to address these challenges, conditions have yet to improve. Lobo also inherited a weak economy with high levels of poverty and inequality. Honduras suffered an economic contraction of 2.1% in 2009 as a result of the combined impact of the global financial crisis and domestic political crisis. Since taking office, Lobo has secured much needed support from the international financial institutions, and has pushed a number of structural reforms through Congress designed to restore macroeconomic stability and strengthen public finances. Despite the government’s tight fiscal policies, the economy grew by 3.8% in 2011 and is expected to grow 4% in 2012. In an attempt to improve social conditions, Lobo has begun implementing a new conditional cash transfer program. Considerable development challenges remain, however, as over two-thirds of Honduras’ 8.1 million citizens live in poverty. Although relations were strained during the political crisis, the United States has traditionally had a close relationship with Honduras. Broad U.S. policy goals in the country include a strengthened democracy with an effective justice system that protects human rights and promotes the rule of law, and the promotion of sustainable economic growth with a more open economy and improved living conditions. In addition to providing Honduras with substantial amounts of foreign assistance ($50.2 million in FY2010) and maintaining significant military and economic ties, the United States cooperates with Honduras on transnational issues such as migration, crime, narcotics trafficking, trafficking in persons, and port security. The 111th Congress expressed considerable interest in Honduras as a result of the 2009 political crisis and its aftermath. Several resolutions were introduced and multiple hearings were held. Issues such as human rights abuses, the state of democracy, security challenges, and the treatment of U.S. businesses have continued to be of interest to the 112th Congress. On June 15, 2011, a bill (H.R. 2200) was introduced in the House to limit U.S. assistance to Honduras unless the President certifies that the Government of Honduras has settled all outstanding expropriation claims brought by U.S. companies. This report examines current political and economic conditions in Honduras as well as issues in Honduran-U.S. relations. For a more detailed examination of the Honduran political crisis, see CRS Report R41064, Honduran Political Crisis, June 2009-January 2010. Congressional Research Service Honduran-U.S. Relations Contents Recent DevelopmentsTo advance these policy objectives, the United States provides Honduras with foreign assistance, maintains significant security and commercial ties, and engages on transnational issues such as migration and human trafficking. The 112th Congress has expressed considerable interest in Honduras, particularly with regards to the state of democracy, human rights abuses, security challenges, and the treatment of U.S. businesses. In December 2011, Congress adopted the Consolidated Appropriations Act of 2012 (P.L. 112-74), which contains a provision requiring the State Department to withhold 20% of assistance appropriated for the Honduran military and police forces until certain human rights conditions are met. Additional legislation (H.R. 2200), introduced in June 2011, would limit U.S. assistance to Honduras unless the President certifies that the Government of Honduras has settled all outstanding expropriation claims brought by U.S. companies. This report examines current conditions in Honduras as well as issues in U.S-Honduran relations. Congressional Research Service Honduran-U.S. Relations Contents Political Situation...........................................................................................................................1 Political Situation.. 1 Background........................................................................................................................2 Background ................ 1 Political Crisis ..................................................................................................................2 Political Crisis.... 3 2009 Election ......................................................................................................................3 Detention and Expulsion of Zelaya 4 Lobo Administration (2010-Present) ..................................................................................3 Micheletti Government .............. 6 Political Reconciliation ............................................................................................4 November 2009 Elections ...................... 6 International Recognition....................................................................................5 Lobo Administration ................ 9 2013 Election.............................................................................................7 Political Reconciliation ................................ 9 Security and Human Rights Conditions...................................................................7 Truth Commission........................... 10 Criminal Threats, Weak Institutions, and Corruption.............................................................. 12 Public Security Policies........................7 Constitutional Reform...............................................................................................9 Return of Zelaya .. 14 Economic and Social Conditions................................................................................................... 10 Human Rights 16 Crises and Recovery ................................................................................................................ 11 Press Freedom and the Killing of Journalists ............16 Social Indicators ............................................... 11 International Recognition .............................................................................................. 12 Economic and Social Conditions 17 Issues in U.S.-Honduran Relations ................................................................................................ 13 Background .....18 Foreign Assistance................................................................................................................... 13 Crises and Recovery.19 Bilateral Assistance ........................................................................................................... 14 Issues in U.S.-Honduran Relations ..............19 Additional U.S. Assistance.............................................................................. 16 Foreign Assistance ..................... 20 Human Rights Conditions on Aid ......................................................................................... 17 Military Cooperation........ 22 Security Cooperation ................................................................................................... 18 Trade and Investment ........................ 22 Counternarcotics Cooperation.............................................................................................. 19 Migration Issues............................................................................. 23 Military Ties ..................................... 20 Temporary Protected Status........................................................................................... 20 Remittances 23 Port Security....................................................................................................................... 21 Deportations ... 24 Trade and Investment .............................................................................................................. 21 Crime, Violence, and Drug Trafficking.......24 Migration Issues ......................................................................... 22 Honduran Security Efforts............................................................................................. 23 U.S. Cooperation.. 26 Temporary Protected Status............................................................................................... 26 Deportations .................... 24 Human Trafficking.............................................................................................................. 24 Port Security ......... 27 Trafficking in Persons.............................................................................................................. 2527 Figures Figure 1. Map of Honduras .............................................................................................................. 2 Figure 2. Party Affiliation in the Unicameral Honduran National Congress..................................6 Tables Table 1. U.S. Bilateral Assistance to Honduras, FY2008-FY2012 ............... 5 Figure 3. Honduran Homicide Rate, 2000-2010................................ 17 Congressional Research Service Honduran-U.S. Relations Contacts Author Contact Information .................................................... 11 Tables Table 1. Bilateral U.S. Assistance to Honduras, FY2008-FY2013.................................................. 26 Acknowledgments ......... 20 Congressional Research Service Honduran-U.S. Relations Contacts Author Contact Information........................................................................................................... 2628 Congressional Research Service Honduran-U.S. Relations Recent Developments On July 7, 2011, the Truth and Reconciliation Commission appointed by President Lobo to investigate the June 28, 2009, ouster of President Manuel Zelaya issued its report. (For more information, see “Truth Commission.”) On June 26, 2011, an assembly of the leftist National Popular Resistance Front (FNRP) approved the creation of a political party—the Broad Front of Popular Resistance (FARP)—to contest the November 2013 Honduran elections. On June 14, 2011, the House Foreign Affairs Subcommittee on the Western Hemisphere held a hearing on U.S. policy toward Honduras titled, “Holding Honduras Hostage: Revoked Visas and U.S. Policy.” On June 1, 2011, the member-states of the Organization of American States (OAS) voted 32-1 to lift Honduras’ suspension from the organization. (For more information, see “International Recognition.”) On May 31, 2011, 87 U.S. Members of Congress signed a letter to Secretary of State Clinton that expressed concern about the protection of human rights, freedom of expression, and the rule of law in Honduras, and called for the suspension of U.S. police and military assistance to the country “due to the lack of mechanisms in place to ensure security forces are held accountable for abuses.” On May 28, 2011, nearly two years after he was first forced into exile, former President Zelaya returned to Honduras. (For more information, see “Return of Zelaya.”) On May 22, 2011, President Lobo and former President Zelaya signed the “Accord for National Reconciliation and the Consolidation of the Democratic System in Honduras.” Among other provisions, the accord (1) guarantees the right of Zelaya and his exiled supporters to return to political life in Honduras; (2) reaffirms that the Honduran government has an obligation to protect human rights; (3) ensures that the FNRP can register as a political party; and (4) reiterates that the recent reforms to the Honduran constitution guarantee citizens’ rights to seek national plebiscites on issues of fundamental importance. On May 2, 2011, the Honduran Court of Appeals voted 2-1 to annul criminal charges against former President Zelaya. On March 9, 2011, Honduran police discovered a Mexican-run cocaine lab, the first ever found in the country. (For more information, see “Crime, Violence, and Drug Trafficking.”) On February 17, 2011, the Honduran National Congress approved a measure that makes it easier for citizens to call plebiscites and referendums, and allows such citizen initiatives to address “issues of fundamental importance to national life,” potentially including constitutional changes. (For more information, see “Constitutional Reform.”) Congressional Research Service 1 Honduran-U.S. Relations Figure 1. Map of Honduras Source: CRS. Political Situation Background A Central American nation of 8 million people, Honduras enjoyed 27 years of uninterrupted democratic, constitutional governance prior to the forced removal of President Manuel Zelaya from office in June 2009. The Liberal (PL) and National (PN) Parties have been Honduras’ two dominant political parties since the military relinquished political control in 1982. Both have traditionally been based around patron-client networks and there appear to be few ideological differences between them. Both parties have generally been considered to be ideologically centerright; however, the PL is heterogeneous and includes some center-left factions. 1 1 Honduras: A Country Study, ed. Tim L. Merrill, 3rd ed. (Washington, DC: Library of Congress, Federal Research Division, 1995). Congressional Research Service 2 Honduran-U.S. Relations Political Situation Background Honduras, a Central American nation of 8.1 million people, has suffered from political instability and authoritarian governance for much of its history. The military has traditionally played a large role in domestic politics, and essentially controlled the national government from 1963 until 1971, and again from 1972 until 1982. Hondurans elected a national constituent assembly to draft a new constitution in 1980, and the country returned to civilian rule in 1982 following presidential and legislative elections. Nevertheless, the military continued to operate as an autonomous institution. While Honduras did not experience a civil conflict like those in El Salvador, Guatemala, and Nicaragua, the Honduran military pursued hard-line anticommunist security policies and was responsible for human rights abuses in the 1980s. According to the National Commissioner for Human Rights, the Honduran security forces systematically engaged in arbitrary detentions, torture, and extrajudicial executions, disappearing at least 179 people between 1980 and 1992.1 During the 1990s, successive Honduran administrations took steps to reduce the power of the military. Mandatory military service was abolished, the police and several state-owned enterprises were removed from military control, and—after the ratification of constitutional reforms in 1999—the military was subordinated to a civilian-appointed defense minister. The Liberal (Partido Liberal, PL) and National (Partido Nacional, PN) Parties have dominated Honduran politics since the military relinquished political control in 1982. Both political parties are considered to be ideologically center-right; however, the PL includes a small center-left wing. The parties are oriented around personalist factions and are largely viewed as vehicles for patronage.2 According to a number of analysts, “the objective of political competition between the two parties has not been a competition for policies or programs, but rather a competition for personal gain in which the public sector is turned into private benefit.”3 The PL has traditionally had the broadest political base in the country, winning five of the eight presidential elections held since 1982. Three smaller parties—the Christian Democratic Party (Partido Demócrata Cristiano, DC), the Innovation and Unity Party (Partido Inovación y Unidad, PINU), and the Democratic Unification party (Unificación Democrática, UD)—also participate in elections and hold a few seats in the National Congress. 1 Comisionado Nacional de los Derechos Humanos (CONADEH), Los Hechos Hablan por Sí Mismos: Informe Preliminar sobre los Desaparecidos en Honduras, 1980-1993, Second Edition, Tegucigalpa, Honduras, May 2002. An English language translation is available at http://www.cja.org/downloads/Honduras_Report_%22The_Facts_Speak_for_Themselves%22.pdf. 2 J. Mark Ruhl, "Honduras Unravels," Journal of Democracy, vol. 21, no. 2 (April 2010). 3 Honduras: A Country Study, ed. Tim L. Merrill, 3rd ed. (Washington, DC: Library of Congress, Federal Research Division, 1995), p.174. Several more recent studies of the Honduran party system offer similar analysis. See, for example, Ramón Romero, "Los Partidos Políticos y el Estado Hondureño: Evidencias de la Miopía Partidaria," in Golpe de Estado: Partidos, Instituciones, y Cultura Política (Tegucigalpa: Centro de Documentación de Honduras, 2010), pp. 23-54; and Leticia Salomón, "Honduras: Golpe de Estado, Sistema de Partidos y Recomposición Democrática," in Honduras: Retos y Desafíos de la Reconstrucción Democrática (Tegucigalpa: Centro de Documentación de Honduras, 2011), pp. 1-22. Congressional Research Service 1 Honduran-U.S. Relations Figure 1. Map of Honduras Source: CRS. Manuel Zelaya of the PL was elected president in November 2005, narrowly defeating the PN’s Porfirio Lobo. As a wealthy landowner who founded a center-left faction within the PL, Zelaya was regarded as a moderate when he was inaugurated to a four-year term in January 2006.24 As his term progressed, however, Zelaya advanced a number of populist policies, including a 60% increase in the minimum wage in December 2008.35 Zelaya also forged closer relations with Venezuelan President Hugo Chávez, joining initiatives such as PetroCaribe, which provides oil at preferential discounted rates, and the Bolivarian Alternative for the Americas (Alternativa Bolivariana para las Américas, ALBA), a socially -oriented trade block. 46 Although Zelaya’s populist policies helped him maintain support among certain sectors of Honduran society, they alienated many within the traditional economic and political elite. Likewise, his administration’s inability to achieve concrete results on a number of issues of importance—such as poverty and violent crime—significantly weakened his public standing.5 Political Crisis6 Detention and Expulsion of Zelaya 4 “Manuel Zelaya to Head Honduras and Redefine His Party,” Latin America Data Base, NotiCen, December 15, 2005; “Country Profile: Honduras,” Economist Intelligence Unit, November 14, 2006. 5 “Elevan a L.5500 el Salario Mínimo en Honduras,” El Heraldo (Honduras), December 24, 2008. 6 It should be noted that the National Congress ratified Honduras’ entrance into both PetroCaribe and ALBA. Congressional Research Service 2 Honduran-U.S. Relations Political Crisis7 On June 28, 2009, the Honduran military detained President Zelaya and flew him to forced exile in Costa Rica. The ouster followed several months of political polarization between Honduran governmental institutions resulting from Zelaya’s intention to hold a non-binding referendum and eventually amend the constitution. While Zelaya insisted that the non-binding referendum was nothing more than an opinion poll to consult the Honduran populace on the possibility of voting to convene a constituent assembly,78 others in Honduras viewed it asmaintained that it was an unconstitutional attempt to perpetuate himself in power.8 In the aftermath of Zelaya’s expulsion, the Honduran Supreme Court9 produced documents asserting that an arrest warrant for President Zelaya had been issued in secrecy on June 26, 2009, as a result of his noncompliance with judicial rulings suspending all activities related to the non-binding referendum. 10 Likewise, the Honduran National Congress ratified the ouster by accepting an alleged letter of resignation, which Zelaya declared 2 “People Profile: Manuel ‘Mel’ Zelaya,” Latin News Daily, November 15, 2005; “Manuel Zelaya to Head Honduras and Redefine His Party,” Latin America Data Base, NotiCen, December 15, 2005; “Country Profile: Honduras,” Economist Intelligence Unit, November 14, 2006. 3 “Elevan a L.5,500 el Salario Mínimo en Honduras,” El Heraldo (Honduras), December 24, 2008. 4 It should be noted that the National Congress ratified Honduras’ entrance into both PetroCaribe and ALBA. “Honduras: Congress Signs Up to PetroCaribe” Latin American Caribbean & Central America Report, March 2008; “Honduras: Congress Approves Alba, With Caveats,” Latin American Caribbean & Central America Report, October 2008. 5 Mica Rosenberg, “Protests Erupt, Gunshots Heard After Honduras Coup,” Reuters, June 28, 2009. 6 For a more detailed examination of the Honduran political crisis, see CRS Report R41064, Honduran Political Crisis, June 2009-January 2010. 7 The non-binding referendum would have asked Hondurans, “Do you agree that in the general elections of 2009, a fourth ballot box should be installed in which the people decide on the convocation of a National Constituent Assembly?” “Llegó el Día de Verdad,” El Tiempo (Honduras), June 28, 2009. 8 “Honduras: Fiscalía Dice Zelaya No Puede Llamar a Consulta Popular,” Associated Press, March 25, 2009. 9 The U.S. State Department’s 2010 Country Reports on Human Rights Practices states that “although the constitution and the law provide for an independent judiciary,” the Honduran judicial system is “subject to patronage, corruption, and political influence.” 10 Poder Judicial de Honduras, Expediente Judicial Relación Documentada Caso Zelaya Rosales, http://www.poderjudicial.gob.hn/. Congressional Research Service 3 Honduran-U.S. Relations fraudulent,11 and ouster by accepting an alleged letter of resignation, which Zelaya declared fraudulent, and passing a decree that disapproved of Zelaya’s conduct, removed him from office, and named the head of Congress, Roberto Micheletti, as the president of Honduras for the remainder of Zelaya’s term. 1211 The legality of Zelaya’s removal has been heavily debated; however, most legal and political analysts—including the Truth and Reconciliation Commission appointed to investigate the ouster—have declared Zelaya’s removal a “coup d’état.”1312 They assert that although Zelaya disobeyed judicial rulings by attempting to carry out the non-binding referendum, the Honduran military denied the president due process by expelling him from the country. Additionally, they maintain that the Honduran National Congress did not have any legal authority to remove Zelaya from office, and the interim government of Roberto Micheletti was therefore unconstitutional. Micheletti Government Contrary to the findings of the Truth and Reconciliation Commission, Roberto Micheletti has Nevertheless, Micheletti and his supporters have insisted that he took office through a “constitutional succession.”14 While in power, Micheletti and13 After assuming office in late June 2009, Micheletti remained in power for nearly seven months. He worked with the Honduran National Congress passed a 2009to pass a budget that severely reduced government government expenditures, and enacted measures that annulled more than a dozen decrees and reforms approved under Zelaya, including Honduras’ accession to ALBA. 15 Micheletti also maintained tight control of Honduran society, severely restricting the political opposition. On the day of Zelaya’s ouster, security forces patrolled the streets, a curfew was put in place, and a number of local and international television and radio stations were shut down or intimidated.16 Over the next several months, the Micheletti government periodically implemented curfews—often with little or no prior notification—and issued decrees restricting civil liberties. 17 The Inter-American Commission on Human Rights (IACHR), an autonomous body of the Organization of American States (OAS), asserts that during the Micheletti government, serious violations of human rights occurred, including “deaths, an arbitrary declaration of a state of emergency, suppression of public demonstrations through disproportionate use of force, criminalization of public protest, arbitrary detentions of thousands of persons, cruel, inhuman and degrading treatment and grossly inadequate conditions of detention, militarization of Honduran territory, a surge in incidents of racial discrimination, violations of women’s rights, serious and 11 “Zelaya Ofrece Conferencia en Costa Rica,” La Prensa (Honduras), June 28, 2009. “El Decreto de la Separación de Zelaya,” El Heraldo (Honduras), June 28, 2009. 13 reforms approved under Zelaya.14 Micheletti also maintained tight control of Honduran society. The Inter-American Commission on Human Rights (IACHR), an autonomous body of the 7 For a more detailed examination of the Honduran political crisis, see CRS Report R41064, Honduran Political Crisis, June 2009-January 2010. 8 The non-binding referendum would have asked Hondurans, “Do you agree that in the general elections of 2009, a fourth ballot box should be installed in which the people decide on the convocation of a National Constituent Assembly?” “Llegó el Día de Verdad,” El Tiempo (Honduras), June 28, 2009. 9 It should be noted that although the Honduran judicial system is nominally independent, in practice, it is “subject to patronage, corruption, and political influence” according to the U.S. State Department’s 2010 Country Reports on Human Rights Practices. 10 Poder Judicial de Honduras, Expediente Judicial Relación Documentada Caso Zelaya Rosales, July 2009. 11 “El Decreto de la Separación de Zelaya,” El Heraldo (Honduras), June 28, 2009. 12 See, for example, Edmundo Orellana, “El 28 de Junio y la Constitución,” La Tribuna (Honduras), August 1, 2009; Tim Johnson, “All Parties Broke Law in Honduras Coup, Envoy Wrote,” McClatchy Newspapers, November 28, 2010; and Comisión de la Verdad y la Reconciliación (CVR), Para que los Hechos No se Repitan: Informe de la Comisión de la la Verdad y la Reconciliación, San José, Costa Rica, July 2011, http://www.cvr.hn/home/noticias/hojas-de-prensa/paraque-los-hechos-no-se-repitan-informe-de-la-comision-de-la-verdad-y-la-reconciliacion-cvr/. 1413 Roberto Micheletti, “Moving Forward in Honduras,” Washington Post, September 22, 2009; Testimony of Roberto Micheletti, before the House Foreign Affairs Subcommittee on the Western Hemisphere, June 14, 2011. 15. 14 “Honduras: Micheletti Prepares to Leave on High Note,” Latin News Weekly Report, January 21, 2010. 12 16 “Honduras: Decretan Toque de Queda por 48 Horas,” La Prensa (Honduras), June 28, 2009; “Honduras: Media Blackout, Protests Reported,” STRATFOR, June 29, 2009. 17 “Honduras Suspende Derechos Constitucionales Durante Toque Queda,” Reuters, July 1, 2009; Amnesty International, “Honduras: Human Rights Crisis Threatens as Repression Increases,” August 2009. Congressional Research Service 4 Honduran-U.S. Relations arbitrary restrictions on the right to freedom of expression, and grave violations of political rights.”18 Although some sectors of Honduran society strongly supported Micheletti, a December 2010 poll found that 64% of Hondurans considered Zelaya’s expulsion a coup d’état, and nearly 59% thought Micheletti should be put on trial.19 November 2009 Elections On November 29, 2009, Honduras held general elections Congressional Research Service 3 Honduran-U.S. Relations Organization of American States (OAS), asserts that serious violations of human rights occurred during the Micheletti government, including “deaths; an arbitrary declaration of a state of emergency; suppression of public demonstrations through disproportionate use of force; criminalization of public protest; arbitrary detentions of thousands of persons; cruel, inhuman and degrading treatment and grossly inadequate conditions of detention; militarization of Honduran territory; a surge in incidents of racial discrimination; violations of women’s rights; serious and arbitrary restrictions on the right to freedom of expression; and grave violations of political rights.”15 Although some sectors of Honduran society strongly supported Micheletti and the ouster of Zelaya, polling suggests that the majority of Hondurans did not.16 2009 Election On November 29, 2009, Honduras held a general election to fill nearly 3,000 posts nationwide, including the presidency and all 128 seats in the unicameral National Congress.20 Former President President of Congress and 2005 National Party (PN)PN presidential nominee Porfirio Lobo easily defeated his closest rival, former Vice President Elvin Santos of the Liberal Party (PL)PL, 56.6% to 38.1%. Three minor party candidates won a combined 5.3% of the presidential vote. 2117 Lobo’s PN also won an absolute majority in the unicameral National Congress, with 71 of the 128 seats. The election was a major defeat for the PL, which has traditionally had the broadest base of support in Honduras. On top of its poor presidential showing, it won just 45 seats in Congress, down from 62 in 2005 (see Figure 2 below for the change in the legislative balance of power).22 According to some analysts, many).18 Some analysts assert that Hondurans held the PL responsible for the country’s political crisis as a result of Zelaya and Micheletti both belonging to the party. Likewise, traditional PL supporters were divided over the ousterpolitical crisis, leading many some from the Zelaya-allied faction to stay home on election day.23 There has been considerable debate—both in Honduras and the international community— concerning the legitimacy of the November 2009 elections as a result of them being held under the Micheletti government. Supporters of the elections note that the electoral process was initiated, and the members of the autonomous Supreme Electoral Tribunal (TSE) were chosen, prior to Zelaya’s ouster. They also note that the candidates were selected in internationally observed primary elections in November 2008,24 and that election day was largely25 free of 18 Inter-American Commission on Human Rights, Honduras: Human Rights and the Coup D'état, Organization of American States, OEA/Ser.L/V/II. Doc. 55, December 30, 2009. 19 Universidad on election day.19 15 Inter-American Commission on Human Rights (IACHR), Honduras: Human Rights and the Coup D'état, December 30, 2009, http://cidh.org/countryrep/Honduras09eng/Toc.htm. 16 See, for example, Orlando J. Pérez, José René Argueta, and Mitchell A. Seligson, Cultura Política de la Democracia en Honduras, 2010, Vanderbilt University, Latin American Public Opinion Project, October 2010, http://www.vanderbilt.edu/lapop/honduras/2010-Cultura_politica_Honduras_smaller3.pdf; and Universidad Centroamericana José Simeón Cañas, Instituto Universitario de Opinion Publica (IUDOP), Los Hondureños y Hondureñas Opinan Sobre la Situación Política y Evalúan el Primer Año de Gestión de Porfirio Lobo, Boletín de Prensa, Año XXV, No.1, San Salvador, January 19, 2011. 20 “Elecciones, Incierto Antídoto Contra la Crisis Socio Política,” El Tiempo (Honduras), August 31, 2009. 21, http://www.uca.edu.sv/publica/iudop/Web/2010/boletinHonduras.pdf. 17 “TSE Confirma el Triunfo de ‘Pepe’ en las Elecciones,” El Heraldo (Honduras), December 21, 2009. 2218 “Final Results in Honduras,” Latin News Daily, December 22, 2009. 2319 Noé Leiva, “El Partido Liberal de Zelaya, el Gran Perdedor de los Comicios Hondureños,” Agence France Presse, November 30, 2009; “Partido Liberal Sacrificó el Poder para Salvar Democracia,” La Tribuna (Honduras), December 3, 2009. 24 Former Vice President Elvin Santos, although originally ruled constitutionally ineligible to run by the TSE, became the PL presidential nominee following a series of events that included congressional passage of a special decree and a 52%-32% primary victory by his stand-in-candidate, Mauricio Villeda, over then President of Congress, Roberto Micheletti. “Honduras’ Vice President Regains the Right to Run; Elvin Santos is Partido Liberal Presidential Candidate,” Latin America Data Base, NotiCen, March 5, 2009. 25 A demonstration in San Pedro Sula by those opposed to the government of Roberto Micheletti was forcefully dispersed on election day. “Police Fire Tear Gas on Honduras Poll Protesters,” Agence France Presse, November 29, 2009. Congressional Research Service 5 Honduran-U.S. Relations political violence.26 Nonetheless, some Hondurans and international observers have argued that the Congressional Research Service 4 Honduran-U.S. Relations Figure 2. Party Affiliation in the Unicameral Honduran National Congress (2005 and 2009 Election Results) Source: CRS. There has been considerable debate—both in Honduras and the international community— concerning the legitimacy of the November 2009 election as a result of it being held under the Micheletti government. Supporters of the election note that the electoral process was initiated, and the members of the autonomous Supreme Electoral Tribunal (TSE) were chosen, prior to Zelaya’s ouster. They also note that the candidates were selected in internationally observed primary elections in November 2008,20 and that election day was largely21 free of political violence.22 Nonetheless, some Hondurans and international observers have argued that the Micheletti government’s suppression of opposition media and demonstrators prevented a fair electoral campaign from taking place. This led to election boycotts and a number of left-leaning candidates for a variety of offices withdrawing from the elections.27election.23 It also led organizations that traditionally observe elections in the hemisphere, such as the OAS, the European Union, (EU), and the Carter Center, to cancel their electoral observation missions.28 Critics of the elections also election also assert that the electoral turnout, which was just under 50% (five points lower than 2005), demonstrated a rejection of the electionselection by the Honduran people. Supporters of the elections election counter this assertion by arguing that Lobo won more absolute votes in 2009 than Zelaya did in 2005, and that the electoral rolls are artificially inflated—distorting the turnout rate—as a result of Honduras not purging the rolls of those who have died or migrated abroad.29 Figure 2. Party Affiliation in the Unicameral Honduran National Congress (2005 and 2009 Election Results) Source: CRS. 26 2005, and that the 20 Former Vice President Elvin Santos was originally ruled constitutionally ineligible to run by the TSE, but became the PL presidential nominee after his stand-in-candidate, Mauricio Villeda, won the PL primary and Congress passed a special decree to allow his candidacy. 21 A demonstration in San Pedro Sula by those opposed to the government of Roberto Micheletti was forcefully dispersed on election day. 22 José Saúl Escobar Andrade, Enrique Ortez Sequeira, and David Andrés Matamoros Batso, “Honduran Elections,” Remarks at the Inter-American Dialogue, Washington, DC, October 22, 2009; International Republican Institute, “Hondurans Turn Out to Polls in Credible Elections: IRI’s Preliminary Statement on Honduras’ 2009 National Elections,” November 30, 2009. 2723 “Seguidores de Zelaya No Particparán en Elecciones Aunque Haya Restitución,” EFE News Service, November 8, 2009; “Renuncian Importantes Dirigentes del Liberalismo,” El Tiempo (Honduras), November 22, 2009. 28 Gustavo Palencia, “Honduras Busca Convencer Observadores para Cuestionada Elección,” Reuters, November 12, 2009; “La CE Dice que No Hay Tiempo para una Misión Electoral y Envía Dos Expertos,” EFE News Service, November 11, 2009. 29 “Honduras: Tug of War Between Opposition and De Facto Regime Regarding Flow of Voters,” Latin America Data Base, NotiCen, December 3, 2009; “Final Results in Honduras,” Latin News Daily, December 22, 2009. Congressional Research Service 6 Honduran-U.S. Relations Lobo Administration A year and a half after his inauguration to a four-year term, President Lobo continues to face daunting challenges stemming from Honduras’ seven-month political crisis. Efforts to foster political reconciliation, including the creation of a truth commission, the passage of a political reform measure, and an agreement to allow former President Zelaya to return to the country have produced mixed results. Although these reconciliation efforts have won support from the international community, they have done little to reduce domestic polarization. Moreover, there has been little improvement in the country’s poor human rights situation. Murders of journalists, political activists, and human rights defenders have continued and law enforcement officials have proven unwilling or unable to bring those responsible to justice. Lobo’s popularity has also suffered as a result of the public’s perception that the government has made little progress in addressing issues of importance such as unemployment and the deteriorating security situation. While the strength of Lobo’s National Party in the legislature has enabled the government to secure passage of several policies designed to address these issues, Hondurans have seen few improvements thus far (see “Economic and Social Conditions” and “Crime, Violence, and Drug Trafficking” below). In June 2011, Hondurans were split in their opinions of President Lobo with 45% approving and 44% disapproving of his performance in office.30 Political Reconciliation President Lobo has taken a number of steps to ease political polarization in Honduras, but still faces significant challenges. Upon taking office in late January 2010, Lobo arranged safe passage out of the country for former President Zelaya31 and immediately signed a bill providing political amnesty to Zelaya and those who removed him from office. The amnesty covers political and common crimes committed prior to and after the removal of Zelaya, but does not include acts of corruption or violations of human rights.32 President Lobo also appointed a national unity cabinet with representatives of each of the five official political parties, and pledged to engage in dialogue with all sectors of Honduran society. Since then, Lobo has established a truth commission to investigate the events surrounding the 2009 ouster, passed a constitutional reform to grant greater power to citizen initiatives, and forged an agreement with former President Zelaya to facilitate his return to Honduras. Truth Commission In April 2010, President Lobo established a Truth and Reconciliation Commission (Comisión de la Verdad y la Reconciliación, CVR) to investigate the events surrounding the ouster of President Zelaya and to make recommendations to prevent similar events from occurring in the future.33 The creation of a truth commission had previously been agreed to by Zelaya and Micheletti as 30 “8 de 10 Creen que País Va por Rumbo Equivocado,” La Prensa (Honduras), June 28, 2011. Zelaya had clandestinely returned to Honduras in September 2009, but was unable to leave the Brazilian Embassy where he had taken refuge. 32 “Lobo Secures Exit from Honduras for Zelaya,” Latin News Daily, January 21, 2010; “Congreso Aprueba Amnistía para Delitos Políticos Comunes Conexos,” El Tiempo (Honduras), January 27, 2010. 33 Honduras, Presidencia de la República, Decreto Ejecutivo Número PCM-011-2010. 31 Congressional Research Service 7 Honduran-U.S. Relations part of the Tegucigalpa-San José Accord, which they signed in late October 2009 in a failed attempt to end the political crisis. Although the accord fell apart almost immediately, Lobo has implemented several of its provisions since taking office as part of his efforts to facilitate political reconciliation. The five-member CVR was led by former Guatemalan Vice President Eduardo Stein, and included two Hondurans and two additional international representatives. 34 It officially began its work in May 2010. Reflecting the political polarization in Honduras, the CVR was immediately criticized by both the right and the left. Critics on the right feared that the CVR could be used as a means to promote the constitutional reforms that former President Zelaya proposed in the lead up to the country’s political crisis. In June 2010, President Lobo even suggested that some extremist elements on the right were plotting to overthrow him as a result of his reconciliation efforts.35 Human rights groups criticized President Lobo for establishing the CVR on his own without consultation with civil society groups. Likewise, the leftist National Popular Resistance Front 36 (Frente Nacional de Resistencia Popular, FNRP)—an umbrella group of those who were opposed to Zelaya’s removal—viewed the CVR as an attempt to “whitewash” the ouster. As a result, Zelaya called on officials from his government not to cooperate with the CVR and the FNRP established an alternative truth commission. 37 On July 7, 2011, the CVR issued its final report. Among other findings, the report asserts (1) Zelaya refused to recognize or obey orders from the judicial branch and other governmental institutions to halt activities related to the proposed non-binding referendum; (2) the Honduran military partially acted on a judicial order in detaining Zelaya but the high command’s decision to force the president into exile violated due process and thus amounted to a coup d’état; (3) the Honduran National Congress had no power to remove President Zelaya or name a substitute and therefore the government of Roberto Micheletti was illegal; (4) there is no reliable evidence that President Zelaya intended to dissolve Congress, remain in office, or directly install a national constituent assembly after holding the non-binding referendum; (5) the November 2009 elections were legitimate; and (6) members of the Honduran military and police killed at least 12 citizens as a result of the disproportionate use of force to suppress political demonstrations during the Micheletti government. The CVR’s report also provides a wide variety of recommendations to avoid similar crises in the future. These include reforming the constitution to establish clear impeachment procedures and investigating, processing, and punishing those responsible for the human rights abuses that took place in the aftermath of the ouster.38 34 The other members of the CVR were Canadian diplomat Michael Kergin; former Peruvian judicial official María Amadilia Zavala Valladares; Julieta Castellas, the rector of the National Autonomous University of Honduras (UNAH); and Jorge Omar Casco, the former rector of UNAH. 35 Germán Reyes, “Lobo Pide No Temer a Comisión de Verdad y Avala Consulta para Constituyente,” Agencia EFE, May 4, 2010; “Presidente Hondureño Insinúa que se está Gestando Otro Golpe de Estado,” Agence France Presse, June 8, 2010. 36 The FNRP initially was formed after Zelaya’s ouster as the National Resistance Front Against the Coup d’état. Zelaya serves as the General Coordinator of the FNRP, which also includes an executive committee representative of the movement’s composite parts: labor unions, worker and campesino organizations, human rights advocates, the Zelaya-allied faction of the Liberal Party, and other civil society groups. 37 “Zelaya Calls on Former Officials Not to Collaborate with Truth Commission,” ACAN-EFE, June 8, 2010; “Honduran Resistance Sets Up Alternative Commission,” Latin News Weekly Report, July 1, 2010. 38 Comisión de la Verdad y la Reconciliación (CVR), Para que los Hechos No se Repitan: Informe de la Comisión de la Verdad y la Reconciliación, San José, Costa Rica, July 2011, http://www.cvr.hn/home/noticias/hojas-de-prensa/paraque-los-hechos-no-se-repitan-informe-de-la-comision-de-la-verdad-y-la-reconciliacion-cvr/. Congressional Research Service 8 Honduran-U.S. Relations Constitutional Reform As noted above, President Zelaya was advocating constitutional reform at the time of his ouster. Zelaya, the FNRP, and others maintain that the current constitution, which was written in 1982 by a constituent assembly elected under the military government, reinforces political and economic exclusion of the majority of the Honduran population. They believe the only way to overcome this exclusion is to convene a democratic and inclusive constituent assembly to draft a new constitution. 39 The FNRP claims to have gathered over 1.3 million signatures in support of such an assembly, which—if verified—would surpass the number of votes received by Lobo in November 2009.40 President Lobo, who never ruled out the idea of abstract constitutional changes as a candidate, called for a national dialogue to discuss potential political, economic, and social reforms in October 2010. After consulting with each of the political parties and various sectors of Honduran society, Lobo proposed a measure that would grant greater power to citizen initiatives. The proposal, which was approved by the Honduran National Congress in February 2011, amended the constitutional provisions governing referendums and plebiscites to allow such citizen initiatives to address “issues of fundamental importance to national life,” potentially including changes to the currently unalterable portions of the constitution. 41 Lobo held another dialogue in July 2011, in which he invited representatives from the five officially recognized political parties and seven parties in the process of formation to suggest constitutional reforms. After holding similar discussions with unions, business federations, and other civil society organizations, Lobo intends to suggest potential reforms to the National Congress. 42 Much like the truth commission, Lobo’s efforts around the issue of constitutional reform have largely failed to reduce polarization. The FNRP and others think the changes made thus far are insufficient. They note that any reforms suggested through citizen initiatives or Lobo’s national dialogue would need to be approved by the National Congress, an institution they believe represents entrenched interests that benefit from the status quo. Consequently, they have continued to push for a constituent assembly capable of drafting a new constitution.43 On the other hand, conservative elements within the traditional parties and civil society have reacted to Lobo’s efforts with suspicion. While conceding that abstract changes may be necessary, they are opposed to the idea of convoking a constituent assembly or any attempt to change the unalterable portions of the constitution. They also have accused Lobo of seeking reelection and catering to small radical groups instead of addressing real issues of national importance.44 39 “Rafael Alegría: Queremos Constituyente Democrática y Popular,” La Tribuna (Honduras), July 4, 2011. “Hondureños Reclaman en las Calles una Constituyente en el Día del Trabajdor,” Agence France Presse, May 1, 2010; Frente Nacional De Resistencia Popular, “Comunicado No.74: Avanzamos Seguros Hacia la Constituyente,” September 17, 2010. 41 “Honduras Congress Approves Referendums,” Latin News Daily, February 18, 2011. 40 42 Pedro Membreño, “Reformas Políticas Deben Proponerse este Año,” El Heraldo (Honduras), July 5, 2011; Francisco Rodriguez, “Dirigentes Políticos Coinciden en Reformas Constitucionales,” El Tiempo (Honduras), July 9, 2011. 43 “Honduras: Constitutional Change Tests Opposition Unity,” Oxford Analytica, February 14, 2011; “Rafael Alegría: Queremos Constituyente Democrática y Popular,” La Tribuna (Honduras), July 4, 2011; Frente Amplio de Resistencia Popular, “Posicionamiento Frente Amplio de Resistencia Popular,” July 9, 2011. 44 Unión Cívica Democrática, “Posición de la Unión Cívica Democrática Relacionada con la Reforma del Articulo 5 de la Constitución de la República,” November 11, 2010; “Anduray Postula Movimiento para Defender Constitución,” La Tribuna (Honduras), June 13, 2011; “‘Lobo y Hernández Gastan 2,000 Millones en Política’,” La Prensa (Honduras), July 11, 2011. Congressional Research Service 9 Honduran-U.S. Relations Return of Zelaya Following Lobo’s inauguration, domestic groups like the FNRP and a number of countries called on the president to create the conditions necessary to allow former President Zelaya to return to Honduras. Lobo encouraged Zelaya to return from exile but insisted that the former president would have to stand trial for the charges that were brought against him following his ouster, including fraud, falsification of public documents, and embezzlement of $2.95 million from the presidency and the Honduran Fund for Social Investment. Zelaya insisted that the charges were politically motivated and refused to return until they were dropped. On May 2, 2011, the Honduran court of appeals voted 2-1 to annul the criminal charges against Zelaya due to procedural irregularities.45 With criminal charges out of the way, former President Zelaya entered into a dialogue with President Lobo that was mediated by President Hugo Chávez of Venezuela and President Manuel Santos of Colombia. On May 22, 2011, Lobo and Zelaya signed the “Accord for National Reconciliation and the Consolidation of the Democratic System in Honduras.” Among other provisions, the Accord (1) guarantees the right of Zelaya and his exiled supporters to return to political life in Honduras; (2) reaffirms that the Honduran government has an obligation to protect human rights; (3) ensures that the FNRP can register as a political party; and (4) reiterates that the recent reforms to the Honduran constitution guarantee citizens’ rights to seek national plebiscites on issues of fundamental importance. 46 Former President Zelaya returned to Honduras on May 28, 2011, and immediately reentered politics. The FNRP, which had previously named Zelaya its general coordinator, voted to create a political party—the Broad Front of Popular Resistance (Frente Amplio de Resistencia Popular, FARP)—to contest the 2013 elections. Zelaya hopes to unite members of the FNRP, his supporters in the PL, and others who opposed his ouster under the FARP banner. 47 It remains unclear how much popular support the new political party will be able to attract. While the majority of the delegates at the FNRP assembly supported the creation of the FARP, some sectors are opposed to pursuing electoral politics.48 At the same time, many of the top PL officials that previously supported Zelaya and/or opposed his ouster have decided not to follow him into the FARP.49 On the other hand, over 80% of Hondurans have little or no faith in the existing political parties, 50 and Xiomara Castro de Zelaya, the former president’s wife and a potential candidate for the presidency in 2013, has the second-highest favorability ratings in the country among public figures. 51 45 “Zelaya Free to Roam,” Latin News Daily, May 3, 2011; “Honduras: Zelaya Ruling Removes Final Hurdle – Or Does It?” Latin American Weekly Report, May 5, 2011 46 “Acuerdo para la Reconciliación Nacional y la Consolidación del Sistema Democrático en la República de Honduras,” La Tribuna (Honduras), May 23, 2011. 47 Noé Leiva, “Zelayistas Forman ‘Frente Amplio’ para Elecciones de 2013,” Agence France Presse, June 26, 2011. 48 Todd Gordon and Jeffrey R. Webber, “The Different Logics within the Honduran Resistance: An Interview with Bertha Cáceres,” Upside Down World, June 27, 2011. 49 “Liberales en Resistencia se Quedan en el PL,” La Tribuna (Honduras), June 28, 2011; “Honduras: Liberales en Resistencia Prefieren PL,” El Heraldo (Honduras), June 29, 2011. 50 Universidad Centroamericana José Simeón Cañas, Instituto Universitario de Opinion Publica (IUDOP), Los Hondureños y Hondureñas Opinan Sobre la Situación Política y Evalúan el Primer Año de Gestión de Porfirio Lobo, Boletín de Prensa, Año XXV, No.1, San Salvador, January 19, 2011. 51 “Empatados a 35% Nacionalistas y Liberales,” La Prensa (Honduras), June 28, 2011. Congressional Research Service 10 Honduran-U.S. Relations Human Rights Another key challenge for the Lobo government is curtailing the increase in human rights violations that has occurred since the forced expulsion of President Zelaya. In March 2010, the U.S. State Department released its 2009 human rights report on Honduras. The report details numerous human rights violations that occurred in the aftermath of the ouster, including “unlawful killings by members of the police and government agents,” “arbitrary and summary killings committed by vigilantes and former members of the security forces,” and “arbitrary detention and disproportionate use of force by security forces.”52 Similar human rights abuses appear to have continued since President Lobo’s January 2010 inauguration. Following a May 2010 visit to Honduras, the Inter-American Commission on Human Rights (IACHR) expressed deep concern over murders of, and threats against, journalists, political activists, and human rights defenders, as well as the absence of effective investigations into these crimes. The IACHR also expressed concerns that the dismissal of judges opposed to Zelaya’s ouster was politicizing the justice system, and that Lobo’s appointment of several highranking military officers accused of participating in Zelaya’s removal to positions in the government was remilitarizing society.53 Although the Lobo Administration has taken some steps to improve the human rights situation—such as providing the Human Rights Unit in the Attorney General’s Office an independent budget for the first time and creating a new Ministry of Justice and Human Rights—Honduran and international human rights organizations assert that the Honduran government has made little progress, especially with regard to bringing human rights violators to justice. 54 According to a December 2010 Human Rights Watch report, at least 18 journalists, political activists, and human rights defenders were killed in Honduras in 2010.55 Press Freedom and the Killing of Journalists International human rights observers have been particularly concerned about declining press freedom in Honduras as media outlets and journalists have been the subjects of attacks. In the aftermath of Zelaya’s forced removal in June 2009, human rights organizations strongly criticized the Micheletti government for its attacks on press freedom, including government intimidation of journalists and media outlets and the temporary shutdown and interruptions of radio and television broadcasts. Press rights groups maintain that media workers were often targeted and foreign journalists were expelled. The IACHR issued a report in December 2009 asserting that there were serious violations of freedom of expression under Micheletti. The report maintained that the media became extremely polarized during the year, with those journalists and media supportive of the new Micheletti government subject to attacks by those who opposed Zelaya’s ouster, and those perceived as encouraging support for resistance to the government subject to severe restrictions by state actions and attacks by private citizens. Threats to press freedom have continued under the Lobo Administration. As noted above, the IACHR reported in May 2010 that it received information about threats and attacks directed 52 53 See the full text of the report at http://www.state.gov/g/drl/rls/hrrpt/2009/wha/136117.htm. IACHR “IACHR Publishes Observations on Follow-up Visit to Honduras,” Press Release No. 59/10, June 7, 2010. 54 Thelma Mejía, “Latin America: Honduras has Much to Explain in Human Rights Exam,” Inter Press Service, November 3, 2010. 55 Human Rights Watch, After the Coup: Ongoing Violence, Intimidation, and Impunity in Honduras, New York, December 2010. Congressional Research Service 11 Honduran-U.S. Relations against journalists to intimidate and impede their journalistic work. 56 In 2010, at least 10 journalists were murdered in Honduras, making the country among the most dangerous in the world for the media.57 According to a July 2010 report by the independent, nonprofit Committee to Protect Journalists, there is no evidence to “confirm a political conspiracy or coordinated effort behind the killings.” Nonetheless, the report asserts that “the murders occurred in a politically charged atmosphere of violence and lawlessness” and “the government’s ongoing failure to successfully investigate crimes against journalists and other social critics—whether by intention, impotence, or incompetence—has created a climate of pervasive impunity.”58 Press rights groups have repeatedly urged President Lobo to combat the crime wave against journalists. The IACHR and the Office of the Special Rapporteur for Freedom of Expression have called on the Honduran government to take all necessary measures to prevent these murders, protect at-risk journalists, and make progress in investigating the crimes.59 The Inter American Press Association recommended that the Lobo Administration request international technical assistance, establish special prosecutors’ offices, and adopt a number of legal, judicial, and penal reforms.60 Honduran officials have asserted that there is nothing to indicate that journalists are being attacked because of their work, and that the murdered journalists were most likely the victims of the widespread, random crime that has plagued Honduras in recent years.61 Nevertheless, the Honduran government has requested assistance from the United States, Spain, and Colombia in investigating alleged human rights violations, including the killing of journalists.62 The United States has sent advisors from the Federal Bureau of Investigation (FBI), and U.S. officials have indicated they are open to providing additional assistance if needed. 63 International Recognition Following the ouster of President Zelaya, Honduras was diplomatically isolated by the international community. Although trade continued with the exception of a 48-hour blockade by some Central American countries, the Micheletti government was not recognized by a single nation. On July 4, 2009, in accordance with Article 21 of the Inter-American Democratic Charter, the member states of the OAS unanimously voted to suspend Honduras from the organization for an unconstitutional interruption of the democratic order.64 Honduras also lost the support of the international financial institutions, which withheld access to loans and other transfers. 56 Inter-American Commission on Human Rights, Honduras: Human Rights and the Coup D'état, Organization of American States, OEA/Ser.L/V/II. Doc. 55, December 30, 2009; Inter-American Commission on Human Rights, “IACHR Concerned About Human Rights Violations in Honduras,” Press Release, No. 54/10, May 19, 2010. 57 “Honduras: HRN Radio Reporter Killed,” EFE News Service, December 28, 2010. 58 Committee to Protect Journalists, “Journalist Murders Spotlight Honduran Government Failures,” July 27, 2010. 59 Inter-American Commission on Human Rights, “Office of the Special Rapporteur Expresses Concern Over New Attacks Against Journalists and Media in Honduras,” September 20, 2010. 60 Inter American Press Association, “IAPA Makes Recommendations to President Porfirio Lobo to Combat Violence Against Journalists,” Press Release, April 27, 2010. 61 Committee to Protect Journalists, “Journalist Murders Spotlight Honduran Government Failures,” July 27, 2010. 62 “Honduras Pide Ayuda a Colombia, España, y EEUU en Investigación Sobre DDHH,” Agence France Presse, January 27, 2011. 63 “EEUU Prestará Toda la Ayuda Necesaria a Honduras en DDHH (Funcionaria),” Agence France Presse, June 5, 2011. 64 Organization of American States, Resolution on the Suspension of the Right of Honduras to Participate in the OAS, OEA/Ser.P, AG/Res/2 (XXXVII-E/09), Washington, DC, July 4, 2009. Congressional Research Service 12 Honduran-U.S. Relations As a result of the November 2009 election and Lobo’s reconciliation attempts upon taking office, much of the international community—including the United States, the European Union, most Central American nations, and the international financial institutions—quickly recognized the Lobo Administration. Many South American nations, however, expressed concerns that restoring formal relations with Honduras would set a dangerous precedent in the region since Zelaya was never returned to office. They excluded Honduras from regional gatherings and refused to lift the country’s suspension from the OAS.65 Moreover, they indicated that recognition would be dependent on conditions on the ground, including the ability of former President Zelaya to return home peacefully. 66 On June 1, 2011, four days after Zelaya returned from exile, Honduras was finally able to rejoin the OAS. Noting the importance of the “Accord for National Reconciliation and the Consolidation of the Democratic System in Honduras” negotiated between Lobo and Zelaya, the OAS member states voted 32-1 to lift the suspension. 67 Nearly all of the countries that had previously refused to do so also began to restore official ties with Honduras. Ecuador, which was the only country to vote against lifting the suspension, refuses to restore diplomatic relations “so long as those serving in the Honduran government participated in the coup outright and remain in complete impunity.”68 Economic and Social Conditions Background The Honduran economy has experienced significant changes since the 1990s. Traditional agricultural exports of coffee and bananas are still important, but nontraditional sectors, such as shrimp farming and the maquiladora, or export-processing industry, have grown significantly. In 1998, Honduras was devastated by Hurricane Mitch, which killed more than 5,000 people and caused billions of dollars in damage. The gross domestic product declined by 1.4% in 1999, and the country felt the effects of the storm for several years, with roads and bridges washed out, the agricultural sector hard hit, and scores of orphaned children, many of whom joined criminal gangs. Spurred on by substantial U.S. foreign assistance, however, the economy rebounded. Between 2000 and 2008, the country experienced average growth of over 5%.69 Honduras is now classified by the World Bank as a lower middle income developing economy, with a per capita income of $1,800 (2009).70 65 “Honduras: Honduras Cleaves Latin America,” Latin American Regional Report: Caribbean & Central America, May 2010. 66 “Insulza Dice que Reintegro de Honduras a OEA está Atado a Exilio de Zelaya,” Agence France Presse, February 11, 2011. 67 Organization of American States, Participation of Honduras in the Organization of American States, OEA/Ser.P, AG/Res.1 (XLI-E/11), Washington, DC, June 1, 2011. 68 “Ecuador President Won’t Restore Ties with Honduras,” Agence France Presse, June 2, 2011. 69 “Honduras: Country Data,” Economist Intelligence Unit, February 2011. 70 World Bank, “World Development Indicators,” February 2010, available at http://data.worldbank.org/datacatalog/world-development-indicators. Congressional Research Service 13 Honduran-U.S. Relations Over the past decade, Honduras has benefited from several debt-reduction programs. In 2005, Honduras signed a three-year poverty reduction and growth facility agreement with the International Monetary Fund (IMF), making the country eligible for about $1 billion in debt relief under the IMF and World Bank’s Heavily Indebted Poor Countries (HIPC) Initiative. 71 The agreement imposed fiscal and monetary targets on the government, and required Honduras to maintain firm macroeconomic discipline and develop a comprehensive poverty reduction strategy. In 2006, the Inter-American Development Bank (IDB) implemented a debt forgiveness program for its poorest members. Honduras benefitted from a reduction of $1.4 billion in foreign debt, freeing government resources to finance poverty alleviation. 72 Largely as a result of these programs, Honduras’ net public debt declined from nearly 46% of gross domestic product (GDP) in 2005 to about 19.1% in 2007.73 Honduran debt has been climbing again in recent years, however, as increased domestic spending and decreased government revenue have contributed to growing fiscal deficits. Despite experiencing relatively strong growth and benefitting from debt reduction programs, Honduras continues to face significant development challenges. The country remains one of the most impoverished nations in Latin America. According to the most recent household census conducted by the Honduran National Statistics Institute, 60% of Honduras’ 8 million citizens live under the poverty line—defined as being unable to acquire the basic basket of household goods. 74 Likewise, Honduras has an infant mortality rate of 27 per 1,000; chronic malnutrition for one out of four children under five years of age; and a significant HIV/AIDS crisis, with an adult infection rate of 1.5% of the population. The Garifuna community (descendants of freed black slaves and indigenous Caribs from St. Vincent) concentrated in northern coastal areas has been especially hard hit by the HIV/AIDS epidemic. The World Bank maintains that development indicators have improved over the past decade because of increased public spending on health and education, but further progress is uncertain. It notes that the country remains vulnerable to external shocks, including declines in prices for agricultural exports and natural disasters such as hurricanes and droughts.75 Crises and Recovery The global financial crisis and domestic political crisis took a significant toll on the Honduran economy. Honduras was already experiencing significant declines in remittances, tourism, and export earnings as a result of the financial crisis prior to President Zelaya’s expulsion from the country.76 The ouster exacerbated these economic problems, as the international community, 71 For more information on the HIPC Initiative, see CRS Report RL33073, Debt Relief for Heavily Indebted Poor Countries: Issues for Congress, by Martin A. Weiss. 72 “Honduras: Country Report,” Economist Intelligence Unit, April 2007; Nestor Ikeda, “Inter-American Development Bank Forgives Debt of 5 Nations,” Associated Press, March 17, 2007. 73 “Honduras: Country Report,” Economist Intelligence Unit, November 2010. 74 “Honduras: Poverty Drives Lobo’s Calls for Constitutional Change,” Latin American Economy & Business, October 2010. 75 U.N. Economic Commission for Latin America and the Caribbean, “Social Panorama of Latin America,” 2009; World Bank, “Honduras Country Brief,” April 22, 2010; World Food Programme, “Country Programme – Honduras,” 2008. Also see CRS Report RL32713, Afro-Latinos in Latin America and Considerations for U.S. Policy, by Clare Ribando Seelke and June S. Beittel. 76 “Honduras: Struggling,” Latin American Economy & Business, October 2009; “Honduras Economy: Political Crisis Takes its Toll,” Economist Intelligence Unit, October 27, 2009. Congressional Research Service 14 Honduran-U.S. Relations which had been expected to finance 20% of the country’s budget, imposed a series of economic sanctions on Honduras.77 International financial institutions withheld access to some $485 million in loans and other transfers, the European Union and United States terminated $126 million in aid, and Venezuela—which provided 50% of Honduras’ petroleum imports in 2008—stopped supplying the country with subsidized oil. 78 Domestic opponents of the ouster placed additional pressure on the economy, engaging in strikes, transportation blockades, and other measures designed to paralyze economic activity.79 Curfews implemented by the Micheletti government to suppress demonstrations by the political opposition further inhibited economic activity as workers were unable to reach their places of employment. The Truth and Reconciliation Commission estimates that the total economic cost of the political crisis was $1.09 billion.80 Overall, the Honduran economy contracted by 2.1% in 2009.81 Since taking office, President Lobo has pushed for reforms designed to restore macroeconomic stability, strengthen public finances, and encourage sustained economic growth. The Honduran National Congress has approved several of Lobo’s proposals, including an energy reform intended to better target subsidies to the poor, and a comprehensive tax reform expected to generate additional revenue equivalent to 2.5% of GDP. The National Congress also approved a measure de-indexing teachers’ wages from changes in the minimum wage in an effort to slow the growth of expenditure on public sector salaries, which absorb 73% of all government revenue.82 To attract foreign direct investment, the Honduran National Congress has approved a law on public-private partnerships, a temporary employment scheme, and the creation of special development areas, or “charter cities.”83 Lobo’s fiscal reforms have been criticized by business groups and public sector workers, however, they have been supported by the international financial institutions that are currently providing Honduras with much needed development financing. In October and November 2010, the International Monetary Fund (IMF), the Inter-American Development Bank (IDB), and the World Bank approved a combined $322.5 million in financial support for Honduras. The funds are to be used in support of the Lobo Administration’s efforts to improve the country’s long-term fiscal balance and implement the reforms necessary to achieve the country’s poverty reduction and growth objectives.84 The Honduran economy has begun to slowly recover from the 2009 77 Keny López de Carballo, “Honduras No Puede Prescindir de Créditos,” La Prensa Grafica (El Salvador), July 9, 2009. 78 Robin Emmott, “Aid Freeze in Post-Coup Honduras Hurting Poor,” Reuters, November 12, 2009; “Honduras Can’t Touch IMF Resources—IMF” Reuters, September 9, 2009; “Unión Europea Suspende Ayuda Financiera a Honduras,” Reuters, July 20, 2009; “Senior State Department Officials Hold Background News Teleconference on Honduras,” CQ Newsmaker Transcripts, September 3, 2009; “Venezuela Halts Oil Deliveries to Honduras,” EFE News Service, July 8, 2009; “Negociación Solo es para que Zelaya Enfrente la Justicia,” El Heraldo (Honduras), July 7, 2009. 79 “Manifestantes Aseguran que Hoy Paralizan el País,” El Tiempo (Honduras), July 23, 2009. 80 Comisión de la Verdad y la Reconciliación (CVR), Para que los Hechos No se Repitan: Informe de la Comisión de la Verdad y la Reconciliación, San José, Costa Rica, July 2011, http://www.cvr.hn/home/noticias/hojas-de-prensa/paraque-los-hechos-no-se-repitan-informe-de-la-comision-de-la-verdad-y-la-reconciliacion-cvr/. 81 “Honduras: Country Report,” Economist Intelligence Unit, January 2011. 82 “Honduras: Country Report,” Economist Intelligence Unit, December 2010; International Monetary Fund, Honduras: Letter of Intent, Memorandum of Economic and Financial Policies, and Technical Memorandum of Understanding, September 10, 2010. 83 “Country Watch: Honduras,” Economist Intelligence Unit, June 13, 2011. 84 “Tracking Trends: Honduras IMF Loan,” Latin News Weekly Report, October 14, 2010; “BID y BM Conceden Préstamos por más de USD 120 Millones a Honduras,” Agence France Presse, November 10, 2010. Congressional Research Service 15 Honduran-U.S. Relations financial and political crises. GDP grew by 2.8% in 2010 and is expected to grow by 3.8% in 2011.85 Unemployment remains a challenge, however, as over 16% of Hondurans lack formal jobs.86 Issues in U.S.-Honduran Relations The United States has had close relations with Honduras over many years. The bilateral relationship became especially close in the 1980s when Honduras returned to democratic rule and became the lynchpin for U.S. policy in Central America. At that time, the country became a staging area for U.S.-supported excursions into Nicaragua by the Contra forces attempting to overthrow the leftist Sandinista government. Economic linkages also intensified in the 1980s after Honduras became a beneficiary of the Caribbean Basin Initiative, which provided duty-free importation of Honduran goods into the United States. Bilateral economic ties have further expanded since the entrance into force of the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR) in 2006. Relations between the United States and Honduras were strained in 2009 because of the country’s political crisis. Following Zelaya’s ouster, the United States cut off almost all contact with the Honduran government. It suspended some foreign assistance, minimized cooperation with the Honduran military, and revoked the visas of members and supporters of the Micheletti government, which assumed power following Zelaya’s removal. 87 Micheletti reacted angrily to U.S. policy toward his government, declaring, “it isn’t possible for anyone, no matter how powerful they are, to come over here and tell us what we have to do.”88 Relations have improved considerably since the inauguration of President Lobo, whose efforts to foster national reconciliation and solidify democratic processes in Honduras led the United States to restore foreign assistance and resume cooperation on other issues. Current U.S. policy objectives in Honduras include (1) improving the human-rights climate, especially regarding allegations that journalists and other individuals have been targeted for their political views; (2) combating high levels of corruption, crime, and drug-trafficking; and (3) promoting and implementing social and economic reforms to boost growth and reduce poverty and inequality levels that are among the highest in the hemisphere. 89 To advance these policy objectives, the United States provides Honduras with substantial amounts of foreign assistance, maintains significant military and economic ties, and engages on transnational issues such as migration, crime, narcotics trafficking, trafficking in persons, and port security. 85 “Honduras: Country Report,” Economist Intelligence Unit, June 2011. “Honduras: President Lobo Wrestles with Intractables,” Latin American Economy & Business, June 2011. 87 “Senior Administration Officials Hold State Department Background Briefing via Teleconference on Honduras,” CQ Newsmaker Transcripts, June 28, 2009; U.S. Department of State, Office of the Spokesman, “Termination of Assistance and Other Measures Affecting the De Facto Regime in Honduras,” September 3, 2009; U.S. Department of State, Office of the Spokesman, “Revocation of Diplomatic Visas,” July 28, 2009. 88 Carlos Salinas, “Honduran De Facto Leader Vows to Cling to Power Over US Objections,” El País (Spain), August 5, 2009. 89 Testimony of Craig Kelly, Principal Deputy Assistant Secretary of State for Western Hemisphere Affairs, U.S. Department of State, before the House Subcommittee on the Western Hemisphere, March 18, 2010. 86 Congressional Research Service 16 Honduran-U.S. Relations Foreign Assistance The United States has provided considerable amounts of foreign assistance to Honduras over the past three decades. In the 1980s, the United States provided about $1.6 billion in economic and military aid as the country struggled amid the region’s civil conflicts. In the 1990s, U.S. assistance to Honduras began to wane as regional conflicts subsided and competing foreign assistance needs grew in other parts of the world. Hurricane Mitch changed that trend as the United States provided almost $300 million in assistance to help the country recover from the 1998 storm. As a result of the influx of aid, total U.S. assistance to Honduras for the 1990s amounted to around $1 billion. With Hurricane Mitch funds expended by the end of 2001, U.S. foreign aid levels to Honduras again began to decline. Recent foreign aid funding to Honduras amounted to $40.5 million in FY2008, $40.2 million in FY2009, and $50.2 million in FY2010. The Obama Administration requested $67.9 million for Honduras in FY2011; however, country-specific funding levels, as appropriated through the Department of Defense and Full-Year Continuing Appropriations Act, 2011 (P.L. 112-10) are not yet available. For FY2012, the Obama Administration has requested nearly $68 million in foreign aid for Honduras, including $55 million in Development Assistance (DA), $11 million in Global Health and Child Survival assistance (GHCS), and $1 million in Foreign Military Financing (FMF). (See Table 1 below.) U.S. assistance supports a variety of projects designed to enhance security, strengthen democracy, improve education and health systems, conserve the environment, and build trade capacity. Most assistance to the country is managed by the U.S. Agency for International Development (USAID) and the State Department. Table 1. U.S. Bilateral Assistance to Honduras, FY2008-FY2012 (U.S. $ in thousands) Account FY2008 FY2009 FY2010 FY2011(req)a FY2012(req) Development Assistance (DA) 15,149 21,382 37,491 53,934 55,266 Global Health and Child Survival (GHCS) (USAID) 12,035 11,750 11,000 11,000 10,000 Global Health and Child Survival (GHCS) (State) 1,000 1,000 1,000 1,000 1,000 10,150 5,771 0 0 0 International Narcotics & Law Enforcement (INCLE) 744 0 0 0 0 International Military Education and Training (IMET) 936 329 700 700 700 Foreign Military Financing (FMF) 496 0 0 1,300 1,000 40,510 40,232 50,191 67,934 67,966 Food for Peace Title II (P.L. 480) Total Sources: U.S. Department of State, Congressional Budget Justification for Foreign Operations, Fiscal Year 2012, April 11, 2011; U.S. Department of State, Congressional Budget Justification for Foreign Operations, Fiscal Year 2010, May 28, 2009. Notes: Global Health and Child Survival (USAID) was formerly called “Child Survival and Health,” but was relabeled with the FY2010 budget request. Likewise, Global Health and Child Survival (State) was formerly called “Global HIV/AIDS Initiative,” but was re-labeled with the FY2010 budget request. a. Although the Department of Defense and Full-Year Continuing Appropriations Act, 2011 (P.L. 112-10) was signed into law on April 15, 2011, country-specific funding levels are not yet available. Congressional Research Service 17 Honduran-U.S. Relations Honduras receives some foreign assistance beyond the bilateral funds listed above. The Peace Corps, which has been active in the country since 1963, provides nearly 180 volunteers to work on projects related to HIV/AIDS prevention and child survival; protected area management; water and sanitation; and business, municipal and youth development. The Millennium Challenge Corporation (MCC) provided Honduras with $205 million90 for a five-year economic growth compact that was completed in September 2010. The compact had two components: a rural development project to provide farmers with skills to grow and market new crops, and a transportation project to improve roads and highways to link farmers and other businesses to ports and major production centers in Honduras.91 USAID’s Office of Foreign Disaster Assistance (OFDA) provides assistance in response to natural disasters. USAID/OFDA provided Honduras with $150,000 to respond to flooding and other damage during the 2010 hurricane season.92 Honduras also receives assistance under the Central America Regional Security Initiative (CARSI, formerly known as Mérida-Central America), a package of counternarcotics and anticrime assistance for the region.93 From FY2008-FY2010, Congress appropriated $260 for CARSI, a portion of which was intended for Honduras. For FY2012, the Obama Administration has requested $100 million for CARSI. Military Cooperation The United States maintains a troop presence of about 600 military personnel known as Joint Task Force (JTF) Bravo at Soto Cano Air Base. JTF Bravo was first established in 1983 with about 1,200 troops who were involved in military training exercises and in supporting U.S. counterinsurgency and intelligence operations in the region. In the aftermath of Hurricane Mitch in 1998, U.S. troops provided extensive assistance in the relief and reconstruction effort. Today, U.S. troops in Honduras support such activities as disaster relief, medical and humanitarian assistance, counternarcotics operations, and search and rescue operations that benefit Honduras and other Central American countries. Regional exercises and deployments involving active duty and reserve components also provide training opportunities for thousands of U.S. troops. The June 28, 2009, ouster of President Manuel Zelaya led some to reassess the state of U.S.Honduran military cooperation. As a result of the Honduran military’s role in Zelaya’s removal, the United States suspended joint military activities as well as some military assistance to the country.94 The events in Honduras also led some analysts to question the effectiveness of U.S. foreign military training programs. They argued that such programs have not obtained their desired outcomes given that General Romeo Vasquez Velasquez, who had received U.S. training, led the effort to remove President Zelaya, and the Honduran military reportedly cut off contact 90 The compact was originally for $215 million, but the final $10 million was terminated as a result of the 2009 political crisis. 91 Millennium Challenge Corporation, “Honduras Overview,” available at http://www.mcc.gov/countries/honduras/ index.php. 92 USAID, Latin America and the Caribbean—Hurricane Season and Floods, Fact Sheet #6, FY2011, November 9, 2010. 93 For more information, see CRS Report R41731, Central America Regional Security Initiative: Background and Policy Issues for Congress, by Peter J. Meyer and Clare Ribando Seelke. 94 John J. Kruzel, “U.S. Limits Contact with Honduran Military,” American Forces Press Service, July 2, 2009; U.S. Department of State, Office of the Spokesman, “U.S. Assistance to Honduras,” July 7, 2009. Congressional Research Service 18 Honduran-U.S. Relations with the United States prior to the ouster. 95 Nevertheless, U.S.-Honduran military cooperation resumed following the election of President Lobo, with the United States restoring aid and training efforts.96 The United States also resumed funding the construction of a Honduran naval base on the island of Guanaja, which—together with a naval base constructed in Caratasca in 2009—is designed to enhance Honduras’ capacity to detect and interdict illicit drug shipments.97 Trade and Investment U.S. trade and investment linkages with Honduras have increased greatly since the early 1980s. In 1984, Honduras became one of the first beneficiaries of the Caribbean Basin Initiative (CBI), a unilateral U.S. preferential trade arrangement providing duty-free importation for many goods from the region. In the late 1980s, Honduras benefitted from production-sharing arrangements with U.S. apparel companies for duty-free entry into the United States of certain apparel products assembled in Honduras. As a result, maquiladoras or export-assembly companies flourished, most concentrated in the north coast region. The passage of the Caribbean Basin Trade Partnership Act in 2000, which provided Caribbean Basin nations with North America Free Trade Agreement (NAFTA)-like preferential tariff treatment, further boosted the maquila sector. Trade relations expanded most recently as a result of the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR), which has significantly liberalized trade in goods and services since entering into force with Honduras in April 2006.98 Total trade between the United States and Honduras has increased 15% since the implementation of CAFTA-DR, with U.S. exports to Honduras growing by 25% and U.S. imports from Honduras growing by 6%. Total two-way trade amounted to $8.5 billion in 2010, $4.6 billion in U.S. exports to Honduras and $3.9 billion in U.S. imports from Honduras. Similar to previous trade arrangements, CAFTA-DR has provided substantial benefits to the maquila sector. Knit and woven apparel (assembled products from the maquila sector) account for the greatest share of U.S. imports from Honduras. Likewise, apparel inputs, such as yarns and fabrics, account for a substantial portion of U.S. exports to Honduras. Other major U.S. exports to Honduras include oil and machinery.99 U.S. foreign direct investment in Honduras has also increased since the implementation of CAFTA-DR. Total U.S. foreign direct investment amounted to $844 million in 2009, up 7% from $787 million in 2006.100 The most significant U.S. investments are in the maquila, manufacturing, tourism, agriculture, telecommunications, and energy sectors. According to the U.S. State Department, relatively low labor costs, proximity to the U.S. market, and Central America’s largest port (Puerto Cortés) make Honduras attractive to investors. On the other hand, high levels of crime, a weak judicial system, corruption, low levels of educational attainment, and poor 95 See, for example, Adam Isacson, “When Your Aid Recipients Stop Taking Your Calls,” Center for International Policy, June 28, 2008, http://www.cipcol.org/?p=949. 96 “Honduras: Ties with US Return to Normal,” Latin News Weekly Report, April 22, 2010. 97 “Central America: Behind the Growing Presence of the US,” Latin American Security & Strategic Review, July 2010. 98 For more information on CAFTA-DR, see CRS Report RL31870, The Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR), by J. F. Hornbeck. 99 U.S. Department of Commerce data, as presented by Global Trade Atlas, April 2011. 100 U.S. Department of Commerce, “U.S. Direct Investment Abroad Tables,” Survey of Current Business, September 2010. Congressional Research Service 19 Honduran-U.S. Relations infrastructure hamper investment. 101 Additionally, some observers have raised questions about the investment climate in Honduras as a result of several cases where U.S.-owned companies have been driven out of business as a result of anticompetitive practices or have been expropriated without compensation.102 On June 15, 2011, a bill (H.R. 2200, Rohrabacher) was introduced to limit U.S. assistance to Honduras unless the President certifies that the Government of Honduras has settled all outstanding expropriation claims brought by U.S. companies. Despite the increases in trade and investment, some analysts have expressed concerns about the implementation of CAFTA-DR. Labor rights provisions have been of particular concern to many in the United States. According to the U.S. State Department, Honduran labor laws are generally satisfactory, however, the government frequently fails to enforce them. In the past year, “union leaders were subjected to violence and threats,” “employers commonly threatened to close unionized factories and harassed or dismissed workers seeking to unionize,” and “factory management in export-processing zones required compulsory overtime, with some factories enforcing this requirement by locking workers inside.”103 Honduran officials, on the other hand, have expressed concerns about the potential loss of agricultural jobs in the corn, rice, beef, pork, and poultry sectors as the country further opens its market to U.S. agricultural products.104 Migration Issues Temporary Protected Status In the aftermath of Hurricane Mitch in 1998, the United States provided temporary protected status (TPS) to eligible Hondurans who may otherwise have been deported from the United States. Originally slated to expire in July 2000, TPS status has now been extended nine times. The most recent TPS extension came on May 5, 2010, when the Secretary of Homeland Security announced that the United States would continue to provide TPS for an additional 18 months, expiring on January 5, 2012 (prior to this extension, TPS would have expired July 5, 2010). According to a Federal Register notice on the most recent extension, the Secretary of Homeland Security maintained that the extension was warranted because there continues to be a substantial, but temporary, disruption of living conditions in Honduras resulting from Hurricane Mitch, and the country remains temporarily unable to adequately handle the return of its nationals.105 Homeland Security estimates that TPS covers an estimated 66,000 Hondurans residing in the United States.106 101 U.S. Department of State, Bureau of Economic, Energy and Business Affairs, 2011 Investment Climate Statement Honduras, March 2011. 102 U.S. Congress, House Committee on Foreign Affairs, Subcommittee on the Western Hemisphere, Next Steps for Honduras, 111th Cong., 2nd sess., March 18, 2010, Serial No. 111-94 (Washington: GPO, 2010). 103 U.S. Department of State, Bureau of Democracy, Human Rights and Labor, 2010 Country Reports on Human Rights Practices – Honduras, April 8, 2011. 104 Kathleen Schalch, "Hondurans Brace for Pros, Cons of CAFTA," National Public Radio (NPR), May 19, 2005. 105 For more details, see 75 Federal Register 24734-24737, May 5, 2010. 106 “18-Month Extension of Temporary Protected Status for Honduras, Questions and Answers,” States News Service, May 5, 2010. See CRS Report RS20844, Temporary Protected Status: Current Immigration Policy and Issues, by Ruth Ellen Wasem and Karma Ester. Congressional Research Service 20 Honduran-U.S. Relations Remittances Remittances from migrant workers abroad—87% of whom live in the United States—are the largest single source of foreign exchange for Honduras. Between 2002 and 2008, remittances to Honduras more than tripled to $2.7 billion, the equivalent of 20% of GDP. Although remittances declined by over 8% in 2009, they partially recovered in 2010 to $2.53 billion. The recent decline in remittances is at least partially due to the global financial crisis and U.S. recession, which have left many Honduran immigrants in the United States unemployed. Most remittances from Hondurans abroad are sent to immediate family members, such as parents and children, to supplement their wages.107 In September 2010, Secretary of State Clinton signed a Memorandum of Understanding with President Lobo regarding the Building Remittance Investment for Development Growth and Entrepreneurship (BRIDGE) Initiative. Under the Initiative, the United States will work with Honduras to develop and support partnerships with Honduran financial institutions in hopes of maximizing the development impact of remittance flows. The identified financial institutions will be able to leverage the remittances they receive to obtain lower-cost, longer-term financing in international capital markets to fund investments in infrastructure, public works, and commercial development.108 Deportations109 Deportations to Honduras have increased significantly over the past decade. Approximately 25,600 Hondurans were deported from the United States in FY2010, making Honduras one of the top recipients of deportees on a per capita basis.110 Increasing deportations from the United States have been accompanied by similar increases in deportations from Mexico, a transit country for Central American migrants bound for the United States. Honduran policymakers are concerned about their country’s ability to absorb the large volume of deportees, as it is often difficult for those returning to the country to find gainful employment. Individuals who do not speak Spanish, who are tattooed, who have criminal records, and/or who lack familial support face additional difficulties re-integrating into Honduran society. In addition to these social problems, leaders are concerned that remittances may start to fall if the current high rates of deportations continue. 111 Some analysts contend that increasing U.S. deportations of individuals with criminal records has exacerbated the gang problem in Honduras and other Central American countries. By the mid1990s, the civil conflicts in Central America had ended and the United States began deporting unauthorized immigrants, many with criminal convictions, back to the region. Between 2000 and 107 “Honduras: Moderate Inflation,” Latin American Economy & Business, February 2011; “Honduras: Country Report,” Economist Intelligence Unit, November 2010; “Roundtable Discussion: Outlook for Remittances to Latin America in 2010,” Inter American Dialogue, April 12, 2010; “Latin America: Remittances Slide,” Economist Intelligence Unit, January 26, 2009; “Country Profile: Honduras,” Economist Intelligence Unit, 2008. 108 Department of State, Office of the Spokesman, “U.S. BRIDGE Initiative Commitments with El Salvador and Honduras,” September 22, 2010. 109 Clare Ribando Seelke, Specialist in Latin American Affairs, contributed information to this section. 110 Information provided to CRS by the Department of Homeland Security, Immigration and Customs Enforcement, Office of Congressional Relations. 111 Pamela Constable, “Deportees’ Bittersweet Homecoming; Migration is Boon, Bane for Honduras,” Washington Post, June 27, 2007. Congressional Research Service 21 Honduran-U.S. Relations 2004, an estimated 20,000 criminals were sent back to Central America, many of whom had spent time in prisons in the United States for drug and/or gang-related offenses. Some observers contend that gang-deportees have “exported” a Los Angeles gang culture to Central America, and that they have recruited new members from among the local populations.112 Although a recent United Nations study found little conclusive evidence to support their claims, the media and many Central American officials have attributed a large proportion of the rise in violent crime in the region to gangs, particularly gang-deportees from the United States.113 U.S. Immigration and Customs Enforcement (ICE) does not provide receiving countries with the complete criminal records or gang affiliations of deportees, however, it may provide them with some information regarding deportees’ criminal histories and gang affiliations when specifying why the deportees were removed from the United States. Likewise, receiving countries may contact the FBI to request criminal history checks on particular criminal deportees once they have arrived. Over 40% of the Hondurans deported from the United States in FY2010 were removed on criminal grounds. 114 Crime, Violence, and Drug Trafficking115 Honduras, along with neighboring El Salvador and Guatemala, has become fertile ground for gangs and drug trafficking organizations. Fueled by poverty, unemployment, leftover weapons from the conflicts of the 1980s, and the U.S. deportation of criminals to the region, gangs such as Mara Salvatrucha (MS-13) and the 18th Street Gang (M-18) have firmly established themselves in the region. Although estimates of the number of gang members vary widely, the U.N. Office on Drugs and Crime (UNODC) has suggested that there are some 36,000 in Honduras.116 At the same time, Mexican Drug Trafficking Organizations (DTOs) have taken control of Central American trafficking corridors to transport cocaine and other narcotics from the Andean region of South America to the United States. This confluence of gangs and DTOs has led to increasing rates of crime and violence. According to Vanderbilt University’s 2010 Americas Barometer, 14% of Honduran citizens reported that they had been the victim of a crime within the past year.117 The surge in violent crime has been particularly worrisome. In December 2009, Honduras’ top counternarcotics official was ambushed and killed in the capital by gunmen on motorcycles. In September 2010, 18 men working in a shoe factory in San Pedro Sula were apparently massacred by members of a Mexican DTO. And in January 2011, eight people were killed and three were injured when gunmen opened fire on a public bus.118 Honduras’ murder rate was already among the highest in 112 Ana Arana, “How the Street Gangs Took Central America,” Foreign Affairs, May/June 2005. United Nations Office on Drugs and Crime (UNODC), Crime and Development in Central America: Caught in the Crossfire, May 2007. 114 Information Provided to CRS by the Department of Homeland Security, Immigration and Customs Enforcement, Office of Congressional Relations. 115 For more information see CRS Report R41731, Central America Regional Security Initiative: Background and Policy Issues for Congress, by Peter J. Meyer and Clare Ribando Seelke and CRS Report RL34112, Gangs in Central America, by Clare Ribando Seelke. 116 United Nations Office on Drugs and Crime (UNODC), Crime and Development in Central America: Caught in the Crossfire, May 2007. 117 “65% Satisfecho con Democracia,” La Prensa (Honduras), November 23, 2010. 118 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, “International Narcotics (continued...) 113 Congressional Research Service 22 Honduran-U.S. Relations the world in 2008 at 57.9 per 100,000 inhabitants. Nevertheless, it increased to 66.8 per 100,000 in 2009 and reportedly reached 77 per 100,000 in 2010.119 Many have assumed that gangs are responsible for the increasing number of homicides; however, some recent studies have shown that the highest murder rates are not in large cities—where gangs are primarily located—but in more remote areas along strategic drug trafficking corridors. Although there have been some indications that DTOs are using gangs as hired assassins in Honduras, connections between the DTOs and gangs remain largely anecdotal and unsubstantiated.120 Honduran Security Efforts Recent Honduran presidents have implemented varying anti-crime strategies; however, none of them have achieved much success. During his term, President Ricardo Maduro (2002-2006) increased the number of police officers and signed legislation that made maras (street gangs) illegal and gang membership punishable with 12 years in prison. Although the crackdown won popular support and initially reduced crime, its success was short-lived. Following his election, President Zelaya (2006-2009) replaced the previous administration’s zero-tolerance policy with dialogue and other outreach techniques designed to persuade gang members to reintegrate into society.121 Failure to achieve concrete results, however, led the Zelaya Administration to shift its emphasis toward more traditional anti-gang law enforcement operations. Zelaya increased the number of police and military troops in the streets and conducted raids against suspected criminals. Nonetheless, crime and violence in Honduras continued unabated (as reflected in the statistics cited above). 122 President Lobo has pledged to crack down on crime and violence, and although he has backed away from his 2005 proposal to reinstate the death penalty, he still favors a hard-line approach. Since taking office, Lobo has deployed army troops into the streets to assist in policing and won legislative approval for several criminal justice reforms. In November 2010, the Honduran National Congress approved a new anti-terrorism law that is designed to strengthen control over land, sea, and air borders, and allow authorities to better control cash flows into the country. 123 The Congress approved another legal reform in March 2011, which lengthened prison terms.124 In June 2011, Lobo won congressional approval for a tax package designed to raise $79 million (...continued) Control Strategy Report,” March 2010; “Gang Massacre Appalls Honduras,” Latin News Daily, September 8, 2010, “Bus Massacre in Honduras,” Latin News Daily, January 7, 2011. 119 This is four times the average homicide rate in Latin America of 18 per 100,000 inhabitants. “Honduras Report Signals Rising Violence,” Latin News Daily, February 22, 2009; “Honduras has Highest Murder Rate in Central America,” EFE News Service, March 30, 2010; “Honduras Posts Startling Homicide Rate,” Latin News Daily, January 18, 2011. 120 Steven S. Dudley, Drug Trafficking Organizations in Central America: Transportistas, Mexican Cartels and Maras, Woodrow Wilson International Center for Scholars, May 2010. 121 “Honduran Government Reaches Out to Rehabilitate Gangs,” ACAN-EFE, January 30, 2006. 122 Marion Barbel, “Homicide Rate Confirms Honduras as One of Region’s Most Violent Nations,” Global Insight Daily Analysis, September 11, 2008. 123 “Honduras Denounces Internal Armed Groups,” Latin News Daily, November 24, 2010. 124 Noé Leiva, “Gobierno de Honduras Ordena Desplegar a Militares para Combatir el Crimen,” Reuters, March 1, 2011. Congressional Research Service 23 Honduran-U.S. Relations annually to fund security efforts, and a constitutional reform that will allow the government to detain individuals for up to 48 hours without bringing them before a judge. 125 U.S. Cooperation Although security cooperation was temporarily disrupted by the 2009 political crisis, communication and coordination between U.S. law enforcement and intelligence entities and Honduras military and police elements have improved since President Lobo took office. A highlevel task force, co-chaired by President Lobo and the U.S. Ambassador, convenes quarterly to oversee and direct coordination on security sector efforts. Through the Central America Regional Security Initiative (CARSI)126 and other efforts, the United States supports a variety of anticorruption, anti-gang, police training, institution building, and maritime operations programs intended to prevent crime and improve Honduras’ counternarcotics capabilities. In 2010, joint counternarcotics operations led to an increase in seizures of bulk cash and most illegal drugs. 127 Likewise, a U.S.-vetted Honduran police unit seized a cocaine processing laboratory in March 2011, the first ever discovered in Central America.128 Despite these accomplishments, some analysts have raised serious concerns about criminal infiltration of the Honduran government, which could impede future cooperation. A former member of Honduras’ Council Against Drug Trafficking reportedly has estimated that 10% of the Honduran National Congress is linked to drug traffickers.129 Recent reports also suggest that U.S. arms sold to Honduras in the past have turned up in the hands of criminal groups in Colombia and Mexico.130 According to the U.S. State Department, corruption continues to pose a challenge to Honduras and institutional changes will need to be made in order for the country to successfully expel traffickers from its territory. 131 Human Trafficking According to the State Department’s 2011 Trafficking in Persons (TIP) Report, Honduras is primarily a source and transit country for men, women, and children trafficked for the purpose of commercial sexual exploitation and forced labor. Many victims are recruited from rural areas with promises of employment and later subjected to forced prostitution in urban and tourist locales such as Tegucigalpa, San Pedro Sula, and the Bay Islands. Destination countries for trafficked Honduran women and children include Belize, El Salvador, Guatemala, Mexico, and the United States. There are also foreign victims of commercial sexual exploitation in Honduras, most 125 “Honduras Approves New Tax to Boost Drug Fight,” Reuters, June 23, 2011; “Pese a Advertencia de Ministerio DDHH: Reforman la Constitución para Detener a Ciudadanos por 48 Horas,” El Tiempo (Honduras), June 23, 2011. 126 CARSI is a package of counternarcotics and anticrime assistance for Central America, for which Congress appropriated $260 million from FY2008-2010. For more information, see CRS Report R41731, Central America Regional Security Initiative: Background and Policy Issues for Congress, by Peter J. Meyer and Clare Ribando Seelke. 127 U.S. Department of State, Bureau of International Narcotics and Law Enforcement Affairs, 2011 International Narcotics Control Strategy Report (INCSR), March 3, 2011. 128 “Honduras Discovers First Mexican-Made Cocaine Lab,” Reuters, March 9, 2011. 129 Tim Johnson, “Drug Gangs Muscle Into New Territory: Central America,” McClatchy Newspapers, April 21, 2011. 130 Geoffrey Ramsey, “Cable: Honduran Military Supplied Weaponry to Cartels,” InSight: Organized Crime in the Americas, April 25, 2011. 131 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International Narcotics Control Strategy Report, March 3, 2011. Congressional Research Service 24 Honduran-U.S. Relations having been trafficked from neighboring countries, including economic migrants en route to the United States. According to a Honduran non-governmental organization, 10,000 children in Honduras are victims of commercial sexual exploitation and some 500,000 are subject to child labor.132 The State Department maintains that Honduras does not fully comply with the minimum standards for the elimination of trafficking, however, it notes that the government is making significant efforts to do so. As a result, Honduras is considered a so-called “Tier 2” country. The 2011 report recognized the Honduran government’s law enforcement actions against child sex traffickers, the creation of a draft comprehensive anti-trafficking law, and the launch of an antitrafficking hotline. On the other hand, the report maintained that the Honduran government provided minimal services for trafficking victims, that laws failed to prohibit trafficking for forced labor, and that the number of trafficking-related convictions had decreased. The State Department report provides a number of recommendations for Honduras. These include passing a comprehensive anti-trafficking law that prohibits forced labor; increasing efforts to investigate and prosecute trafficking offenses; ensuring that specialized services and shelter are available to trafficking victims; and developing formal procedures for identifying and assisting victims. 133 Port Security Honduras and the United States have cooperated extensively on port security. For the United States, port security emerged as an important element of homeland security in the aftermath of the September 11, 2001, terrorist attacks. Honduras views such cooperation as important in order to ensure the speedy export of its products to the United States, which in turn could increase U.S. investment in the country. In March 2006, U.S. officials announced the inclusion of the largest port in Honduras, Puerto Cortés, in the U.S. Container Security Initiative (CSI). CSI is operated by the U.S. Customs and Border Protection (CBP) of the Department of Homeland Security, and uses a security regime to ensure that all containers that pose a potential risk for terrorism are identified and inspected at foreign ports before they are placed on vessels destined for the United States. Honduras also participates in the Department of Energy’s Megaports Initiative, which supplies ports with equipment capable of detecting nuclear or radioactive materials, and the Secure Freight Initiative (SFI), which deploys equipment capable of scanning containers for radiation and information risk factors before they are allowed to depart for the United States. Puerto Cortés was one of six ports around the world chosen to be part of the first phase of the SFI.134 132 “Casa Alianza: En Honduras 10,000 Niños Sufren Explotación Sexual,” El Tiempo (Honduras), June 11, 2011. U.S. Department of State, Office to Monitor and Combat Trafficking in Persons, Trafficking in Persons Report, June 2011. 134 U.S. Department of Homeland Security, “DHS and DOE Launch Secure Freight Initiative,” Press Release, December 7, 2006, and “Secure Freight Initiative Becomes Fully Operational in United Kingdom, Pakistan, and Honduras,” Press Release, October 12, 2007. 133 Congressional Research Service 25 Honduran-U.S. Relations Author Contact Information Peter J. Meyer Analyst in Latin American Affairs pmeyer@crs.loc.gov, 7-5474 Acknowledgments Mark P. Sullivan, Specialist in Latin American Affairs, contributed to this report. Congressional Research Service 26 Congressional Research Service 5 Honduran-U.S. Relations electoral rolls are artificially inflated—distorting the turnout rate—as a result of Honduras not purging the rolls of those who have died or migrated abroad.24 Lobo Administration (2010-Present) Porfirio Lobo was inaugurated president of Honduras in January 2010, assuming power after seven months of domestic political crisis and international isolation that had resulted from the June 2009 ouster of President Zelaya. Over half way through his four-year term, President Lobo continues to face daunting challenges. His efforts to lead Honduras out of the country’s political crisis have produced mixed results. While initiatives such as the creation of a truth commission, the passage of a political reform measure, and an agreement to allow former President Zelaya to return to the country have won support from the international community, they have only partially reduced domestic polarization. Lobo’s popularity has also suffered as a result of the perception that the government has made little progress in addressing the public’s most pressing concerns: deteriorating security conditions and high levels of unemployment and poverty. Although the strength of Lobo’s National Party in the legislature has enabled his administration to secure passage of several policies designed to address these issues, Hondurans have seen few improvements thus far (see “Security and Human Rights Conditions” and “Economic and Social Conditions” below). Consequently, 68% of Hondurans believe Lobo has done little or nothing to resolve the demands of the population.25 Political Reconciliation President Lobo has taken a number of steps to ease political polarization in Honduras. After being inaugurated in late January 2010, Lobo arranged safe passage out of the country for former President Zelaya26 and immediately signed a bill providing political amnesty to Zelaya and those who removed him from office. The amnesty covers political and common crimes committed prior to and after the removal of Zelaya, but does not include acts of corruption or violations of human rights.27 President Lobo also appointed a national unity cabinet with representatives of each of the five political parties holding seats in the National Congress, and pledged to engage in dialogue with all sectors of Honduran society. Additionally, Lobo established a truth commission that investigated the events surrounding the 2009 ouster, passed a constitutional reform to grant greater power to citizen initiatives, and forged an agreement with former President Zelaya that facilitated his return to Honduras. Truth Commission In April 2010, President Lobo established a Truth and Reconciliation Commission (Comisión de la Verdad y la Reconciliación) to investigate the events surrounding the ouster of President Zelaya 24 “Honduras: Tug of War Between Opposition and De Facto Regime Regarding Flow of Voters,” Latin America Data Base, NotiCen, December 3, 2009; “Final Results in Honduras,” Latin News Daily, December 22, 2009. 25 Universidad Centroamericana José Simeón Cañas (UCA) and Equipo de Reflexión, Investigación y Comunicación, Compañía de Jesús (ERIC-SJ), Percepciones Sobre la Situación Hondureña en el Año 2011, January 2012, http://www.enlaceacademico.org/uploads/media/BOLETIN_SONDEO_2011.pdf. 26 Zelaya had clandestinely returned to Honduras in September 2009, but was unable to leave the Brazilian Embassy where he had taken refuge. 27 “Congreso Aprueba Amnistía para Delitos Políticos Comunes Conexos,” El Tiempo (Honduras), January 27, 2010. Congressional Research Service 6 Honduran-U.S. Relations and to make recommendations to prevent similar events from occurring in the future.28 Reflecting the political polarization in Honduras, the Truth Commission was criticized throughout its operations by several sectors of Honduran society. Some conservatives feared it could be used as a means to promote the constitutional reforms that Zelaya proposed in the lead up to the country’s political crisis.29 At the other end of the ideological spectrum, the leftist National Popular Resistance Front (Frente Nacional de Resistencia Popular, FNRP)—an umbrella group of those who were opposed to Zelaya’s removal—viewed the Truth Commission as an attempt to “whitewash” the ouster. As a result, Zelaya called on officials from his government not to cooperate with the Truth Commission and the FNRP established an alternative commission.30 The Truth and Reconciliation Commission issued its final report in July 2011. Among other findings, the report asserts: (1) Zelaya refused to recognize or obey orders from the judicial branch and other governmental institutions; (2) the Honduran military partially acted on a judicial order in detaining Zelaya but the high command’s decision to force the president into exile violated due process and thus amounted to a coup d’état; (3) the Honduran National Congress had no power to remove President Zelaya or name a substitute and therefore the government of Roberto Micheletti was illegal; (4) there is no reliable evidence that President Zelaya intended to dissolve Congress, remain in office, or directly install a national constituent assembly after holding the non-binding referendum; (5) the November 2009 elections were legitimate; and (6) members of the Honduran military and police killed at least 12 citizens as a result of the disproportionate use of force to suppress political demonstrations during the Micheletti government. The report also provides a number of recommendations to avoid similar crises in the future. These include reforming the constitution to establish clear impeachment procedures, and investigating, processing, and punishing those responsible for the human rights abuses that took place in the aftermath of the ouster.31 Constitutional Reform Since his inauguration, Lobo has also engaged various sectors of Honduran society about potential political and constitutional reforms. As noted above, President Zelaya was advocating constitutional reform at the time of his ouster. Zelaya, the FNRP, and others assert that the current constitution—adopted in 1982 by a constituent assembly elected under a military government— reinforces the political and economic exclusion of the majority of the Honduran population. They maintain the only way to overcome this exclusion is to convene a democratic and inclusive constituent assembly to draft a new constitution.32 Lobo, who never ruled out the idea of abstract constitutional changes as a candidate, called for a national dialogue to discuss potential reforms in October 2010. In February 2011, the Honduran National Congress approved a measure that amended the constitutional provisions governing referendums and plebiscites to allow such 28 The creation of a truth commission had previously been agreed to by Zelaya and Micheletti as part of the Tegucigalpa-San José Accord, which they signed in late October 2009 in a failed attempt to end the political crisis. Although the accord fell apart almost immediately, Lobo has implemented several of its provisions since taking office. 29 Germán Reyes, “Lobo Pide No Temer a Comisión de Verdad y Avala Consulta para Constituyente,” Agencia EFE, May 4, 2010. 30 “Zelaya Calls on Former Officials Not to Collaborate with Truth Commission,” ACAN-EFE, June 8, 2010; “Honduran Resistance Sets Up Alternative Commission,” Latin News Weekly Report, July 1, 2010. 31 Comisión de la Verdad y la Reconciliación, 2011, op.cit. 32 “Rafael Alegría: Queremos Constituyente Democrática y Popular,” La Tribuna (Honduras), July 4, 2011. Congressional Research Service 7 Honduran-U.S. Relations citizen initiatives to address “issues of fundamental importance to national life,” potentially including changes to the currently unalterable portions of the constitution.33 Much like the Truth and Reconciliation Commission, Lobo’s efforts around the issue of constitutional reform have largely failed to reduce polarization. The FNRP and others assert that the changes made thus far are insufficient. They note that any reforms suggested through citizen initiatives would need to be approved by the National Congress, an institution they maintain represents entrenched interests that benefit from the status quo. Consequently, they have continued to push for a constituent assembly capable of drafting a new constitution.34 Likewise, conservative elements within the traditional parties and civil society have reacted to Lobo’s efforts with suspicion. While conceding that abstract changes may be necessary, they are opposed to the idea of convoking a constituent assembly or any attempt to change the unalterable portions of the constitution. They also have accused Lobo of seeking reelection and catering to small radical groups instead of addressing real issues of national importance.35 Return of Zelaya Although Lobo ensured Zelaya’s safe passage out of the country shortly after taking office, Zelaya was not able to freely return to Honduras until May 2011. Following Lobo’s inauguration, a number of countries joined with domestic groups like the FNRP in calling on President Lobo to create the conditions necessary to allow Zelaya to return to Honduras. Lobo encouraged Zelaya to return from exile but insisted that the former president would have to stand trial for the charges that were brought against him following his ouster, including fraud, falsification of public documents, and embezzlement of $2.95 million from the presidency and the Honduran Fund for Social Investment. Zelaya insisted that the charges were politically motivated and refused to return until they were dropped. On May 2, 2011, a Honduran court of appeals voted 2-1 to annul the criminal charges against Zelaya due to procedural irregularities.36 With criminal charges out of the way, former President Zelaya entered into a dialogue with President Lobo that was mediated by President Hugo Chávez of Venezuela and President Juan Manuel Santos of Colombia. On May 22, 2011, Lobo and Zelaya signed the “Accord for National Reconciliation and the Consolidation of the Democratic System in Honduras.” Among other provisions, the accord (1) guarantees the right of Zelaya and his exiled supporters to return to political life in Honduras; (2) reaffirms that the Honduran government has an obligation to protect human rights; (3) ensures that the FNRP can register as a political party; and (4) reiterates that the recent reforms to the Honduran constitution guarantee citizens’ rights to seek national plebiscites on issues of fundamental importance.37 33 “Honduras Congress Approves Referendums,” Latin News Daily, February 18, 2011. “Rafael Alegría: Queremos Constituyente Democrática y Popular,” La Tribuna (Honduras), July 4, 2011; Frente Amplio de Resistencia Popular, “Posicionamiento Frente Amplio de Resistencia Popular,” July 9, 2011. 35 “Anduray Postula Movimiento para Defender Constitución,” La Tribuna (Honduras), June 13, 2011; “‘Lobo y Hernández Gastan 2,000 Millones en Política’,” La Prensa (Honduras), July 11, 2011; Unión Cívica Democrática, “Posición de la Unión Cívica Democrática Relacionada con la Reforma del Articulo 5 de la Constitución de la República,” November 11, 2010. 36 “Zelaya Free to Roam,” Latin News Daily, May 3, 2011; “Honduras: Zelaya Ruling Removes Final Hurdle – Or Does It?” Latin News Weekly Report, May 5, 2011 37 “Acuerdo para la Reconciliación Nacional y la Consolidación del Sistema Democrático en la República de Honduras,” La Tribuna (Honduras), May 23, 2011. 34 Congressional Research Service 8 Honduran-U.S. Relations International Recognition Following the ouster of President Zelaya, Honduras was diplomatically isolated by the international community. Although trade continued with the exception of a 48-hour blockade by some Central American countries, the Micheletti government was not recognized by a single nation. On July 4, 2009, the member states of the OAS invoked Article 21 of the Inter-American Democratic Charter and unanimously voted to suspend Honduras from the organization for an unconstitutional interruption of the democratic order.38 Honduras also lost the support of the international financial institutions, which withheld access to loans and other transfers. As a result of the November 2009 election and Lobo’s reconciliation attempts upon taking office, much of the international community—including the United States, the European Union, most Central American nations, and the international financial institutions—quickly recognized the Lobo Administration. Many South American nations, however, expressed concerns that restoring formal relations with Honduras would set a dangerous precedent in the region since Zelaya was never returned to office. They excluded Honduras from regional gatherings and refused to lift the country’s suspension from the OAS. Moreover, they indicated that recognition would be dependent on conditions on the ground, including the ability of former President Zelaya to return home peacefully.39 On June 1, 2011, four days after Zelaya returned from exile, Honduras was finally able to rejoin the OAS. Noting the importance of the “Accord for National Reconciliation and the Consolidation of the Democratic System in Honduras” negotiated between Lobo and Zelaya, the OAS member states voted 32-1 to lift the suspension.40 Nearly all of the countries that had previously refused to do so also began to restore official ties with Honduras. Ecuador, which was the only country to vote against lifting the suspension, refuses to restore diplomatic relations “so long as those serving in the Honduran government participated in the coup outright and remain in complete impunity.”41 2013 Election Although over a year and a half remain in President Lobo’s term, attention in Honduras is increasingly turning to what could be an extremely volatile election in 2013. Polls conducted over the past year have consistently found high levels of dissatisfaction with democracy in Honduras. They have also found little or no confidence in almost every governmental and political institution in the country. Political parties are among the least trusted, with several polls finding nearly 60% of Hondurans have no confidence in them.42 As confidence in the parties has eroded, 38 Organization of American States, Resolution on the Suspension of the Right of Honduras to Participate in the OAS, OEA/Ser.P, AG/Res/2 (XXXVII-E/09), Washington, DC, July 4, 2009. 39 “Insulza Dice que Reintegro de Honduras a OEA está Atado a Exilio de Zelaya,” Agence France Presse, February 11, 2011. 40 Organization of American States, Participation of Honduras in the Organization of American States, OEA/Ser.P, AG/Res.1 (XLI-E/11), Washington, DC, June 1, 2011. 41 “Ecuador President Won’t Restore Ties with Honduras,” Agence France Presse, June 2, 2011. 42 See UCA & ERIC-SJ, January 2012, op.cit.; Centro de Estudios para la Democracia (CESPAD), Segunda Encuesta de Opinion Ciudadana: La Continuada Crisis del Bipartidismo y la Creciente Insatisfacción Ciudadana con la Democracia, September 2011, http://cespad.org/documentos/encuestas/Segunda%20encuesta%20de%20opinion%20cespad.pdf; and Neil Nevitte, Democracy in Honduras: Political Values and Civic Engagement in 2011, National Democratic Institute for (continued...) Congressional Research Service 9 Honduran-U.S. Relations so too has Hondurans’ family-based sense of party affiliation to the PL and PN.43 The majority of Hondurans are now open to voting for different political parties. Moreover, public approval of President Lobo and the PN-controlled National Congress is relatively low, and the PL remains divided over the 2009 ouster of President Zelaya.44 Given these dynamics, the 2013 election could present an opportunity for third party political forces or anti-system candidates beyond the country’s two dominant parties. Several new parties have registered with the TSE over the past year. Former President Zelaya and the FNRP launched the Liberty and Refoundation (Libertad y Refundación, LIBRE) party, under which they hope to unite supporters of the FNRP and disillusioned former supporters of the PL. Salvador Nasralla, a television personality and sports commentator, created the Anti-Corruption Party (Partido Anticorrupción, PAC) as a platform for a presidential run. And retired General Romeo Vásquez Velásquez, the commander of the Honduran armed forces when Zelaya was deposed, founded the Honduran Patriotic Alliance (Alianza Patriótica Hondureña, APH), a self-described civic-military group. These new parties will face a number of challenges, such as a lack of clientelist networks and political party machinery. The most difficult challenge to overcome, however, may be the cynicism of Hondurans toward politics. Voter abstention has increased in each election since 1997, and those abstaining constituted a majority in 2009.45 The new parties will need to convince the dissatisfied majority that electoral democracy is capable of producing real changes in Honduras. In December 2011, almost 65% of Hondurans surveyed described the new political parties as “more of the same.”46 Party primaries to select candidates for the 2013 election will be held in November 2012. Top PN presidential candidates include President of Congress Juan Orlando Hernández, who is backed by President Lobo, and Ricardo Alvarez, the mayor of Tegucigalpa. At least six candidates from various internal factions are seeking the PL’s presidential nomination. These include Yani Rosenthal, who served as Zelaya’s Minister of the Presidency; Edmundo Orellana, who served as Zelaya’s Defense Minister; Mauricio Villeda, who served as one of Micheletti’s negotiators during the 2009 political crisis; and Luis Alfonso Santos, a retired bishop who was one of the few members of the Catholic hierarchy to oppose the ouster. Although LIBRE will hold primary elections for most offices, its various internal factions have agreed to back Zelaya’s wife, Xiomara Castro, for president. Security and Human Rights Conditions Honduras has long struggled to address high levels of crime and violence, but the deterioration in security conditions has accelerated in recent years. Homicide rates have risen rapidly, from an already high 51 murders per 100,000 residents in 2000 to a world-topping 82 per 100,000 in 2010 (...continued) International Affairs (NDI) and Hagamos Democracia, July 2011, http://www.ndi.org/files/Democracy-in-Honduras2011.pdf. 43 Ruhl, April 2010, op.cit. 44 UCA & ERIC-SJ, January 2012, op.cit; CESPAD, September 2011, op.cit; Nevitte, July 2011, op.cit. 45 NDI, 2009 Honduran General Elections: International Election Assessment Mission Final Report, Washington, DC, January 27, 2010, p. 13, http://www.ndi.org/files/NDI_Honduras_Final_Report_International_Election_Assessment_Mission_%20English.pdf. 46 UCA & ERIC-SJ, January 2012, op.cit. Congressional Research Service 10 Honduran-U.S. Relations (see Figure 3 below).47 Preliminary statistics suggest that the homicide rate continued to climb in 2011, with murders increasing by 15%.48 Common crime is also widespread. In 2010, 16% of Hondurans reported they had been the victim of a crime in the past year.49 The World Bank estimates that crime and violence cost Honduras the equivalent of 10% of gross domestic product (GDP) annually.50 Figure 3. Honduran Homicide Rate, 2000-2010 (Homicides per 100,000 Residents) Source: CRS presentation of data from the United Nations Office on Drugs and Crime (UNODC), Global Study on Homicide, 2011. Many observers have been particularly concerned by a surge in violence against journalists and political and social activists. The frequency of such attacks increased in the aftermath of the June 2009 ouster of President Zelaya, and the attacks have continued under President Lobo. According to the National Commissioner for Human Rights, 20 journalists have been killed in Honduras since 2010.51 Many others have been threatened, harassed, or attacked, with those who report on or criticize the 2009 ouster, government corruption, and human rights abuses being the most frequent targets. Human rights organizations have also documented attacks against environmentalists, indigenous activists, human rights defenders, land rights activists, political organizers, unionists, and members of the lesbian, gay, bisexual, and transgender (LGBT) 47 United Nations, Office on Drugs and Crime (UNODC), Global Study on Homicide, 2011. http://www.unodc.org/documents/data-and-analysis/statistics/Homicide/Globa_study_on_homicide_2011_web.pdf. 48 Tatiana Paz, “Homicidios Aumentan un 15% en el 2011 en Honduras,” La Prensa (Honduras), December 30, 2011. 49 Mitchell A. Seligson and Amy Erica Smith, eds., Political Culture of Democracy, 2010: Democratic Consolidation in the Americas in Hard Times, Vanderbilt University, Latin American Public Opinion Project, December 2010, http://www.vanderbilt.edu/lapop/insights/RegionalEng.pdf. 50 “World Bank: Crime, Violence Cost Honduras 10 Percent of GDP Annually,” Associated Press, March 28, 2012. 51 CONADEH, “Violaciones a la Libertad de Expresión,” Press Release, March 19, 2012. Congressional Research Service 11 Honduran-U.S. Relations community.52 In the Bajo Aguan region of Honduras, for example, at least 50 people have been killed over the past two years as violence has escalated in a long-running land dispute between peasant farmers and large landowners.53 There are indications that members of the Honduran security forces may have been involved in some of these threats and attacks against journalists and activists; however, it is difficult to determine the extent of such involvement since most of the cases have never been investigated. Criminal Threats, Weak Institutions, and Corruption A number of inter-related factors have likely contributed to the worsening security and human rights situation. One aspect is the increasing presence of organized crime. An estimated 36,000 Honduran youth belong to street gangs such as Mara Salvatrucha (MS-13) and the 18th Street Gang (M-18).54 These organizations engage in a wide variety of criminal activities, including kidnapping and extortion.55 Honduras also serves as a drug-trafficking corridor as a result of its location between cocaine-producing countries of South America and the major consumer market in the United States. U.S.-backed security efforts over the past two decades have weakened Colombian cartels and restricted trafficking through the Caribbean, providing incentives for Mexican cartels to move into Central America. Consequently, more sophisticated transnational criminal organizations, such as the Sinaloa cartel and Los Zetas, have now established a presence in Honduras.56 Given that two-thirds of Hondurans live below the poverty line,57 a large portion of the population may be susceptible to recruitment by these and other criminal groups. Institutional weaknesses and corruption in the Honduran government have also contributed to deteriorating security and human rights conditions. In 2011, the Honduran National Police had 14,500 officers and a budget of $151 million (0.9% of GDP)58—a force strength and resources that analysts maintain are “grossly insufficient for the efficient policing of a country the size of Honduras.”59 The police force also suffers from widespread corruption, with analysts asserting that some officers have moved beyond taking bribes or tipping off criminals to actually participating in crimes and acting as enforcers for criminal interests.60 Some 67% of Hondurans 52 At least 75 such activists were reportedly murdered between June 2009 and March 2011. IACHR, Annual Report of the Inter-American Commission on Human Rights 2011, April 9, 2012, http://www.oas.org/en/iachr/docs/annual/2011/TOC.asp. 53 CONADEH, “Informe Muerte Violenta de Personas en el Bajo Aguan,” Press Release, 2012. 54 UNODC, Crime and Development in Central America: Caught in the Crossfire, May 2007, http://www.unodc.org/documents/data-and-analysis/Central-america-study-en.pdf. 55 For more information, see CRS Report RL34112, Gangs in Central America, by Clare Ribando Seelke. 56 Patrick Corcoran, “Mexican Cartels Expand into Honduras,” InSight Crime, April 14, 2011. 57 United Nations, Economic Commission for Latin America and the Caribbean (ECLAC), Social Panorama of Latin America, 2011, November 2011, p.13, http://www.eclac.cl/publicaciones/xml/5/45175/2011-819_PSI-SummaryWEB.pdf. 58 Red de Seguridad y Defensa de América Latina (RESDAL), Índice de Seguridad Pública y Ciudadana en América Latina : El Salvador, Guatemala y Honduras, 2011. 59 “Country Risk Assessment: Honduras,” IHS Jane's Defense and Security Intelligence and Analysis, February 8, 2012. 60 Edward Fox, “Dynamics of Honduran Police Corruption Narrow Chance for Reform,” InSight Crime, January 31, 2012; Diego Jiménez, “‘El Incendio en Comayagua Evidencia el Colapso del Sistema,’” La Nación (Costa Rica), February 26, 2012. Congressional Research Service 12 Honduran-U.S. Relations believe that the police force is involved in crime.61 Moreover, recent press investigations suggest that corruption may run to the very top of the organization.62 Partially as a result of the serious flaws in the police force, Honduran presidents have repeatedly turned to the armed forces to provide internal security. The Honduran military, however, has its own limitations. In 2010, Honduras had roughly 8,600 military personnel, and a defense budget of $172 million (1.1% of GDP). The Honduran military is almost entirely dependent on international donors for functioning equipment and technology since less than 1% of the defense budget is invested in maintenance and procurement.63 Corruption is also a problem. The military has been linked to drug trafficking in Honduras since the 1980s,64 and recent reports suggest some sectors continue to engage in illicit activities.65 Although the military is more respected than the police force, it enjoys the confidence of less than 36% of Hondurans.66 Other justice sector institutions are prone to similar problems. According to the National Commissioner for Human Rights, 80% of crimes that are reported are never even investigated.67 This reportedly stems from the failure of public prosecutors, who are charged with coordinating investigations, to work effectively with the police to carry them out.68 Although most criminals are never brought to justice, the Honduran prison system is still overcrowded. While Honduras’ hard-line anti-gang laws make it relatively easy to detain suspected gang members, the judiciary is incapable of dealing with the volume of cases.69 Consequently, Honduran prisons, which have capacity for 8,000 inmates, currently hold 13,000 prisoners—60% of whom have not been convicted.70 This lack of capacity and susceptibility to corruption goes well beyond the security forces and justice sector. The patronage system, which allows the political parties to place their supporters in government positions after each election, has prevented the development of a professional civil service. As a result, Honduran officials often lack technical expertise and rarely engage in longterm strategic planning.71 Likewise, Honduras ranks near the bottom of the Western Hemisphere in Transparency International’s annual Corruption Perceptions Index, suggesting public-sector corruption is relatively widespread.72 This apparently includes infiltration by organized crime. 61 UCA & ERIC-SJ, January 2012, op.cit. Frances Robles, “Graft, Greed, Mayhem Turn Honduras into Murder Capital of World,” Miami Herald, January 22, 2012; and Daniel Valencia Caravantes, “Así es la Policía del País Más Violento del Mundo,” El Faro (El Salvador), March 19, 2012. 63 RESDAL, Comparative Atlas of Defence in Latin America and Caribbean, 2010. 64 Mark B. Rosenberg, “Narcos and Politicos: Politics of Drug Trafficking in Honduras,” Journal of Interamerican Studies and World Affairs, Vol. 30, No. 2/3, (Summer-Autumn 1988). 65 Geoffrey Ramsey, “Cable: Honduran Military Supplied Weaponry to Cartels,” InSight Crime, April 25, 2011. 66 In comparison, 23.3% of Hondurans express confidence in the police force. UCA & ERIC-SJ, January 2012, op.cit. 67 CONADEH, “Impunidad,” Press Release, April 2012. 68 “Policías y Fiscales son un ‘Desastre’ en la Investigación Criminal,” El Heraldo (Honduras), April 11, 2012; “La Investigación es Problema de País, Admite Directora de Fiscalías en Honduras,” El Heraldo, (Honduras), April 15, 2012. 69 Hannah Stone, “Honduras Prison Fire Tells of Repressive Anti-Gang Policies,” InSight Crime, February 16, 2012. 70 “Honduras Crea Instituto para Atender Severa Crisis de las Cárceles,” Agence France Presse, April 11, 2012. 71 Romero, 2010, op.cit. 72 On a scale of 0 (highly corrupt) to 10 (very clean), Honduras receives a score of 2.6. Transparency International, Corruption Perceptions Index 2011, 2011, http://cpi.transparency.org/cpi2011/. 62 Congressional Research Service 13 Honduran-U.S. Relations According to Alfredo Landaverde—a well-respected anti-corruption advocate and former head of the Anti-Narcotics Commission who was assassinated in December 201173—10% of the members of the Honduran National Congress are involved in drug-trafficking.74 Public Security Policies Recent Honduran presidents have implemented varying anti-crime strategies, but none of them have achieved much success. During his term, President Ricardo Maduro (2002-2006) increased the size of the police force, sent the military into the streets, and implemented hard-line anti-gang policies that made membership illegal and punishable with 12 years in prison. Although the crackdown won popular support and initially reduced crime, its success was short-lived. President Zelaya (2006-2009) replaced the previous administration's zero-tolerance policy with dialogue and other efforts to reintegrate gang members into society. Failure to achieve concrete results, however, led the Zelaya Administration to shift its emphasis toward more traditional law enforcement operations. The deterioration in security conditions accelerated in the aftermath of Zelaya’s ouster, as Roberto Micheletti (2009-2010) reoriented the security forces away from combating organized crime to controlling the population.75 Some analysts assert that the ouster also exacerbated the situation by reinforcing the general sense of impunity in Honduras.76 Since taking office, President Lobo has undertaken a number of initiatives in an attempt to improve security conditions in Honduras. Working with the National Congress, he has enacted significant changes in the country’s legal framework. These include a law against terrorism finance; a reform to allow 48-hour detentions; regulations to allow asset forfeiture and wiretapping; and a constitutional amendment to allow the extradition of Honduran citizens in cases of drug trafficking, organized crime, and terrorism. Lobo and the National Congress also increased taxes on the mining, telephone, and other industries to increase funding for security efforts. The tax package was partially rolled back, however, as a result of fierce private sector opposition.77 Many of these legal changes are still in the process of implementation. In reaction to a series of scandals in which the police were implicated in murders and other criminal activities, Honduran officials established two commissions to reform the police force and other justice sector institutions. In December 2011, the National Congress created the Directorate for the Investigation and Evaluation of the Police Career. It will replace the former Internal Affairs Unit of the police, which was reported to be rather ineffective.78 In January 2012, the National Congress established a Public Security Reform Commission. It is empowered to investigate the police, the public prosecutor’s office, and the judiciary, and suggest reforms to strengthen the institutions and reduce corruption.79 Both commissions have been slow to begin 73 Just days before he was assassinated, Landaverde appeared on a television program and stated that he had a list of Honduran officials tied to organized crime and drug-trafficking. 74 Tim Johnson, “Drug Gangs Muscle into New Territory: Central America,” McClatchy Newspapers, April 21, 2011. 75 James Bosworth, Honduras: Organized Crime Gaining Amid Political Crisis, Woodrow Wilson International Center for Scholars, Working Paper Series on Organized Crime in Central America, December 2010, http://www.wilsoncenter.org/sites/default/files/Bosworth.FIN.pdf. 76 See, for example, Annie Murphy, “‘Who Rules in Honduras?’ Coup’s Legacy of Violence,” National Public Radio, February 12, 2012. 77 “Honduras Cuts Security Tax After Angering Businesses,” Reuters, September 14, 2011. 78 “Cisma en la Policía Nacional: 60 Días de Escándalos,” El Tiempo (Honduras), December 22, 2011. 79 “Honduras: Lobo Makes Move to Purge Police,” Latin American Weekly Report, February 2, 2012. Congressional Research Service 14 Honduran-U.S. Relations operations, however, leading some observers to question the Honduran government’s commitment to security sector reform.80 Following in the footsteps of his predecessors, Lobo has also ordered the armed forces into the streets to carry out some internal security operations. He has deployed the military to carry out joint operations with the police on several occasions, and in late November 2011, the Honduran National Congress approved a decree to temporarily allow military personnel to carry out raids, make arrests, disarm people, and act against police officers that are involved in criminal activities. In March 2012, the emergency decree providing the military with broad policing powers was extended for another 90 days. President Lobo also proposed amending the constitution to make the military’s policing powers permanent. Lobo has previously suggested merging the security and defense ministries to establish a single civilian ministry to coordinate both the police and military.81 A number of analysts have raised concerns about this increasing reliance on the military for domestic security. Some assert that the military has begun to carve out a larger role for itself in internal affairs since playing a leading role in the 2009 ouster of President Zelaya, and argue that this is a worrying trend since the military repeatedly took control of the country prior to 1982 and was only subordinated to civilian control in the late 1990s.82 U.S. military officials argue that utilizing the Honduran military for domestic security matters “is a necessary initial step to help curb the rising tide of violence,” but maintain that such an approach “is unsustainable in the long term.”83 Although some of these security policies—such as police reform—could improve human rights conditions in Honduras, the Honduran government has offered few initiatives specifically designed to do so. President Lobo has created a new Ministry of Justice and Human Rights, and provided the Human Rights Unit in the Attorney General’s Office with an independent budget for the first time. Lobo has also acknowledged that the Honduran government lacks investigatory capacity, and has requested international assistance to resolve human rights cases.84 Human rights organizations maintain that these efforts have been insufficient. They criticize the Lobo Administration for repeatedly dismissing the possibility that attacks against journalists and activists might be related to the victims’ professions or activism, and for failing to hold accountable those responsible for such attacks.85 80 “Proceso de Depuración Policial en Honduras está Estancado,” La Prensa (Honduras), April 11, 2012; “‘Gobeirno Siembra la Incertidumbre,’” La Prensa (Honduras), April 5, 2012. 81 “Honduras: Lobo Leans Towards a Permanent Military-Security Role,” Latin American Regional Report: Caribbean & Central America, April 2012; “Lobo Forced to Clarify Security Reforms,” Latin News Daily, October 11, 2011. 82 See, for example, Thelma Mejía, “Honduras: Putting Defense in the Hands of Civilians,” Inter Press Service, October 4, 2011; and Geoffrey Ramsey, “New Powers for Honduran Military Will Not Clean Up Law Enforcement,” InSight Crime, November 30, 2011. 83 General Douglas M. Fraser, United States Air Force Commander, Posture Statement Before the 112th Congress, House Armed Services Committee, United States Southern Command, March 6, 2012, p. 24, http://armedservices.senate.gov/statemnt/2012/03%20March/Fraser%2003-13-12.pdf. 84 “Honduras Pide Ayuda a Colombia, España, y EEUU en Investigación Sobre DDHH,” Agence France Presse, January 27, 2011. 85 Human Rights Watch, World Report, 2012, http://www.hrw.org/world-report-2012/world-report-chapter-honduras; Committee to Protect Journalists, Attacks on the Press in 2011, 2012, http://www.cpj.org/attacks_on_the_press_2011.pdf. Congressional Research Service 15 Honduran-U.S. Relations Economic and Social Conditions With a gross national income (GNI) of $14.2 billion (2010) and a per capita income of $1,870, Honduras is classified by the World Bank as a lower-middle-income developing country.86 The Honduran economy has historically been dependent on agricultural exports such as coffee and bananas. While these commodities remain important, the Honduran economy has grown more diversified as a result of significant growth in nontraditional sectors such as shrimp farming and the maquiladora, or export-processing industry. In 1998, Honduras was devastated by Hurricane Mitch, which killed more than 5,000 people and caused billions of dollars in damage. The economy contracted by 1.4% in 1999, but rebounded with average annual growth of 5% between 2000 and 2008.87 During the same time period, international financial institutions provided Honduras with $2.4 billion in debt relief to free government resources for poverty alleviation efforts. 88 Honduras in Brief Approximate Size: Slightly larger than Virginia Population (2011 est.): 8.14 million Ethnic Groups: 90% Mestizo (mixed Amerindian and European), 7% Amerindian, 2% black, 1% white Religions: 65% Roman Catholic, 35% Protestant Official Language: Spanish GNI (Atlas Method, 2010): $14.2 billion GNI per Capita (Atlas Method, 2010): $1,870 Poverty Rate (2010): 67.4% Indigence Rate (2010): 42.8% Adult Literacy Rate (2007): 84% Life Expectancy (2009): 73 years Infant Mortality (2010): 20 per 1,000 live births Sources: U.S. State Department, World Bank, U.N. Economic Commission for Latin America and the Caribbean. Crises and Recovery The global financial crisis and domestic political crisis took a significant toll on Honduras. As an open economy that is closely tied to the United States, Honduras is sensitive to international downturns. By early 2009, Honduras was experiencing significant declines in remittances, tourism, and export earnings as a result of the global financial crisis and U.S. recession.89 The ouster of President Zelaya exacerbated these economic problems, as the international community, which had been expected to finance 20% of the government’s budget,90 imposed a series of economic sanctions on Honduras. International financial institutions withheld access to loans and other transfers, the European Union and United States terminated some foreign aid, and Venezuela stopped supplying the country with subsidized oil. Domestic opponents of the ouster placed additional pressure on the economy, engaging in strikes, transportation blockades, and other measures designed to paralyze economic activity. Curfews implemented by the Micheletti government to suppress demonstrations by the political opposition further inhibited economic 86 World Bank, “Data: Honduras,” http://data.worldbank.org/country/honduras. “Honduras: Country Data,” Economist Intelligence Unit, February 2011. 88 International Monetary Fund (IMF), “IMF and World Bank Support US$1 Billion in Debt Service Relief for Honduras,” Press Release No. 05/76, April 5, 2005; Inter-American Development Bank (IDB), “IDB Governors Approve $4.4 Billion in Debt Relief for Bolivia, Guyana, Haiti, Honduras and Nicaragua,” Press Release, March 16, 2007. 89 “Honduras: Country Report” Economist Intelligence Unit, April 2009. 90 Robin Emmott, “Aid Freeze in Post-Coup Honduras Hurting Poor,” Reuters, November 12, 2009. 87 Congressional Research Service 16 Honduran-U.S. Relations activity as workers were unable to reach their places of employment. These external and internal shocks contributed to an economic contraction of 2.1% in 2009.91 Upon taking office in January 2010, President Lobo inherited a weak economy and a growing budget deficit. He entered into negotiations with the international financial institutions, and quickly secured an emergency stand-by agreement with the International Monetary Fund (IMF) as well as much needed development financing from the World Bank and Inter-American Development Bank. Under the agreements, Lobo committed to undertaking structural reforms designed to restore macroeconomic stability and strengthen public finances. The Honduran National Congress has approved several of the structural changes, including a tax reform designed to increase revenue, an energy reform to more narrowly target subsidies, a reform of public sector pension funds designed to make them more sustainable, and a measure de-indexing teachers’ wages from changes in the minimum wage in an effort to slow the growth of expenditure on public sector salaries.92 These changes, along with improving economic conditions in the United States, have helped narrow the Honduran central government’s deficit from 6.2% of GDP in 2009 to an estimated 3.5% of GDP in 2012. Despite these tight fiscal policies, the economy grew by 3.8% in 2011 and is expected to grow by 4% in 2012. The recovery remains fragile, however, and the government’s budget constraints leave little room for counter-cyclical spending should the international economic situation worsen.93 Social Indicators Honduras remains one of the poorest and most unequal countries in Latin America. Nevertheless, international debt relief and higher levels of economic growth over the past decade have allowed the Honduran government to dedicate more resources to poverty alleviation efforts. Between 2002 and 2009, public social spending increased from 9.5% of GDP to 11.4% of GDP.94 During the same time period, poverty fell from 77.3% to 65.7% and indigence fell from 54.4% to 41.8%. Both poverty and indigence increased in the aftermath of the global financial crisis and domestic political crisis, however, reaching 67.4% and 42.8%, respectively, in 2010.95 The reduction in the poverty rate has not been accompanied by a reduction in income disparities. The top 10% of Hondurans received 43% of all income in 2010, which is more than the bottom 80% combined and a level virtually unchanged from 1999.96 Likewise, there continue to be significant barriers to social mobility. According to a 2010 World Bank report, just 51% of the basic housing and education services necessary to succeed in life are available and distributed equitably among Honduran children.97 91 “Honduras: Country Report,” Economist Intelligence Unit, March 2012. “Honduras: Country Report,” Economist Intelligence Unit, December 2010; IMF, Honduras: Letter of Intent, Memorandum of Economic and Financial Policies, and Technical Memorandum of Understanding, September 10, 2010; IMF, “Statement by an IMF Mission at the Conclusion of its Visit to Honduras,” Press Release No.12/43, February 9, 2012. 93 “Honduras: Country Report,” Economist Intelligence Unit, March 2012. 94 ECLAC, Social Panorama of Latin America, 2010, November 2010, p.156, http://www.eclac.cl/publicaciones/xml/1/41801/PSI2010-Chapter-III-Social-Spending.pdf. 95 ECLAC, November 2011, op.cit. 96 ECLAC, Statistical Yearbook for Latin America and the Caribbean, 2011, December 2011, p. 68, http://www.eclac.cl/publicaciones/xml/8/45608/LCG2513b.pdf. 97 José R. Molinas et al., Do Our Children Have a Chance? The 2010 Human Opportunity Report for Latin America and the Caribbean, World Bank, Conference Edition, Washington, DC, 2010, p. 52, (continued...) 92 Congressional Research Service 17 Honduran-U.S. Relations The Lobo Administration is currently implementing policy reforms designed to strengthen the Honduran social protection system. When Lobo took office, Honduras had a number of social assistance programs that offered varying levels of coverage and were not well coordinated. Lobo has begun consolidating several of these programs under his Bono 10,000 initiative, which provides an annual stipend of 10,000 Lempiras (about $525) to families in extreme poverty. In exchange, the families agree to keep their children in school and attend regular preventative health check-ups. The program currently reaches at least 229,000 households, and is expected to incorporate 600,000 families by the end of 2014. The World Bank expects Bono 10,000 to have a significant impact on household income, but is concerned that Honduras may not be able to sustain the program once it reaches its full projected coverage.98 Issues in U.S.-Honduran Relations The United States has had close relations with Honduras over many years. The bilateral relationship became especially close in the 1980s when Honduras returned to democratic rule and became the lynchpin for U.S. policy in Central America. At that time, the country was a staging area for U.S.-supported excursions into Nicaragua by the Contra forces attempting to overthrow the leftist Sandinista government. Economic linkages also intensified in the 1980s after Honduras became a beneficiary of the Caribbean Basin Initiative, which provided duty-free importation of Honduran goods into the United States. Bilateral economic ties have further expanded since the entrance into force of the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR) in 2006. Relations between the United States and Honduras were strained in 2009 because of the country’s political crisis. The Obama Administration quickly condemned the June 28 ouster, and, over the course of the following months, leveled a series of diplomatic and economic sanctions designed to pressure Honduran officials to restore Zelaya to power. The Administration limited contact with the Honduran government, suspended some foreign assistance, minimized cooperation with the Honduran military, and revoked the visas of members and supporters of the Micheletti government. Micheletti reacted angrily to U.S. policy toward Honduras, declaring, “it isn’t possible for anyone, no matter how powerful they are, to come over here and tell us what we have to do.”99 In November 2009, the Administration shifted the emphasis of U.S. policy from reversing Zelaya’s removal to ensuring the legitimacy of previously scheduled elections. Although some analysts argued that the policy shift allowed those behind the ouster to consolidate their hold on power, Administration officials maintained that elections had become the only realistic way to bring an end to the political crisis.100 Relations have improved considerably since the inauguration of President Lobo, whose efforts to foster national reconciliation and solidify democratic processes in Honduras led the United States (...continued) http://siteresources.worldbank.org/INTLACREGTOPPOVANA/Resources/840442-1260809819258/66455531273515611898/Livro2010_final1.pdf. 98 World Bank, Project Information Document, Appraisal Stage: HN-Social Protection, Report No.AB5677, May 17, 2010; World Bank, Information Status & Results: Honduras Social Protection, Report No.ISR5625, July 12, 2011. 99 Carlos Salinas, “Honduran De Facto Leader Vows to Cling to Power Over US Objections,” El País (Spain), August 5, 2009. 100 Ginger Thompson, “U.S. Tries to Salvage Honduras Accord,” New York Times, November 10, 2009. Congressional Research Service 18 Honduran-U.S. Relations to restore foreign assistance and resume cooperation on other issues. Current U.S. policy objectives in Honduras include (1) improving the human-rights climate, especially regarding allegations that journalists and other individuals have been targeted for their political views; (2) combating high levels of corruption, crime, and drug-trafficking; and (3) promoting and implementing social and economic reforms to boost growth and reduce poverty and inequality levels that are among the highest in the hemisphere.101 To advance these policy objectives, the United States provides Honduras with foreign assistance, maintains significant security and commercial ties, and engages on transnational issues such as migration and human trafficking. Foreign Assistance The United States has provided considerable amounts of foreign assistance to Honduras over the past three decades. In the 1980s, the United States provided about $2.5 billion (constant 2010 dollars) in economic and military aid to Honduras as the country supported U.S. policy objectives in the region. In the 1990s, U.S. assistance to Honduras began to wane as regional conflicts subsided and competing foreign assistance needs grew in other parts of the world. Hurricane Mitch changed that trend as the United States provided significant amounts of aid to help the country recover from the 1998 storm. As a result of the influx of aid, total U.S. assistance to Honduras for the 1990s amounted to around $1.2 billion (constant 2010 dollars). With Hurricane Mitch funds expended by the end of 2001, U.S. foreign aid levels to Honduras again began to decline. From 2000 to 2009, total U.S. assistance to Honduras amounted to just over $900 million (constant 2010 dollars).102 Bilateral Assistance U.S. bilateral assistance to Honduras supports a variety of projects designed to strengthen democracy and the rule of law, enhance citizen security, improve health systems, increase food security, and conserve the environment. Recent bilateral U.S. assistance to Honduras amounted to $50.3 million in FY2010, $56 million in FY2011, and is scheduled to total an estimated $57 million in FY2012. Honduras would receive $58.2 million under the Obama Administration’s request for FY2013. This includes $49 million in Development Assistance, $5.5 million for Global Health Programs, $3 million in Foreign Military Financing, and $650,000 for International Military Education and Training (see Table 1 below). Most assistance to the country is managed by the U.S. Agency for International Development (USAID) and the U.S. Department of State. 101 Testimony of Craig Kelly, Principal Deputy Assistant Secretary of State for Western Hemisphere Affairs, U.S. Department of State, before the House Subcommittee on the Western Hemisphere, March 18, 2010. 102 These figures represent actual obligations, not appropriations. U.S. Agency for International Development (USAID), U.S. Overseas Loans and Grants: Obligations and Loan Authorizations, July 1, 1945-September 30, 2010, 2012. Congressional Research Service 19 Honduran-U.S. Relations Table 1. Bilateral U.S. Assistance to Honduras, FY2008-FY2013 (U.S. $ in thousands) Account FY2012 (Estimate) FY2013 (Request) FY2008 FY2009 FY2010 FY2011 DA 15,149 21,382 37,491 42,266 46,266 49,000 GHP (USAID) 12,035 11,750 11,000 10,988 8,000 4,500 1,000 1,000 1,000 1,000 1,000 1,000 10,150 5,771 0 0 0 0 INCLE 744 0 0 0 0 0 IMET 936 329 777 765 700 650 FMF 496 0 0 998 1,000 3,000 40,510 40,232 50,268 56,017 56,966 58,150 GHP (State) P.L. 480 Total Sources: U.S. Department of State, Congressional Budget Justification for Foreign Operations, Fiscal Years 2010, 2011, 2012, and 2013, http://www.state.gov/f/releases/iab/index.htm. Notes: DA=Development Assistance; GHP=Global Health Programs; P.L. 480=Food For Peace; INCLE=International Narcotics Control and Law Enforcement; IMET=International Military Education and Training; and FMF=Foreign Military Financing. Additional U.S. Assistance Honduras receives some U.S. aid beyond the bilateral assistance noted above. Additional sources of U.S. assistance in recent years include the Central America Regional Security Initiative, the Department of Defense, the Millennium Challenge Corporation, and the Peace Corps. Central America Regional Security Initiative103 Honduras receives some assistance provided to Central America through the Central America Regional Security Initiative (CARSI, formerly known as Mérida-Central America), which is funded through the State Department’s Western Hemisphere Regional account. In addition to providing the seven nations of Central America with equipment, training, and technical assistance to support immediate law enforcement and interdiction operations, CARSI is designed to strengthen the capacities of governmental institutions to address security challenges and the underlying conditions that contribute to them. Congress has appropriated $466.5 million for CARSI since FY2008, and the Obama Administration has requested an additional $107.5 million for CARSI in FY2013. It is unclear what percentage of that funding goes to Honduras since the State Department has not provided a public breakdown of CARSI funding by country. CARSI supports a wide variety of activities in Honduras. Some U.S. agencies are using CARSI funds to establish and support specially-vetted units and task forces. Drug Enforcement Administration (DEA) and Immigration and Customs Enforcement (ICE) vetted units and a U.S.Honduran joint Financial Crimes Task Force receive equipment and training in support of complex investigations into drug trafficking, money laundering, and arms and bulk cash 103 For more information, see CRS Report R41731, Central America Regional Security Initiative: Background and Policy Issues for Congress, by Peter J. Meyer and Clare Ribando Seelke. Congressional Research Service 20 Honduran-U.S. Relations smuggling. The Federal Bureau of Investigation (FBI) leads a Transnational Anti-Gang unit designed to interrupt criminal gang activity. A Special Victims Task Force—consisting of vetted members of the Honduran National Police, the Public Ministry, and U.S. advisors—is looking into high profile violent crime cases, such as the persecution of journalists and members of the LGBT community. Other CARSI-funded efforts to strengthen Honduran institutions include support for a joint Criminal Investigative School, and border and prison management reforms. CARSI funds are also being utilized to support civil society and municipal government prevention programs. At least 25 community outreach centers have been established to provide vocational training, employment resources, and other opportunities for at-risk youth.104 Department of Defense The U.S. Department of Defense provides Honduras with additional security assistance. Congress has authorized the Department of Defense to provide certain types of support for foreign counterdrug efforts, including training, equipment, infrastructure, transportation, reconnaissance, and intelligence analysis.105 In recent years, this has included the construction of Honduran naval bases in Caratasca and on the island of Guanaja, both of which are designed to enhance Honduras’ capabilities to detect and interdict illicit drug shipments in high volume maritime trafficking corridors.106 Estimated direct and indirect Department of Defense counternarcotics support totaled $8.5 million in FY2011, and is expected to total $4.9 million in FY2012, and $4.4 million in FY2013.107 Millennium Challenge Corporation The Millennium Challenge Corporation (MCC) provided Honduras with a five-year, $205 million108 economic growth compact, which was completed in September 2010. The compact had two components: a rural development project to provide farmers with skills to grow and market new crops, and a transportation project to improve roads and highways to link farmers and other businesses to ports and major production centers in Honduras.109 In January 2011, MCC announced that it would not be renewing the compact. Although Honduras passes 16 of 20 indicators on the MCC scorecard, it performs below the median on corruption. Nevertheless, MCC has declared Honduras eligible for a Threshold Program of up to $20 million in FY2012. The Threshold Program will address policy barriers to a second MCC compact and economic growth.110 104 U.S. Embassy in Honduras, “Current CARSI Projects in Honduras,” March 6, 2012. For more information on Department of Defense counterdrug authorities, see CRS Report RL34543, International Drug Control Policy, by Liana Sun Wyler. 106 “Central America: Behind the Growing Presence of the US,” Latin American Security & Strategic Review, July 2010; U.S. Department of Defense, Fiscal Year 2010 DoD Foreign Counterdrug Activity Report, April 4, 2011. 107 These are estimates as the Department of Defense budgets its counternarcotics assistance by program rather than by country. U.S. Department of Defense, Counternarcotics (CN) Support for Foreign Countries, February 17, 2012. 108 The compact was originally for $215 million, but the final $10 million was terminated as a result of the 2009 ouster of President Zelaya. 109 Millennium Challenge Corporation (MCC), “Honduras Compact: Raising Incomes, Realizing Dreams” November 3, 2010. 110 MCC, “Report on Selection of Eligible Countries for Fiscal Year 2012,” December 2011. 105 Congressional Research Service 21 Honduran-U.S. Relations Peace Corps The Peace Corps, which had been active in Honduras since 1963, pulled all 158 of its volunteers out of Honduras in January 2012 as a result of security concerns.111 The volunteers worked on projects related to HIV/AIDS prevention and child survival; protected area management; water and sanitation; and business, municipal, and youth development. The Peace Corps conducted a thorough assessment of the program and security conditions in Honduras in February 2012, and is currently considering whether or not to return to the country. More than 5,500 Americans have served in Honduras since the program was founded.112 Human Rights Conditions on Aid Since the 2009 ouster of President Zelaya, Members of Congress have expressed serious concerns about the human rights situation in Honduras. A provision in the Consolidated Appropriations Act of 2012 (P.L. 112-74) requires the State Department to withhold some assistance for the Honduran security forces until certain human rights conditions are met. According to the legislation, 20% of the funds appropriated for the Honduran military and police forces must be withheld until the Secretary of State reports that: “the Government of Honduras is implementing policies to protect freedom of expression and association, and due process of law; and is investigating and prosecuting in the civilian justice system, in accordance with Honduran and international law, military and police personnel who are credibly alleged to have violated human rights, and the Honduran military and police are cooperating with civilian judicial authorities in such cases.” The restriction does not apply to assistance designed to promote transparency, anticorruption, and the rule of law within the military and police forces. Nor does it apply to any of the security support being provided by the U.S. Department of Defense. In March 2012, a number of Members of Congress signed onto letters to Secretary of State Clinton reiterating their concerns about human rights conditions in Honduras. A letter signed by seven Senators highlighted a broad range of human rights concerns and requested detailed information on the Honduran government’s compliance with the human rights provisions in the FY2012 appropriations legislation.113 Another letter, which was signed by 94 Representatives, primarily focused on the situation in Bajo Aguán. Among other actions, the letter called for the suspension of U.S. assistance to Honduran security forces.114 Security Cooperation U.S.-Honduran security cooperation goes well beyond the provision of foreign assistance. Among other initiatives, the two countries work together on counternarcotics efforts, maintain close military ties, and cooperate on port security issues. 111 “158 Peace Corps Volunteers Leave Honduras,” Associated Press, January 16, 2012. Peace Corps, “Frequently Asked Questions: Peace Corps Operations in Honduras, El Salvador, and Guatemala,” March 2012. 113 Letter from Barbara A. Mikulski, United States Senator, et al. to the Honorable Hillary Clinton, Secretary of State, March 5, 2012. 114 Letter from Jan Schakowsky, United States Representative, et al. to the Honorable Hillary Clinton, Secretary of State, March 9, 2012. 112 Congressional Research Service 22 Honduran-U.S. Relations Counternarcotics Cooperation Honduras is a major transshipment point for illicit narcotics. Approximately 20% of the cocaine trafficked to the United States is transported through the air,115 and 79% of cocaine smuggling flights departing South America land in Honduras.116 Remote areas, such as the Mosquitia region along Honduras’ northeastern coast, have been particularly vulnerable to such flights given the lack of state presence. After the drug planes land in Honduras, the cocaine continues on toward the United States on subsequent flights or through maritime corridors and overland routes. Although counternarcotics cooperation was temporarily disrupted by the 2009 political crisis, communication and coordination between U.S. law enforcement and intelligence entities and Honduran military and police elements have improved since President Lobo took office. A highlevel task force, co-chaired by President Lobo and the U.S. Ambassador, convenes quarterly to oversee and direct coordination on security sector efforts. As noted above, the United States provides Honduras with extensive assistance to combat drug-trafficking and related security problems through CARSI and other aid programs (see “Foreign Assistance”). Additional counternarcotics support reportedly has been provided through the DEA’s Foreign-deployed Advisory Support Team (FAST) program, which deploys detachments of military-trained special agents to train, mentor, and work with specially vetted members of local security forces.117 U.S.-Honduran counternarcotics efforts have produced considerable results. In 2011, the Honduran government (with U.S. support) interdicted over 22 metric tons of cocaine, which is four times the amount of cocaine it interdicted in 2010. The Honduran government also seized 8 kilograms of heroin, 299,000 pseudoephedrine tablets, and the first cocaine processing laboratory to be discovered in Central America in recent years.118 Despite these accomplishments, concerns about criminal infiltration of the Honduran government and security forces could impede future cooperation.119 The State Department asserts that corrections management and police reform will be needed to sustain near-term successes.120 Military Ties The United States maintains a troop presence of about 600 military personnel known as Joint Task Force (JTF) Bravo at Soto Cano Air Base in Honduras. JTF Bravo was first established in 1983 with about 1,200 troops who were involved in military training exercises and in supporting U.S. counterinsurgency and intelligence operations in the region. In the aftermath of Hurricane Mitch in 1998, U.S. troops provided extensive assistance in the relief and reconstruction effort. Today, U.S. troops in Honduras support such activities as disaster relief, medical and humanitarian assistance, counternarcotics operations, and search and rescue operations that benefit Honduras and other Central American countries. Regional exercises and deployments 115 Information provided to CRS by Joint Interagency Task Force South, 2012. U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International Narcotics Control Strategy Report (INCSR), March 7, 2012, http://www.state.gov/j/inl/rls/nrcrpt/2012/vol1/184100.htm#Honduras. 117 Charlie Savage, Randal C. Archibold, and Ginger Thompson, “D.E.A. Squads Extend Reach of Drug War,” New York Times, November 7, 2011. 118 INCSR, 2012, op.cit. 119 See, for example, Ramsey, April 2011, op.cit.; Johnson, April 2011, op.cit.; and Robles, January 2012, op.cit. 120 INCSR, 2012, op.cit. 116 Congressional Research Service 23 Honduran-U.S. Relations involving active duty and reserve components also provide training opportunities for thousands of U.S. troops. The Honduran military’s role in the June 2009 ouster of President Manuel Zelaya led some to reassess the state of U.S.-Honduran military cooperation. Some analysts questioned the effectiveness of such cooperation, arguing that military-to-military contact does not appear to have obtained its desired outcomes given that the Honduran military reportedly cut off contact with the United States prior to the ouster.121 The events led the United States to temporarily suspend joint military activities as well as some military assistance to the country.122 U.S.Honduran military cooperation resumed following the election of President Lobo, however, with the United States restoring aid and training efforts.123 Port Security Honduras and the United States have also cooperated on port security. For the United States, port security emerged as an important element of homeland security in the aftermath of the September 11, 2001, terrorist attacks. Honduras views such cooperation as important in order to ensure the speedy export of its products to the United States, which in turn could increase U.S. investment in the country. In March 2006, U.S. officials announced the inclusion of the largest port in Honduras, Puerto Cortés, in the U.S. Container Security Initiative (CSI). CSI is operated by U.S. Customs and Border Protection (CBP), and uses a security regime to ensure that all containers that pose a potential risk for terrorism are identified and inspected at foreign ports before they are placed on vessels destined for the United States. Honduras also participates in the Department of Energy's Megaports Initiative, which supplies ports with equipment capable of detecting nuclear or radioactive materials, and the Secure Freight Initiative (SFI), which deploys equipment capable of scanning containers for radiation and information risk factors before they are allowed to depart for the United States. Puerto Cortés was one of six ports around the world chosen to be part of the first phase of the SFI. Trade and Investment U.S. trade and investment linkages with Honduras have increased significantly since the early 1980s. In 1984, Honduras became one of the first beneficiaries of the Caribbean Basin Initiative (CBI), a unilateral U.S. preferential trade arrangement providing duty-free importation for many goods from the region. In the late 1980s, Honduras benefitted from production-sharing arrangements with U.S. apparel companies for duty-free entry into the United States of certain apparel products assembled in Honduras. As a result, maquiladoras or export-assembly companies flourished, most concentrated in the north coast region. The passage of the Caribbean Basin Trade Partnership Act in 2000, which provided Caribbean Basin nations with North America Free Trade Agreement (NAFTA)-like preferential tariff treatment, further boosted the maquila sector. Trade relations expanded most recently as a result of the Dominican Republic- 121 See, for example, Adam Isacson, “When Your Aid Recipients Stop Taking Your Calls,” Center for International Policy, June 28, 2008. 122 John J. Kruzel, “U.S. Limits Contact with Honduran Military,” American Forces Press Service, July 2, 2009; U.S. Department of State, Office of the Spokesman, “U.S. Assistance to Honduras,” July 7, 2009. 123 “Honduras: Ties with US Return to Normal,” Latin News Weekly Report, April 22, 2010. Congressional Research Service 24 Honduran-U.S. Relations Central America-United States Free Trade Agreement (CAFTA-DR), which has significantly liberalized trade in goods and services since entering into force with Honduras in April 2006.124 Total trade between the United States and Honduras has increased 44% since the implementation of CAFTA-DR, with U.S. exports to Honduras growing by 67% and U.S. imports from Honduras growing by 21%. Since a large portion of Honduran exports entered the United States duty free prior to implementation of the agreement, analysts had predicted that CAFTA-DR would lead to a relatively larger increase in U.S. exports. Total two-way trade amounted to $10.6 billion in 2011, $6.1 billion in U.S. exports to Honduras and $4.5 billion in U.S. imports from Honduras. Similar to previous trade arrangements, CAFTA-DR has provided substantial benefits to the Honduran maquila sector. Textiles and apparel (assembled products from the maquila sector) account for 60% of U.S. imports from Honduras. Likewise, textile and apparel inputs, such as yarns and fabrics, account for a substantial portion of U.S. exports to Honduras. Other major U.S. exports to Honduras include oil and machinery.125 U.S. foreign direct investment in Honduras has also increased since the implementation of CAFTA-DR. Total U.S. foreign direct investment exceeded $1 billion in 2010, up 27% from $787 million in 2006.126 The most significant U.S. investments are in the maquila, manufacturing, tourism, agriculture, telecommunications, and energy sectors. According to the U.S. State Department, relatively low labor costs, proximity to the U.S. market, and Central America’s largest port (Puerto Cortés) make Honduras attractive to investors. At the same time, high levels of crime, a weak judicial system, corruption, low levels of educational attainment, and poor infrastructure hamper investment.127 Some Members of Congress have raised questions about the investment climate in Honduras as a result of several cases where U.S.-owned companies allegedly have been driven out of business as a result of anticompetitive practices or have been expropriated without compensation.128 On June 15, 2011, a bill (H.R. 2200, Rohrabacher) was introduced to limit U.S. assistance to Honduras unless the President certifies that the Government of Honduras has settled all outstanding expropriation claims brought by U.S. companies. Despite the increases in trade and investment, some analysts have expressed concerns about the implementation of CAFTA-DR. Labor rights provisions have been of particular concern to many in the United States and Honduras. According to the U.S. State Department, Honduran labor laws are generally satisfactory, however, the government frequently fails to enforce them. In 2010, “union leaders were subjected to violence and threats,” “employers commonly threatened to close unionized factories and harassed or dismissed workers seeking to unionize,” and “factory management in export-processing zones required compulsory overtime, with some factories enforcing this requirement by locking workers inside.”129 In March 2012, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) joined with Honduran 124 For more information on CAFTA-DR, see CRS Report R42468, The Dominican Republic-Central America-United States Free Trade Agreement (CAFTA DR): Developments in Trade and Investment, by J. F. Hornbeck. 125 U.S. Department of Commerce data, as presented by Global Trade Atlas, April 2012. 126 U.S. Department of Commerce, “U.S. Direct Investment Abroad Tables,” Survey of Current Business, September 2011. 127 U.S. Department of State, Bureau of Economic, Energy and Business Affairs, 2011 Investment Climate Statement Honduras, March 2011, http://www.state.gov/e/eb/rls/othr/ics/2011/157290.htm. 128 U.S. Congress, House Committee on Foreign Affairs, Subcommittee on the Western Hemisphere, Next Steps for Honduras, 111th Cong., 2nd sess., March 18, 2010, Serial No. 111-94 (Washington: GPO, 2010). 129 U.S. Department of State, Bureau of Democracy, Human Rights and Labor, 2010 Country Reports on Human Rights Practices – Honduras, April 8, 2011, http://www.state.gov/j/drl/rls/hrrpt/2010/wha/154510.htm. Congressional Research Service 25 Honduran-U.S. Relations trade unions to file a petition with the U.S. Department of Labor. The petition alleges that the government of Honduras has failed to effectively enforce its labor laws and comply with its commitments under CAFTA-DR, and calls on the U.S. government to engage Honduras on these issues to ensure future compliance.130 Migration Issues Migration issues are central to the U.S.-Honduran relationship as more than 625,000 Hispanics of Honduran origin—the equivalent of nearly 8% of the Honduran population—reside in the United States. Some 428,000 (68%) of the Hondurans in the United States are foreign born, 79% of whom have arrived since 1990.131 Immigration from Honduras to the United States is primarily driven by high levels of poverty and unemployment. Given the persistence of those conditions, nearly a third of Honduran citizens who still live in their home country would like to emigrate.132 In addition to relieving social pressure, emigration plays an important role in the Honduran economy. Remittances from migrant workers abroad are the largest single source of foreign exchange for Honduras. They more than tripled between 2002 and 2008 before declining in 2009 as a result of the global financial crisis and U.S. recession, which left many Honduran immigrants unemployed.133 Remittances have since recovered, however, growing by 13% in 2011 to reach $2.9 billion (17% of GDP).134 The United States and Honduras have sought to maximize the development impact of remittance flows under the Building Remittance Investment for Development Growth and Entrepreneurship (BRIDGE) Initiative that was launched in September 2010. Under the initiative, the United States and Honduras partner with financial institutions to leverage the remittances they receive to obtain lower-cost, longer-term financing in international capital markets and fund investments in infrastructure, public works, and commercial development.135 Temporary Protected Status Since Hurricane Mitch struck Honduras in 1998, the U.S. government has provided temporary protected status (TPS) to allow eligible Hondurans—who may otherwise be deported—to stay in the United States. Originally slated to expire in July 2000, TPS has now been extended 10 times. The most recent TPS extension came on November 4, 2011, when the Secretary of Homeland Security announced that the United States would continue to provide TPS for an additional 18 months, expiring on July 5, 2013 (prior to this extension, TPS would have expired January 5, 2012). According to the Federal Register notice on the most recent extension, the Secretary of 130 AFL-CIO, “The AFL-CIO Joins Honduran Trade Unions in Filing a Petition with Department of Labor against Honduran Government for Failing to Enforce Labor Laws under Trade Agreement,” Press Release, March 29, 2012. 131 Daniel Dockterman, Hispanics of Honduran Origin in the United States, Pew Hispanic Center, Statistical Profile, Washington, DC, May 26, 2011. 132 UCA & ERIC-SJ, January 2012, op.cit. 133 “Roundtable Discussion: Outlook for Remittances to Latin America in 2010,” Inter-American Dialogue, April 12, 2010; “Latin America: Remittances Slide,” Economist Intelligence Unit, January 26, 2009. 134 Rene Maldonado, Natasha Bajuk, and Maria Luisa Hayem, Remittances to Latin America and the Caribbean: Regaining Growth, Inter-American Development Bank, Multilateral Investment Fund, Washington, DC, 2012, http://idbdocs.iadb.org/wsdocs/getDocument.aspx?DOCNUM=36723460. 135 Department of State, Office of the Spokesman, “U.S. BRIDGE Initiative Commitments with El Salvador and Honduras,” September 22, 2010. Congressional Research Service 26 Honduran-U.S. Relations Homeland Security determined that the extension was warranted because there continues to be a substantial, but temporary, disruption of living conditions in Honduras resulting from Hurricane Mitch, and Honduras remains temporarily unable to adequately handle the return of its nationals.136 An estimated 66,000 Hondurans residing in the United States benefit from TPS.137 Deportations Deportations to Honduras have increased significantly over the past decade. Approximately 23,800 Hondurans were deported from the United States in FY2011, making Honduras one of the top recipients of deportees on a per capita basis.138 Increasing deportations from the United States have been accompanied by similar increases in deportations from Mexico, a transit country for Central American migrants bound for the United States. Honduran policymakers are concerned about their country’s ability to absorb the large volume of deportees, as it is often difficult for those returning to the country to find gainful employment. Individuals who do not speak Spanish, who are tattooed, who have criminal records, and/or who lack familial support face additional difficulties re-integrating into Honduran society. In addition to these social problems, leaders are concerned that remittances may start to fall if the current high rates of deportations continue.139 Some analysts contend that increasing U.S. deportations of individuals with criminal records has exacerbated the gang problem in Honduras and other Central American countries. Between 2000 and 2004, an estimated 20,000 unauthorized immigrants with criminal convictions were sent back to Central America, many of whom had spent time in prisons in the United States for drug and/or gang-related offenses. Some observers contend that gang-deportees have “exported” a Los Angeles gang culture to Central America, and that they have recruited new members from among the local populations.140 ICE does not provide receiving countries with the complete criminal records or gang affiliations of deportees, however, it may provide them with some information regarding deportees’ criminal histories and gang affiliations when specifying why the deportees were removed from the United States. Likewise, receiving countries may contact the FBI to request criminal history checks on particular criminal deportees once they have arrived. Nearly 48% of the Hondurans deported from the United States in FY2011 were removed on criminal grounds.141 Trafficking in Persons According to the State Department’s 2011 Trafficking in Persons (TIP) Report, Honduras is primarily a source and transit country for men, women, and children trafficked for the purpose of 136 Department of Homeland Security, “Extension of the Designation of Honduras for Temporary Protected Status and Automatic Extension of Employment Authorization Documentation for Honduran TPS Beneficiaries,” 76 Federal Register 68488-68493, November 4, 2011. 137 For more information on TPS, see CRS Report RS20844, Temporary Protected Status: Current Immigration Policy and Issues, by Ruth Ellen Wasem and Karma Ester. 138 Information provided to CRS by the Department of Homeland Security, Immigration and Customs Enforcement, Office of Congressional Relations, October 31, 2011. 139 Pamela Constable, “Deportees’ Bittersweet Homecoming; Migration is Boon, Bane for Honduras,” Washington Post, June 27, 2007. 140 Ana Arana, “How the Street Gangs Took Central America,” Foreign Affairs, May/June 2005. 141 Information provided to CRS by the Department of Homeland Security, Immigration and Customs Enforcement, Office of Congressional Relations, October 31, 2011. Congressional Research Service 27 Honduran-U.S. Relations commercial sexual exploitation and forced labor. Many victims are recruited from rural areas with promises of employment and later subjected to forced prostitution in urban and tourist locales such as Tegucigalpa, San Pedro Sula, and the Bay Islands. Destination countries for trafficked Honduran women and children include Belize, El Salvador, Guatemala, Mexico, and the United States. There are also foreign victims of commercial sexual exploitation in Honduras, most having been trafficked from neighboring countries, including economic migrants en route to the United States. According to a Honduran non-governmental organization, 10,000 children in Honduras are victims of commercial sexual exploitation and some 500,000 are subject to child labor.142 The State Department maintains that Honduras does not fully comply with the minimum standards for the elimination of trafficking, however, it notes that the government is making significant efforts to do so. As a result, Honduras is considered a so-called “Tier 2” country. The State Department’s 2011 report recognized the Honduran government’s law enforcement actions against child sex traffickers, the creation of a draft comprehensive anti-trafficking law, and the launch of an anti-trafficking hotline. Nevertheless, the report maintained that the Honduran government provided minimal services for trafficking victims, that laws failed to prohibit trafficking for forced labor, and that the number of trafficking-related convictions had decreased. The State Department’s recommendations for Honduras include passing a comprehensive antitrafficking law that prohibits forced labor; increasing efforts to investigate and prosecute trafficking offenses; ensuring that specialized services and shelter are available to trafficking victims; and developing formal procedures for identifying and assisting victims.143 Author Contact Information Peter J. Meyer Analyst in Latin American Affairs pmeyer@crs.loc.gov, 7-5474 142 “Casa Alianza: En Honduras 10,000 Niños Sufren Explotación Sexual,” El Tiempo (Honduras), June 11, 2011. U.S. Department of State, Office to Monitor and Combat Trafficking in Persons, Trafficking in Persons Report, June 2011, http://www.state.gov/j/tip/rls/tiprpt/2011/index.htm. 143 Congressional Research Service 28