00:00In anticipation of an IMF visit to Honduras, the Nasri Azura administration has signaled that it will cancel social programs
00:07and devalue the currency to counter the impact of inflation, a move that could jeopardize the country's ability to meet
00:13required economic benchmarks.
00:15Gerardo Torres Zelaya reports from Tegucigalpa with details.
00:22An international monetary fund IMF mission is currently in Honduras for the sixth round of reviews, and the government has
00:30indicated that it will proceed with an accelerated devaluation of the currency against the dollar, as well as the cancellation
00:37of several social programs in order to secure a $120 million disbursement fund that the government needs to meet its
00:45financial obligations this year.
00:52Ultimately, what the IMF seeks is to ensure that the country maintains solvency indicators sufficient to meet its financial obligations,
00:59its public debt.
01:04The challenge lies in the disconnection between the macroeconomic framework and the microeconomy.
01:11We hear reports of incoming fund disbursements, yet poverty persists.
01:20Inequality remains high, and inflation is elevated.
01:27It is possible that the IMF may conclude that the targets set by the monetary authority will not be met.
01:34In fact, the IMF has already signaled that the country will not achieve all of its established benchmarks.
01:42In less than a year, the lempira, the official currency of Honduras, has gone from 25.5 to 27 lempiras
01:50per each U.S. dollar.
01:52According to the agreement between the government and the IMF, this rapid devaluation will continue, and its impact is already
01:59weighing heavily in the national economy,
02:01particularly for small business owners who import merchandise from the United States.
02:11It's had a significant impact, because previously, we, as resellers, could get a pair of pants for 200 or 300
02:18lempiras at most.
02:19Now, that same pair of pants, even if used or stained, costs as much as 600 lempiras.
02:25So, at what price are we supposed to sell them? People won't want to buy them.
02:34Currently, Honduras has the highest inflation rate in Central America.
02:38And although the general budget has been cut by $1 billion, the indicators for public finance stability have yet to
02:45be met.
02:46It appears that the next items in the chopping block will be the social assistance programs that the Nasri Ascuras
02:52administration inherited from the Xiomara-Caspros administration.
02:57This government is negotiating a new agreement with the IMF, set to begin next year.
03:06My warning to the Honduran people is this.
03:08Unlike the agreement negotiated by President Xiomara, which, while facilitating the repayment of public debt,
03:15also included a major investment program for subsidies, infrastructure, and the well-being of the people.
03:24This government, unfortunately, lacks that vision.
03:27Instead, it is focused solely on business dealings.
03:30That is why it slashed more than 25 billion lempiras from the budget,
03:34a move it even touted as a major achievement.
03:37In short, while they may negotiate a repayment plan with the IMF,
03:40they are not negotiating for the well-being of the Honduran people.
03:46Honduras now has a neoliberal government that aims to reduce the state's presence as much as possible.
03:52To secure an agreement with the IMF, it will continue to sacrifice social welfare projects,
03:58as the cost of living keeps rising due to inflation and currency devaluation.
04:04For Tele Sur in English, from Tegucigalpa, Honduras, Gerardo Torres Zelaya.
