| Economy Of Honduras |
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Economy of Honduras is the measure of Economic activity in Honduras . It is one of the poorest countries in Latin America . In the 1960s it was the poorest nation of the region, but after the Earthquake in 1972 that devestated Managua , and the two wars that followed ( the first being the one in between the '' Sandinistas '' and '' Anastasio Somoza Debayle '' and the second being in between the '' Sandinistas '' and the '' Contras ''; Nicaragua became the poorest of Central America's modern nations. The economy is based mostly on Agriculture , which accounted for 22% of its Gross Domestic Product (GDP) in 1999 . Leading export Coffee ($340 million) accounted for 22% of total Honduran export revenues. Banana s, formerly the country's second-largest export until being virtually wiped out by 1998 's Hurricane Mitch, recovered in 2000 to 57% of pre-Mitch levels. Cultivated Shrimp are another important export sector. Honduras has extensive Forest , Marine , and Mineral Resource s, although widespread Slash And Burn agricultural methods continue to destroy Honduran forests. Unemployment is estimated at around 4.0%, though Underemployment is much higher. The Honduran economy grew 4.8% in 2000, recovering from the Mitch-induced recession (-1.9%) of 1999. The economy is expected to grow 4-5% in 2001, led by continuation of foreign-funded reconstruction projects. The Honduran Maquiladora sector, the second-largest in the world, continued its strong performance in 2000, providing employment to over 120,000 and generating more than $528 million in foreign exchange for the country. Inflation , as measured by the consumer price index, was 10.1% in 2000, down slightly from the 10.9% recorded in 1999. The country's international reserve position continued to be strong in 2000, at slightly over $1 Billion . Remittances from Hondurans living abroad (mostly in the U.S. ) rose 28% to $410 million in 2000. The lempira (currency) has only moderately Devalued . The country signed an Enhanced Structural Adjustment Facility (ESAF) -- later converted to a Poverty Reduction And Growth Facility (PRGF) with the International Monetary Fund in March 1999. While Honduras continues to maintain stable macroeconomic policies, it has lagged in implementing structural reforms, such as privatization of the publicly-owned telephone and energy distribution companies. Honduras received significant debt relief in the aftermath of Hurricane Mitch, including the suspension bilateral debt service payments and bilateral debt reduction by the Paris Club -- including the U.S. -- worth over $400 million. In July 2000, Honduras reached its decision point under the Heavily Indebted Poor Countries Initiative (HIPC), qualifying the country for interim multilateral debt relief.
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