Honduras: Out of control, and at risk of becoming a failed state

The Economist

When soldiers bundled Honduras’s elected president onto an aeroplane to Costa Rica in a coup in 2009, nobody believed that the Central American country would swiftly get back to normal. But even pessimists must be disappointed by what has happened. Although the constitutional crisis was resolved early in 2010 after the election as president of Porfirio Lobo and the return of Manuel Zelaya, his ousted predecessor, Honduras continues to march backwards. Gang violence, catalysed by drug trafficking, and weak law enforcement have given Honduras the highest murder rate in the world. Poor financial management and the hangover from a stop to aid after the coup have left the government struggling to pay its bills. And Congress has picked a fight with the judiciary, creating fresh constitutional strains just as the country gears up for another presidential election in November.

The scale of violence is dizzying. Last year saw 86 murders per 100,000 people according to the National Autonomous University. That was about the same as in 2011, but more than double the Central American average—itself among the highest in the world (see chart). In 2012 Honduran men in their 20s faced a 1-in-300 chance of being murdered, or 1-in-150 in the most dangerous towns.

Drug mafias, under pressure in Mexico, have set up in Honduras. In January the authorities discovered a cache of weapons, including a gold-plated AK-47, believed to belong to Mexico’s “Zetas” mob. Honduras’s wild coast and empty jungle provide landing points for some 40% of cocaine destined for the United States. Traffickers pay their hired help in drugs rather than cash, creating a local market and the mayhem that goes with it. Some of the violence comes from gangs known as maras, which migrants form in jails in the United States and remain members of in Central America after they are deported.

Then there are seemingly targeted assassinations. At least 25 journalists, including eight last year, have been killed since the coup. Some members of the opposition have accused the government of snuffing out dissent. But Robert Marín, a reporter on El Heraldo, a newspaper, who has himself received threats, points out that journalists of all political stripes (and none) have been victims. So, too, have gay-rights campaigners—at least eight were killed last year—and lawyers, 15 of whom were murdered. However, these are by no means the people most at risk: some 60 taxi drivers were killed in 2012, in many cases following extortion attempts, and about 70 police. Last month the teenage son of a former police chief was shot dead.

The underlying problem is that few of the killings are investigated, let alone punished. Even as Honduras’s murder rate has doubled, the number of police has fallen, from about 14,000 in 2009 to 13,000 now. Many supplement their $400 monthly wages by charging a “war tax” on citizens. A vetting programme begun in August tested 1,231 officers by the end of the year, firing 281 of them. A further 450 left voluntarily. The remainder are due to be vetted this year, and a thousand more recruited annually until the force reaches 20,000. Training time has been doubled, to 12 months.

It will take a decade fully to restore faith in the police, which had “fallen into total discredit”, admits Héctor Mejía, the force’s spokesman. The army patrols with the police in Tegucigalpa, the capital, and in the northern city of San Pedro Sula, as part of an “emergency” measure renewed three times since it was introduced in 2011.

Many Hondurans are taking protective measures into their own hands. In Villa Cecilia, a small working-class suburb of mechanics, seamstresses and policemen in Tegucigalpa, residents pay 700 lempiras ($35) per household per month to employ four security guards with shotguns. Next will come CCTV, an entry-phone system and a bigger perimeter wall. “If you want to sleep well, you have to pay”, shrugs Jiovanny Aguilera, a taxi driver whose home is protected by two metal doors, barbed wire, and a pair of large dogs. The city government has encouraged such barrios seguros, permitting residents to block off their streets. The poorest districts, built on steep hillsides lacking formal roads, remain unsealed.

Despite the violence, Honduras’s economy grew by a respectable 3.3% last year, and clocked up record (legal) exports. A free-trade deal with Central America and the United States has helped to attract maquila factories and call-centres, and to protect investments from political turbulence. Remittances keep consumption going, as shown by the glitzy shopping malls mushrooming in the capital.

But the resilient economy hides weak public finances. The government’s unpaid bills to its workers and contractors amount to 4% of GDP. Many teachers have stopped turning up at school. A standby agreement with the IMF has not been renewed. As a result, the World Bank has halted its budget support, though it plans to step up other project funding. The government has turned to borrowing in the expensive local market. It is considering an international bond issue. But last month Moody’s, a credit-rating agency, changed its outlook on Honduras’s already weak credit rating to negative. The government has told several loss-making state-owned companies to come up with reform plans by the end of March. But any savings may be squandered in the run-up to the election.

Honduras’s politics has become as dysfunctional as its government and security forces. In December Congress voted to sack four Supreme Court justices who had repeatedly found new laws to be unconstitutional. Their replacements have been more co-operative, approving several controversial laws. One gives the legislature the power to sack senior public officials. “The rule of law in this country has broken down”, says Ramón Custodio, head of the official but independent Human Rights Commission. He is among the officials who can now be fired by Congress. He also worries about a media bill that promises new taxes and regulations, which newspapers have described as censorship.

The head of Congress, Juan Orlando Hernández, is the candidate of the ruling National Party in the presidential race. Polls show him neck and neck with Xiomara Castro, Mr Zelaya’s wife. Salvador Nasralla, a television personality, is running for a new Anti-Corruption Party. He has little chance of winning, but he may split the anti-Zelaya vote, to Ms Castro’s advantage. If Honduras is to halt its spiral of decline, it desperately needs strong democratic leadership and an end to its political splits. Neither looks likely.