ASJ denounces that ‘the shortage of dollars in Honduras has been aggravated by political uncertainty’

Kevin Rodríguez, an energy researcher at the Association for a More Just Society (ASJ), said on Tuesday that the shortage of dollars in Honduras is a phenomenon that has been occurring in the country since 2022.

According to Rodriguez, this situation has worsened in Honduras due to several factors, including political uncertainty and the controversial Tax Justice Law, which threatens to increase taxes, thus scaring away investment.

Increase in TPM and its effects on the economy

Rodríguez recalled that, in 2022, when he served as executive director of the Chamber of Commerce and Industry of Cortés (CCIC), he warned the government about the need to implement protective programs before increasing the Monetary Policy Rate ( TPM).

“It was essential to protect sectors such as agriculture and construction to prevent credit from becoming more expensive, which could slow job creation and economic growth,” he said.

According to Rodriguez, at that time, there was already a shortage of dollars, which made it difficult to import essential inputs for agriculture and various industries.

The researcher highlighted that the Central Bank of Honduras did not take timely decisions to mitigate this situation, and the actions only began to be implemented after reaching an agreement with the International Monetary Fund (IMF).

Reasons behind the dollar flight

Asked about the flight of dollars from the country, Rodriguez said that in the first years of the government, one of the reasons was the attraction of better interest rates in other countries.

“It’s like being offered 10% interest in a foreign bank, while a local bank offers you 5%. The logic is clear: you withdraw your money and look for the best return,” he said.

However, he warned that this situation has begun to reverse, as countries such as the United States have begun to lower their rates.

“Despite this trend, the flight of dollars continues due to the political uncertainty in Honduras,” he reiterated.

Rodriguez specifically referred to the controversial Tax Justice Law. “The IMF has recommended increasing credits for the Honduran population, but that means that citizens will pay more for their loans.

“In addition, the Tax Justice Law will increase taxes, which will scare away investment,” he said.

Rodriguez also stressed that the political climate, including statements by President Xiomara Castro about threats of coups, creates an environment of instability that contributes to capital flight.

“When there is fear about the political situation, investors withdraw, and that seriously affects the economy,” he added.