The World Bank In Honduras

In recent years, the Honduran economy has grown moderately, with real GDP increasing by 3.6% in 2024, similar to the growth registered in 2023. This growth is due to robust remittances, lower inflation, and greater access to credit, which boosted consumption and private investment, offsetting weak international demand and adverse climatic factors such as Tropical Storm Sara. 

A slowdown in GDP growth is projected, with growth of 2.8% in 2025 and 3.4% in 2026. This is due to a low dynamism in exports, a deceleration of credit expansion, and greater global uncertainty.. Improvements in agricultural production and public investment could partially mitigate these effects. Although remittances will continue to slow down, they will still represent about a quarter of GDP in the near future. From 2027 onwards, the economy of the country is expected to gain strength gradually, driven by favorable global conditions and more dynamic investment, both public and private. 

In 2024, the annual inflation rate fell to 4.6%, within the target range set by the Central Bank (between 4 and 5 percentage points). This decline was driven by falling international prices and liquidity absorption measures instituted by the same institution. 

Honduras has made progress in reducing poverty, although it remains among the poorest and most unequal countries in Latin America and the Caribbean. It is estimated that poverty, at the threshold of $6.85 per capita per day (2017 PPP), remained relatively stable at 49.3% of the population in 2024 (compared to 49.5% in 2023). Additionally, poverty below the threshold of $2.15 per capita per day remains high, reaching 12.4% of the population in 2024. 

Human development outcomes in the country are among the lowest in the region. According to the World Bank's Human Capital Index, a child born in Honduras will be almost half (48%) as productive when they grow up as they could be if they received a complete education and enjoyed full health. 

To create more opportunities for the Honduran population, especially the most vulnerable, it is necessary to foster greater economic growth, increase productivity and competitiveness, and promote inclusion by improving access to basic quality services and jobs. At the same time, institutional reforms in critical areas such as energy sector sustainability, governance, and the business environment must be carried out.

Last Updated: Apr 23, 2025

The World Bank is supporting Honduras’ efforts to reduce poverty in a sustainable manner by using different tools and instruments, such as loans, grants, technical assistance, and knowledge sharing. The Country Partnership Framework (CPF) sets out the strategy for helping Honduras to create a green, inclusive, and resilient economy. The framework is based on the systematic country diagnostic update (PDF, in English), a comprehensive assessment of Honduras’ challenges in terms of growth and poverty reduction. The CPF is organized around the following high-level results: 

• Better human development outcomes. 

• Inclusive economic development and job creation. 

• Greater resilience to natural hazards. 

The World Bank’s current portfolio in Honduras includes 12 investment projects and two development policy operations that amount to commitments totaling more than USD 1190 million,  USD 35 million of which are grants from the Global Agricultural and Food Security Program (GAFSP) and others, like the Global Financing Facility (GFF), Global alliance for vaccines and immunization (Gavi), Global Partnership for Education (GPE), and Japan Social Development Fund (JSDF). The World Bank’s initiatives in the country support the areas of rural competitiveness, social protection, education, water, health, food security, digital development, transport and disaster risk management. 

Some of the World Bank’s operations that have been approved since the pandemic emergence: 

• an emergency investment project valued at USD 20 million to respond to the threat posed by COVID-19; 

• a stand-by loan for the sum of  USD 119 million to mobilize financial resources to respond to the emergency caused by COVID-19; 

• a USD 110 million loan approved in 2022 to consolidate and expand Honduras' regulatory, policy, and financial framework to enable the country to manage disaster and climate-related risks; 

• a USD 60 million loan to restore essential health services and strengthen public health preparedness capacities to respond quickly and effectively to emergencies; 

• additional financing for the purchase and distribution of vaccines (USD 20 million), to strengthen the social protection system (USD 70 million),  and to support the Rural Competitiveness Project (USD 100 million). 

The World Bank also provided USD 39.5 million to support an investment project geared toward improving the quality of pre-school education services, a USD 45 million project to  improve water supply services in participating urban municipalities, a USD 63 million project to improve water service provision and management in the Dry Corridor [Corredor Seco], and a USD 150 million project to support the country’s reconstruction needs after the passage of hurricanes Eta and Iota. 

Also, the World Bank approved a US$40 million loan to automate birth registration, provide an identification document for children and adolescents, and improve identity verification and authentication services for Hondurans. 

Finally, in 2024, the World Bank and the Government of Honduras signed a project that will support the construction of a new road in the northwestern area of the country to improve the connectivity and resilience of the country's road network. 

Last Updated: Apr 23, 2025

The World Bank is helping Honduras to address the most pressing needs and development challenges in order to improve livelihoods and make an impact on people's lives. 

Disaster risk management (DRM): in November 2020, tropical storms Eta and Iota consecutively hit Honduras and other Central American countries, impacting more than 4.5 million Hondurans and resulting in the death of 95 persons and the evacuation of more than 1 million inhabitants. The World Bank has been supporting the Government’s emergency response and post disaster reconstruction efforts. To date, the Project financed the Government's immediate emergency recovery actions, which benefited approximately 300,000 people (60,000 families). In addition, it has been supporting the resilient reconstruction efforts in critical infrastructure. The Project has delivered 37 schools that take into flood risk and incorporate universal access where possible (another 38 schools remain in various phases of execution); five water supply projects are currently being built, as well as one health center, and three bridges have been delivered with two more under execution. 

Additionally, the Disaster Risk Management Project (PGRD, in Spanish), supported Honduras to strengthening its capacity for DRM at the municipal and national level and improve its capacity to respond promptly and effectively emergencies. Thanks to this project, 18 municipalities adopted DRM and emergency plans and 38 cities improved their livability, sustainability, and/or management. Ultimately, the project benefitted 1.3 million people, out of which 52% were female. 

Governance: the World Bank helped Honduras to update its poverty measurement methodology to include the latest international standards. This will allow for better targeting of social protection programs and the making of informed policy decisions. The National Statistics Institute has received support in terms of knowledge and capacity building to ensure the successful implementation of the project. 

Rural development: the Rural Competitiveness Project (COMRURAL) has contributed significantly to increasing the productivity, competitiveness, and market linkages of 7,200 small rural producers of coffee, dairy, honey, and other products. More than 14,000 families have benefited from the project, of which more than 4,000 are headed by women and more than 5,000 belong to indigenous communities. For every USD 1 invested in COMRURAL, as part of a productive partnership, USD 1.5 have been mobilized from private financial institutions, which is equivalent to approximately USD 12.5 million. This has resulted in the increased financial inclusion and creditworthiness of small farmers. Since 2008, the project has successfully contributed to improving the competitiveness of agricultural value chains, resulting in a 57 percent increase in the gross sales volume of rural producers. COMRURAL-supported producers are responsible for producing almost 30 percent of the total specialty coffee exported by Honduras to the United States, Europe, and Asia. 

Additionally, the project Improving the Livelihoods of Miskito indigenous peoples in the La Moskitia works with the local communities to build from their traditional practices of sustainable agriculture and fishing toward a more diversified and resilient local production system in the face of the multiple external shocks, the communities face, including climate change. This project positively impacted more than 1,200 direct beneficiaries; of these, 66 percent are women. 

Health: The Honduras COVID-19 Emergency Response Project supported the Government of Honduras to close critical gaps in the COVID-19 response, including the expansion of COVID-19 vaccination coverage, particularly through support to mobile campaigns to reach vulnerable and isolated populations. The project supported the Government in ensuring access to critical inputs, including personal protective equipment distributed to all 20 health regions and 32 hospitals based on prioritization and evolving needs. Over 640 pieces of medical and laboratory equipment were also procured and deployed across all 20 health regions. The project also supported strategies for digitalization to improve quality and utilization of vaccination data for decision-making. 

Last Updated: Apr 23, 2025