Honduras is a lower middle-income country located in Central America with a population of more than 8 million. It is best known for the production of minerals, coffee, tropical fruit and sugar cane, as well as for its growing textiles industry. Honduras presents one of the highest poverty rates in Latin America: it is estimated that more than 40% of the population lives in conditions of extreme poverty, particularly in rural areas. Honduras is one of the few countries in Latin America where poverty has not diminished in the last ten years while social differences have remained very high.
Among the challenges that Honduras is still facing are the slow economic growth - which is not able to compensate for the rapid demographic growth - and the increasing level of public debt. In addition, as a small open economy, it is vulnerable to external shocks. The country is also known for being one of the most violent countries in the world and is continuously ranked as having one of the world's highest homicide rates. In 2009, Honduras went through a serious political crisis during which the President was ousted, however, since 2010 it has returned on the democratic path.
Honduras is signatory to the EU-Central America Association Agreement, a comprehensive free trade agreement with a strong focus on development cooperation. In this context, the country benefits from the EU regional programme for Central America.
The EU support for the period 2014–2020 provides an allocation of €235 million concentrating on food security with a focus on family agriculture, decent employment and rule of law as main sectors. In addition the EU provides support to the forest sector as Honduras is one of the world's most vulnerable countries to climate change effects. Honduras will continue benefiting during 2014-2020 from the EU sub-regional programme for Central America (€120 million). It must be noted that the focal sectors of cooperation for the sub-regional have evolved for this period. In the past, cooperation was mainly focused on social cohesion and economic growth, while the new programming exercise responds to the emerging needs of the region. The main development challenges facing the country are reduction of poverty and inequality, food security, investing in people (education and health), human security and human rights, fiscal reforms, fight against impunity and corruption, employment generation with social protection, competitiveness, natural resources management, and vulnerability to climate change.
The EU provided €223 million to Honduras under the EU Development Cooperation Instrument in the period 2007-2013. The priorities outlined were the promotion of social cohesion, the management of forestry resources and the improvement of the justice system and citizens' security.
EU's cooperation in Honduras has been particularly successful in the area of sustainable management of natural resources. In the context of the Voluntary Partnership Agreement of Forest Law Enforcement, Governance and Trade (VPA FLEGT) negotiations, indigenous peoples are participating as a distinctive stakeholder group in the negotiation committee since 2012. Thanks to the EU a number of local indigenous communities have developed management plans for the protected areas they inhabit. The plans allow local farmers to diversify their agricultural produce and increase their family income while at the same time protect the water and forest resources.
The EU is also providing support to non-governmental organisations in Honduras to promote food security and human rights, and gender equality. At present some 35 thematic projects are ongoing for total of more than €9 million, the large share of which focus on support to civil society organisations and local authorities.