The Honduran government okayed a 2024 budget of 406 billion lempiras (US$16.4 billion). Finance Minister Rixi Moncada announced this on Friday.
President Xiomara Castro led the cabinet meeting. She began her four-year term in January 2022.
Moncada said government waivers total 60 billion lempiras yearly. To balance this, they plan to borrow 70 billion lempiras.
Despite financial challenges, Honduras is still paying its US$20 billion debt. This includes both domestic and foreign obligations.
Moncada blamed past corruption and debt for the budget imbalance. In 2009, the nation’s debt was US$3 billion. Now it’s US$20 billion.
The new budget focuses on roads, power, water, health, and education.
To better manage money, a Tax Justice Law is needed, said Moncada. The opposition hasn’t backed this law yet.
The budget will go to Parliament on Monday. It must get approved by December 31. The 2023 budget was 392.5 billion lempiras, approved last January.
Honduras Background
The approved budget of US$16.4 billion indicates a notable increase from last year’s. This hike suggests optimism in the government’s economic plans.
However, the need to borrow 70 billion lempiras raises concerns. It shows that the country still relies heavily on loans.
The focus on infrastructure and social sectors is promising. Roads, power, and water are vital for economic growth.
Investment in health and education could lift people out of poverty. But, the overall success depends on how well funds are managed.
Past corruption has hampered financial stability, according to Moncada.
If the Tax Justice Law passes, it might bring in more revenue. This could reduce the need for future loans.
The law’s fate in Parliament is uncertain, given the lack of support from the opposition so far.