Previously called Spanish Honduras thus distinguishing the Central American republic from British Honduras (now Belize), Honduras shares its western border with Guatemala, southwest border with El Salvador and southeast border with El Salvador. The republic’s south coastline is along the Pacific Ocean at the Gulf of Fonseca while the Honduran north coastline is surrounded by the Gulf of Honduras, a large Caribbean Sea inlet.
The latest available country-specific data from 2017 shows that 84.1% of products exported from Honduras were bought by importers in: United States (40.2% of the global total), Germany (7.9%), Belgium (7%), Netherlands (5.9%), El Salvador (5.8%), Guatemala (4.5%), Nicaragua (4.1%), United Kingdom (1.9%), Costa Rica (1.9%), Italy (1.7%), Spain (1.7%) and Mexico (1.5%).
From a continental perspective, 42.5% of Honduras exports by value were delivered to North American countries while 29.7% were sold to European importers. Honduras shipped another 20.9% worth of goods to Latin America excluding Mexico but including the Caribbean. Smaller percentages went to Asia (3.7%), Oceania (0.5%) led by Australia, then Africa (0.1%).
Given Honduras population of 9.2 million people, its total $8.2 billion in 2018 exports translates to roughly $900 for every resident in the Central American country.
In macroeconomic terms, Honduras’ total exported goods represent 16.8% of its overall Gross Domestic Product for 2018 ($49.2 billion valued in Purchasing Power Parity US dollars). That 16.8% for exports to overall GDP in PPP for 2018 compares to 20.8% for 2014, seeming to indicate a relatively decreasing reliance on products sold on international markets for Honduras’ total economic performance. And while this article focuses on exported goods, it is interesting to note that Honduras also provided $2.9 billion worth of exports-related services to global customers for an additional 5.9% of GDP in PPP.
Another key indicator of a country’s economic performance is its unemployment rate. Honduras’ unemployment rate was 6.7% in 2017 down from 7.4% one year earlier, according to Trading Economics.
Honduras Top 10 Exports
Top 10
The following export product groups represent the highest dollar value in Honduran global shipments during 2018. Also shown is the percentage share each export category represents in terms of overall exports from Honduras.
- Knit or crochet clothing, accessories: US$2.6 billion (32.1% of total exports)
- Coffee, tea, spices: $1.1 billion (13.2%)
- Electrical machinery, equipment: $735.9 million (8.9%)
- Clothing, accessories (not knit or crochet): $613 million (7.4%)
- Fruits, nuts: $605.9 million (7.4%)
- Animal/vegetable fats, oils, waxes: $382.8 million (4.6%)
- Fish: $310.2 million (3.8%)
- Vegetables: $140 million (1.7%)
- Tobacco, manufactured substitutes: $120 million (1.5%)
- Gems, precious metals: $112.5 million (1.4%)
Honduras top 10 exports accounted for over four-fifths (81.9%) of the overall value of its global shipments.
Knit or crochet clothing, accessories: was the fastest-growing among the top 10 export categories, up by 60,433% since 2017.
In second place for improving export sales was unknit or non-crocheted clothing and accessories which rose 6,059%.
Honduras’ shipments of fruits and nuts posted the third-fastest gain in value, up 68.8%.
The leading decliner among Honduras’ top 10 export categories are fish via a -31% drop year over year.
At the more granular four-digit Harmonized Tariff System code level, coffee represents Honduras’ most valuable exported product at 13.1% of the country’s total. In second place were knitted or crocheted jerseys and pullovers (13%) trailed by knitted or crocheted t-shirts and vests (11.3%), insulated wire or cable (7.9%), bananas and plantains (3.9%), palm oil (3.8%), crustaceans including lobsters (2.8%) melons, watermelons and papayas (2.7%) unknitted and non-crocheted bras and corsets (1.9%) then knitted or crocheted stockings and hosiery (1.8%).
Advantages
The following types of Honduran product shipments represent positive net exports or a trade balance surplus. Investopedia defines net exports as the value of a country’s total exports minus the value of its total imports.
In a nutshell, net exports represent the amount by which foreign spending on a home country’s goods or services exceeds or lags the home country’s spending on foreign goods or services.
- Knit or crochet clothing, accessories: US$2.4 billion (Reversing a -$42.6 million deficit)
- Coffee, tea, spices: $1.1 billion (Down by -16.4%)
- Fruits, nuts: $557 million (Up by 81.4%)
- Clothing, accessories (not knit or crochet): $532.3 million (Reversing a -$64.1 million deficit)
- Animal/vegetable fats, oils, waxes: $339.8 million (Down by -1.5%)
- Fish: $306.8 million (Down by -30.1%)
- Vegetables: $124.9 million (Up by 121.9%)
- Gems, precious metals: $98.7 million (Down by -27.8%)
- Ores, slag, ash: $98.1 million (Up by 75.4%)
- Tobacco, manufactured substitutes: $93.8 million (Up by 50.6%)
The Honduras has highly positive net exports in the international trade of knitted or crocheted clothing and accessories. In turn, these cashflows indicate Honduras’ strong competitive advantages under that product category.
Opportunities
Honduras incurred an overall trade deficit of -$2.1 billion during 2018, down -42.3% from -$3.6 billion in red ink one year earlier.
Below are exports from Honduras that result in negative net exports or product trade balance deficits. These negative net exports reveal product categories where foreign spending on home country Honduras’ goods trail Honduran importer spending on foreign products.
- Mineral fuels including oil: -US$1.4 billion (Up by 12.8% since 2017)
- Machinery including computers: -$754.4 million (Up by 20.8%)
- Cotton: -$718.3 million (Up by 6,593%)
- Manmade staple fibers: -$526 million (Up by 5,884%)
- Vehicles: -$394.8 million (Down by -29.9%)
- Plastics, plastic articles: -$375.8 million (Up by 23%)
- Paper, paper items: -$272.7 million (Up by 278.3%)
- Electrical machinery, equipment: -$242.7 million (Up by 31.3%)
- Cereals: -$242.1 million (Up by 30%)
- Iron, steel: -$238.3 million (Up by 1.4%)
Honduras has highly negative net exports and therefore deep international trade deficits for refined petroleum oils, cotton yarn excluding sewing thread, and smartphones.
These cashflow deficiencies clearly indicate Honduras’ competitive disadvantages in the processed fossil fuel market, but also represent key opportunities for Honduras to improve its position in the global economy through focused innovations especially for alternative energy.
Companies
Honduran Export Companies
Not one Honduran corporation ranks among the companies showcased by the Forbes Global 2000.
Wikipedia does list companies from Honduras that engage in international business pursuits. Selected examples are shown below:
- AeroCaribe de Honduras (airliner)
- Aerolíneas Sosa (airliner)
- InterAirports (international airports administrator)
- New York and Honduras Rosario Mining Company (gold, silver)
- Tegu (toys)
Tegucigalpa is the Honduran capital city.
See also Honduras Top 10 Imports, Coffee Exports by Country and Bananas Exports by Country
Research Sources:
Forbes 2015 Global 2000 rankings, The World’s Biggest Public Companies. Accessed on June 22, 2018
International Monetary Fund, World Economic Outlook Database (GDP based on Purchasing Power Parity). Accessed on July 9, 2019
Investopedia, Net Exports Definition. Accessed on June 22, 2018
The World Factbook, Country Profiles, Central Intelligence Agency. Accessed on June 22, 2018
Trade Map, International Trade Centre. Accessed on July 9, 2019
Wikipedia, Gross domestic product. Accessed on July 9, 2019
Wikipedia, Honduras. Accessed on June 22, 2018
Wikipedia, List of Companies of Honduras. Accessed on June 22, 2018
Wikipedia, Purchasing power parity. Accessed on July 9, 2019