For anyone looking to make a successful business entry into Latin America, whether for local markets, or for nearshoring activities, Honduras cannot be one of the options to be ruled out. Decades of steady growth, an ever-improving security situation, and good conditions for foreign companies combine to make the country an increasingly attractive option.
Honduras has one of the fastest growth potentials in the region, largely thanks to its strategic location and a growing industrial base, but above all, thanks to a young and constantly growing population.
In fact, according to the World Bank, Honduras has the second highest economic growth rate in Central America, surpassed only by Panama. The country’s GDP growth reached 4.8% in 2017, 3.7% in 2018, and 2.7% in 2019, well above the average in Central America.
For 2021 and 2022, the Government of Honduras maintains its economic growth forecast of between 3.2% and 5.2%, which continues to be positive. After 25 years of almost uninterrupted annual growth of its GDP, Honduras recorded a GDP of $ 25.1 billion in 2019.
In this context, nearshoring investments are positioned as the most prosperous and attractive. And in this area, one of the greatest investment opportunities is facilitated by Grupo Karim’s, one of the most solid and innovative groups in the Central American region, with presence in countries such as Guatemala, Mexico, the United States, and of course Honduras.
Thanks to its innovative and successful Altia Smart Cities, the Group has catapulted Honduras as the center of gravity of business for the BPO and ITO sectors, generating more than ten thousand jobs within its two projects. With that in mind, let’s look at the advantages of investing in Honduras.
The 3 reasons why you should invest in Honduras
An excellent geographical position
Honduras is the second largest country in the Central American region, located between Guatemala and Nicaragua. In addition, the country has coasts that provide commercial access to the Pacific and Atlantic oceans through four ports, and is close to the largest market in the world: the United States.
The country has a growing road network, thanks to which the main cities are connected by thousands of kilometers of multi-lane highways. It also benefits from having fast direct flights with the North American giant, as Tegucigalpa is just over three hours from Houston, and even closer to Miami.
Extremely competitive working conditions
Honduras has an increasingly urbanized and young population, with an average age of 24.3 years, which provides an incomparable supply of workers for new companies dedicated to technology or services. It also has highly competitive labor costs that are very attractive to investors.
The country has a growing pool of skilled labor, as well as a relatively high level of English proficiency, notably higher than major investment destinations in Latin America such as Brazil, Colombia, and Mexico.
Free trade zones
Honduras offers investors generous tax benefits. In 2010, the Investment Incentive and Protection Law was enacted, creating the legal framework to facilitate the arrival of foreign direct investment. These incentives include tax exemptions under certain circumstances for companies that invest in the country.
The Free Zone Law in force in the country also allows commercial and industrial companies to establish and operate with this status, provided that their operations are related to exports and complementary activities. It is for this reason that both Altia Smart City and Green Valley Advanced Manufacturing Hub, two of Grupo Karim’s real estate projects, are within a free zone.
You should also read Free trade zones and their benefits for the industries of Honduras