Honduras finds itself entangled in a financial dilemma with Taiwan, its former key trading partner. Despite the severing of bilateral relations nearly a year ago, the Central American nation remains indebted to Taiwan, posing challenges for its shrimp export sector.

Mounting Financial Obligations

The Ministry of Finance in Honduras revealed that by the end of 2023, the debt with Taiwan amounted to USD 440 million. This debt encompasses various financial obligations, including a significant sum owed to the Land Bank of Taiwan, which stood at USD 3.3 million by the close of 2023.

The origins of this debt trace back to as early as 1999, indicating a prolonged period of financial interdependence between the two nations. Notably, no loans were acquired during the tenure of the Xiomara Castro administration, with the last loan granted in 2019 under the government of Juan Orlando Hernández, amounting to USD 300 million.

Impact on Shrimp Export Industry

The fallout from the breakdown in bilateral relations with Taiwan has reverberated across various sectors, particularly impacting the shrimp export industry. Taiwan had long been a primary destination for Honduran shrimp exports, benefiting from favorable tariff arrangements. In light of recent developments, Honduras is now striving to pivot its shrimp exports towards China, aiming to secure comparable tariff benefits.