1942: Honduras

The arrival of United States health specialists in Honduras in June indicates progress towards the cooperation between the United States and Latin America, foreshadowed at Rio, on health and sanitation measures. Experts had already been sent to Ecuador and Brazil. Economic cooperation has taken the form of an exclusive rubber purchasing agreement, signed in the summer, which in September brought the total of such agreements up to eight. (Similar agreements had already been concluded with Brazil, Perú, Nicaragua, Costa Rica, Colombia, Bolivia and Ecuador.) A rubber cultivation contract has also been signed with the Firestone interests. A loan from the United States was reported in the spring, the amount not indicated, to be applied in part to highway construction, especially on an unfinished 90-mile section of the Inter-American highway, and in part to defense requirements and to bolstering the Republic's internal economy. The acceptance of such aid represents a change in President Carías' former stand against foreign borrowing.

Honduras, as one of the banana republics, has been seriously affected by the shortage of shipping. Normally, bananas account for over 60 per cent of the country's exports. To meet this situation the United Fruit Company and others have embarked on a program of agricultural expansion in all Central America, planting abacá (manila hemp) in Panama and Costa Rica; rubber in Honduras and Costa Rica. Plans are also proposed for cultivating other tropical products hitherto imported from the Far East. Dehydration of bananas is offered as another solution. The rehabilitation of the Mexican Railways, to permit overland movement of coffee and bananas, and the completion of highway facilities in Central America, are significant in this respect.

Since the settlement of the Ecuadorean-Peruvian boundary dispute (see ECUADOR) the frontier dispute between Honduras and Nicaragua over the eastern half of their common boundary remains the only one of any consequence in Latin America.

1941: Honduras

The dropping of the pretense of neutrality in the World War throughout the Caribbean area was demonstrated early in the year in Honduras, first, by the ousting of the German Chargé d'Affaires in March 1941, as persona non grata because of his propaganda activities, and, later, by a presidential order barring Axis sympathizers from government positions. Following the Japanese attack on the United States, in the bombing of Pearl Harbor on Dec. 7, Honduras joined the other Central American states in declaring war on the Axis Powers.

A mediation commission, representing the United States, Venezuela and Costa Rica, met in Costa Rica in March to discuss the boundary controversy between Honduras and Nicaragua. At the end of the year it was reported to be nearing a settlement.

1940: Honduras

Although no longer the world's leading banana exporter, Honduras is a 'banana republic,' since exports of that fruit are the source of some 80 per cent of government income and the trade balance. The United Fruit Company's concentration on that single crop is so great that foodstuffs must be imported from El Salvador and Nicaragua. The output has been seriously affected in recent years, however, by the sigotaka leafspot disease, which is now being brought under control. Gold, produced by the Rosario mines, is the only other important export. A group of North American technicians will make a study of possibilities of rubber production here, as well as in Costa Rica and Panama, looking towards development of rubber production in the Western Hemisphere (see COSTA RICA).

The 'gentleman's agreement' with Nicaragua over a boundary dispute, arranged by a conciliation commission composed of United States, Costa Rican and Venezuelan arbitrators, expired Jan. 22, but the two governments recently adopted a non-aggression pact, which relieves the former tension over the border question. By this agreement both governments consented to remove troops from the disputed border.

The 1939-40 budget estimated revenues at 11,403,000 lempiras, expenditures at 11,026,000 lempiras. Payment in 1939 was continued on the external debt, annual service amounting to $200,000.

1939: Honduras

A Central American Republic, Honduras lies between the Caribbean Sea and the Pacific Ocean, bounded south by Nicaragua, west by the Gulf of Fonseca, Salvador and Guatemala, and north and northwest by the Caribbean. Honduras has a total area of approximately 46,250 sq. mi. and a coastline of 450 mi. The total population by the 1937 estimate was 1,000,000, almost entirely of mixed Spanish and Indian-blood but including a Negro element and about 35,000 aborigines.

The most important crop is bananas, which accounts for over 65 per cent of the total value of exports. Other important products are coconuts, nuts, coffee, corn, beans and sugar cane. Silver is the most important mineral, although gold, copper, lead, zinc, antimony and iron have also been found. Honduran trade has suffered severely from the banana blight. Sigatoka, which has cut banana exports from a high of 29,000,000 stems in 1930 to less than 13,000,000 stems in 1937. By installing piping on the large plantations to spray the crops with copper sulphate, the worst ravages have been checked, and in 1939 the yield was estimated at about 14,700,000 stems. Total exports in 1938 (for an 11-month period) were valued at $7,356,000; total imports at $9,468,000. The United States absorbs 89 per cent of the exports and provides 58 per cent of the imports.

Under a new Constitution effective in 1936, Honduras is governed by a unicameral Congress, the 38 members of which are elected for six-year terms, and administered by a President assisted by a Cabinet. A Permanent Commission of 5 members sits while Congress is not in session for emergency and routine matters. Congress in March 1937 extended its own term to Dec. 4, 1942, and that of President T. C. Andino, who assumed office in 1933 and was since reelected, to Jan. 1, 1943 (from 4 to 6 years).

Under the Andino dictatorship, the moves of the Government and internal policies are rigidly censored. Reports of revolutionary movements seep out at intervals, and there is an insurrectionary party operating continuously against the Government, as is evidenced by such episodes as the fining of one Bjorne Olsen in May 1939 for conspiracy to smuggle rifles to revolutionists in Honduras. In foreign affairs, the year ended without any settlement of the dispute between Honduras and Nicaragua over a border strip good for banana growing, but without serious altercation.

1938: Honduras

The peace pact signed by Nicaragua and Honduras on Dec. 10, 1937 ended the immediate threat of war over an old boundary dispute, but permanent settlement of the controversy, which has been the subject of mediation by a commission representing Costa Rica, Panama and the United States, has been further postponed. On Jan. 2 President Somoza announced that all Nicaraguan troops had been withdrawn from the Honduran frontier. The pact provided a truce in radio and press comments and in military preparations. Both countries have charged violations of the agreement on the part of the other. Honduras protested against the arrival in January of a shipment of modern armament, purchased by Nicaragua in Europe but prior to the pact with Honduras. In December it was Nicaragua's turn to protest to the boundary commission against the arrival of a shipment of arms for Honduras, although the agreement not to purchase arms for a six months' period had lapsed.

The budget for the fiscal year 1937-38 estimated receipts at 12,224,219 lempiras and expenditures at 11,811,628 lempiras.