García & Bodán

National and Foreign Investment in Honduras

National and foreign investment in Honduras presents interesting benefits because it is a country with a lot of potential. Even though the economic, political, and the legal and civic security situation of the region hasn’t been the most enviable in the past years, the country represents a platform of opportunities that should be used.

It is important to mention the geographic location of the country within its qualities, since it is located in the center of the American continent, which facilitates the commerce. At the same time, it counts with diverse bilateral and multilateral agreements like RD CAFTA, Free Trade Agreement between Mexico and the North Triangle, Free Trade Agreement with Peru, Free Trade Agreement between Central America and Panama, Free Trade Agreement with Chile, among others, that represent attractive conditions for the national and foreign investment in Honduras.

Also, the Government of the Republic gives exemptions in diverse areas of the economy, for example in the energy generation, where the different involved parts in the projects may count with tax exemptions like Income Tax, Net Asset Tax and the Sales Tax. Additionally, the Call Centers businesses count with exemptions, since the Law promotes these types of businesses in the country because an important part of the population speaks English and therefore the employment generation is given. Also it’s possible that investors use the establishment of Free Zones, that enjoy tax exemptions in an extensive diversity of categories and that may be settled in any part of the country.

It is relevant to mention the recent implementation of the First Customs Union that took place in Central America on June 26th, 2017, thus making a fundamental step into the regional economic integration. With the union it will be possible to introduce the use of the Central American Invoice and Single Declaration that would facilitate the documentary, tax payment, electronic pre check of migratory drivers and the introduction of merchandise by the integrated border posts.

For the sake of simplifying processes and achieving the attraction of more national and foreign investment, recently it was formalized an electronic portal that helps the speedup of business constitution procedures and the subsequent permits that are required in order for the company to initiates its operations in an agile way.

It is necessary to mention that the diverse benefits mentioned before are cited in an exemplifying way, but they do not contain the total benefits that may be enjoyed through the foreign and national investment in different areas of the national economy.

Vanessa Oquelí de Riera
Managing Partner
García & Bodán
Honduras