US embassy cable - 05TEGUCIGALPA1380

UNCLAS TEGUCIGALPA 001380 
 
SIPDIS 
 
DEPT. FOR WHA/PD; IIP/G/WHA DIPASQUALE; AND IIP/T/ES 
DEPT. FOR PM AND EB/TRA 
DEPT. FOR WHA/EPSC, WHA/PPC AND WHA/CEN 
 
E.O. 12958: N/A 
TAGS: OIIP, KPAO, PGOV, MASS, EAID, HO 
SUBJECT: MEDIA REACTION ON DEBT FORGIVENESS, JUNE 28, 2005 
 
 
1. The Tegucigalpa-based liberal daily "La Tribuna" 
published an op-ed by Juan Ramon Martinez entitled "Debt 
Forgiveness and Wealth Creation."  "Debt forgiveness is a 
governmental and legislative success but has been received 
by some in a strange way." 
 
"It was during Carlos Roberto Reina's government that things 
were forced so that Honduras could qualify as a heavily 
indebted poor country." 
 
"In that moment we considered it to be the wrong way to go 
but during Flores' government we were hit by Hurricane Mitch 
and we concluded that it was the only way we had left mostly 
because only a solid fiscal disciplinary base could correct 
the government's mess and to create the structure for a path 
and national transformation in which we could build a growth 
process of the economic forces." 
 
"We must take the money from the government and deliver it 
to the citizenship by doubling the minimum wage." 
 
"We need to create a favorable climate for investment, 
wealth creation and employment." 
 
"Once such conditions are created we can put in order the 
commercial balance so actual consumer tendencies will be 
reduced; even better, an internal market can be developed 
that will create national and international economic forces 
to respond to the new urgencies and needs." 
 
"We need to review the wealth distribution system to amend 
injustice, putting the economy to serve the people and not 
just a few as it occurs presently." 
 
2. The San Pedro Sula-based liberal daily "Tiempo" carried 
an op-ed by Gustavo A. Aguilar L. entitled "External Debt 
and Development in Honduras."  "The process of Honduras' 
accruing of external debt in Honduras started in the 50s, a 
decade marked by social change, as the country sought its 
place in the global economy.  After WWII, economies as well 
as countries started to modernize their economic and social 
structures, and created organizations for economic and 
social development." 
 
"A country's indebtedness begins to increase because of the 
necessity of public investment. Because Honduras lacked 
internal savings, it had to find funding from the 
international multilateral financial institutions such as 
the IDB, World Bank and bilaterally from friendly 
governments interested in contributing to the development of 
our country." 
 
"The big problem with the way that Honduras has been 
increasing its debt has been the lack of an orderly planning 
process for economic development. On the one hand, there has 
been no long-term focus and, on the other, external debt has 
been a source of illicit gains for the project managers and 
the institutions that have managed the financial resources." 
 
"Currently, the rich countries (G-8) have considered debt 
relief for $1.2 billion, a large portion of current debt. 
Debt relief has also been considered for loans granted by 
the World Bank and the IMF. It is possible that as a 
consequence, there will be strategic financial focus and 
development of the country." 
 
"At this moment there needs to be a plan for the efficient 
use of the new available resources. These funds need to be 
placed within the National Budget and within projects that 
would have a valuable impact on production, education, 
health, the modernization of public management and the 
contribution of the private sector." 
"The government gives itself credit for the work done by 
many protagonists, including past administrations, Cardinal 
Oscar Andres Rodriguez, and our people who have paid their 
share in sacrifice and strife for economic improvement." 
 
Palmer