Programme Index Listing

Location
Honduras
Main implementer
ACDI/VOCA
Other implementers
Nathan Associates / LINC / Alterna / Zamorano
Donor
USAID
Duration
2018 - 2025
Total budget
USD $50 million
Annual budget
USD $7 million

Project description / objective

More competitive, resilient and inclusive market systems that increase sustainable economic opportunities. This includes:

  • increasing business sales and jobs for Hondurans, including vulnerable populations
  • reducing incentives to migrate while building the foundation for broad-based, long-term economic growth

Market systems focus

1. Agriculture

Focus on adding value to farm and off-farm products through rural and agricultural enterprise.

Priority sub-sectors include fruits and vegetables, dairy, coffee, meat (beef, poultry, and pork), cocoa and cocoa products, forest products (timber and non-timber) and spices.

2. Tourism and creative industries

Focus on the development of competitive destinations that benefit a range of enterprises including accommodation, food services, tourist attractions, artisanal crafts and complementary activities.

Priority destinations include Occidente (culture and nature), Tela and La Ceiba (sun, beach and nature), Tegucigalpa and San Pedro Sula (MICE).

3. Entrepreneurship services

Focus on business advisory, financial services and ICT to create a dynamic entrepreneurial ecosystem that benefits opportunity-driven MSMEs.

Priority businesses include women, youth and indigenous-owned businesses in both ‘traditional’ MSME and technology start-up spaces.

4. Business enabling environment

Focus on strengthening private sector organisations to lead reforms and champion a more business-friendly enabling environment.

Priority reforms include administrative simplification, improving legal and regulatory frameworks, a pro-growth tax system and other reforms necessary to address pequeñismo, a trend whereby businesses remain small and informal.

Programme interventions

1. Value-added agriculture

Increase market access and new product development

  • Identify export market opportunities for agro-industry
  • Match exporters with third-party certifications
  • Attract regional and international investors
  • Establish new regulatory and business models e.g. agro-parks to encourage direct investment in agro-industry.

More efficient and inclusive supply chains established

  • Partner with lead agro-industry firms to improve their supply chain models and practices
  • Align incentives to be more responsive to end market opportunities
  • Work to reduce costs in intermediary functions of traceability, transport, logistics and primary processing through micro-enterprise development

Improved support services available for agro-industry

  • Expand sustainable provision for market intelligence, marketing and investor facilitation services
  • Develop public-private models with research institutions for product development support (scoping product costs, specifications, labeling, etc.)

2. Tourism and creative industries

Improved perception and image of Honduran destinations

  • Develop unified strategic communication and crisis management framework for tourism
  • Support promotional campaigns and promote user-generated social media content
  • Streamline public-private marketing initiatives and co-finance familiarisation trips
  • Strengthen convention bureaus to host MICE events

Destinations deliver integrated tourism experiences

  • Facilitate new unified policy-driven framework and tourism governance mechanism for tourism districts
  • Strengthen destination-level tourism organisations and regional chambers
  • Implement public-private partnership models to coordinate and make investments at destination-level to generate tourism experiences

Innovated products and services by tourism enterprises

  • Differentiate product and service offer of tourism enterprises to strategic visitor profiles through market-ready model
  • Support adoption of digital technologies: e-marketing, online booking and social media
  • Strengthen cross-cutting BDS for tourism sector

Improved human resources capabilities in tourism sector

  • Strengthen vocational training and workforce development systems for tourism
  • Support industry-standard SICCS certification and seal for tourism
  • Help employers offer work-based learning opportunities for technical and managerial positions

3. Entrepreneurship Services

Support networks and ecosystems promote entrepreneurship

  • Develop and implement road maps to strengthen local ecosystems with local stakeholders
  • Connect ecosystems with regional and international networks
  • Stimulate local competitions and learning events to model successful entrepreneurial examples

Digitalisation and scaling of ICT solutions

  • Strengthen ICT providers to develop market-based solutions for MSME profiles
  • Create directory and platforms to match supply and demand for ICT services
  • Incubate and accelerate ICT offers through complementary services

Strengthened business advisory support services

  • Transfer new business development methodologies to local service providers
  • Attract new incubation and acceleration providers to establish in Honduras
  • Cost share in advisory programmes for target profile enterprises in priority sectors

Increased access to seed, risk and impact investment capital

  • Support new product development and training of financial institutions in non-collateralised lending for MSMEs
  • Leverage guarantee and apex funds for FIs
  • Expand alternative sources of capital such as diaspora, business angels, impact funds etc.

4. Business enabling environment

Simplified permit and license administration

  • Improve property registry system including outsourcing property registration
  • Support national online registry Mi Empresa en Línea
  • Support the streamlining and re-engineering of SPHS processes
  • Reduce the time, number of procedures, associated costs and the discretionary application of rules regarding operating licenses

Pro-growth tax system established

  • Strengthen the case for moving to a consolidated single monthly payment (monotributo)
  • Shifting the focus of the tax administration system from collecting penalties to promoting economic growth
  • Connect tax system with other registries to eliminate redundant processes in business registering and licensing

Public-private dialogue and private sector advocacy strengthened

  • Strengthen capacity of chambers to establish an economic policy agenda, evaluate and design policy proposals
  • Facilitate broad-based consensus around priority policies
  • Technical assistance to strengthen sectoral associations and expand outreach

Investment in productive infrastructure and services

  • Support efforts to increase transparency and confidence by reforming and modernising procurement processes
  • Work with local municipalities and mancomunidades to prioritise infrastructure project-based feasibility studies

Reforms in BEE rules and norms support competitiveness and inclusion

  • Create a permanent working policy group through private sector chambers
  • Support chambers to draft new laws on priority topics such as tax administration, e-signatures and e-payments, insolvency, financial technology, the vocational training system, as well as a number of sector-specific laws

[uploaded August 2019]

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