Honduras

Money & costs

Costs

Honduras is an inexpensive country overall, but a trip here can be pricey simply because of the activities you’re likely to do, namely diving.

Besides diving, lodging will likely be your biggest expense. Hotel prices run the gamut in Honduras, the majority being high-budget or low-midrange, around US$15 to US$25 per night. Budget travelers can manage lodging for under US$12 per day in popular destinations and under US$8 in remote areas, though the cheapest hotels can be pretty grim.

For most travelers, eating out will cost around US$6 to US$8 per person per meal, once drinks, taxes, and tip are added in. But you can save money by eating at street food vendors and no-name eateries, and by getting lunch or breakfast items at a grocery store instead of a restaurant. Being careful, budget travelers can bring food costs down to US$5 per meal or less.

The big-ticket item for most travelers here is diving, plus the higher cost of hotels and restaurants on the Bay Islands. Figure an Open Water course will cost US$200 to US$240. with a half-dozen fun dives at around US$20 to US$35 per tank. Lodging and food tend to be more expensive on Roatán than Utila. Most shops on Utila have basic dorms, and offer their students either two to four free nights or two free fun dives (most people choose the latter). A trip to La Moskitia can also be pricey, whether by tour or on your own.

Buses are a bargain, especially considering how big the country is. There are three classes of service: ordinario or parando (literally, stopping) is the classic ‘chicken bus’ that stops frequently to pick up and drop off passengers. Directos make fewer stops and cost only slightly more – for most travelers this is the way to go. Some popular routes are covered by the luxury or deluxe lines Hedman Alas, King Quality or Saenz Clase Primera. Prices are double or triple, but it can be a worthwhile splurge.

Taxis are safe and affordable, with fares typically charged per person. Expect US$0.60 to US$1 per person within town, US$1.50 and up for destinations out of town or at night.

Other costs to consider are rental cars (midsize US$30 to US$60 per day including taxes and insurance), Internet (US$0.75 to US$1 per hour) and laundry (US$1 per pound).

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Tipping

A 10% tip is customary for tour guides and restaurant waiters, but not taxi drivers. At hotels, it is nice to tip someone for carrying your bags to your room, and the housecleaning staff – US$1to US$2 per day is fair; you should pay more at higher-end hotels or for especially good service.

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Economy

Honduras is one of the poorest countries in the Western Hemisphere, along with Haiti, Nicaragua, Guyana, and Bolivia. Nearly two-thirds of Hondurans live in poverty – and 45% in extreme poverty – and the unemployment rate hovers at 28%. Honduras’ GDP is US$7.5 billion; with a population of seven million, its per capita GDP is just over US$1000.

Like many developing countries, Honduras is saddled with enormous foreign debt, around US$5.6 billion. It was one of only seven countries outside of sub-Saharan Africa to qualify for the Heavily Indebted Poor Countries (HIPC) Initiative, which went into effect for Honduras in July 2006. Yet the HIPC relief amounts to only US$1.3 billion and Honduras will continue to face some US$370 million in annual debt servicing.

The Honduran economy was for many years almost entirely dependent on coffee and banana exports, and controlled by Standard and United Fruit Companies. Those companies – now Dole and Chiquita, respectively – still exert powerful economic and political leverage, but the economy as a whole has significantly diversified in the last two decades. Honduras has also expanded its nontraditional exports, such as shrimp and melons, and promoted tourism. Maquilas, which import US yarn and fabric and turn them into clothing for export, now employ 130, 000 Hondurans, mostly around San Pedro Sula and Puerto Cortes. Remittances from abroad total some US$1.4 billion per year, or 15% of the country’s foreign exchange.

The controversial Central America and Dominican Republic Free Trade Agreement (CAFTA-DR) went into effect in Honduras in April 2006. The agreement will lower tariffs and trade barriers for scores of goods, services, agricultural products and investments; supporters say it will stimulate the economies of Central American countries while critics say multinational corporations will squeeze out small businesses. CAFTA also includes safeguards for labor rights and environmental protection – it remains to be seen if it will help to end illegal pine and mahogany logging in Honduras or accelerate it, as some predict.

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Money

The local currency is the lempira and it’s considered to be relatively stable. For exchange rates see the inside front cover of this book. Also, consider checking out www.oanda.com, a website that generates handy currency conversion cheat-sheets, which you can print out and keep in your wallet for easy conversions.

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ATMs

Cash machines are prevalent throughout the country. ATMs operated by BAC/Credomatic, Banco Atlántida, and Unibanc are the most reliable, and most likely to accept out-of-country debit cards. Always be alert to your surroundings when withdrawing cash; whenever possible, take out money during the day, and at a machine that’s in a lockable cabin (to get in, you typically have to swipe your ATM card at the door) or inside the bank itself. ATMs typically spit out 500-lempira bills, which can be a hassle to break – get in the habit of using big bills at hotels and larger restaurants, and saving the small bills for taxis, small eateries, street stands, etc.

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Cash

Banks in larger cities usually exchange US dollars, and occasionally euros; bring your passport and go in the morning. Your hotel may let you pay in US dollars, or exchange them for you.

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Credit cards

Visa and MasterCard are widely accepted, including at major supermarkets, retail stores, hotels and car rental agencies. Expect a 6% to 12% surcharge.

Cash advances on Visa cards are available at most banks, including BAC/Credomatic, Banco Atlántida and Banco de Occidente. BAC/Credomatic can usually process advances on MasterCard too. There’s typically no transaction charge on the Honduran end for Visa or MasterCard cash advances, but of course the interest rates tend to be astronomical.

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Moneychangers

Freelance moneychangers can be found – in fact, they’ll find you – in the airports and in parque central in San Pedro Sula. It’s not recommended you use them unless the banks are closed or the line is out the door (which is often the case). There are moneychangers at all border crossings, too; they are equally suspect, but using them is the best way to get rid of Guatemalan quetzales or Nicaraguan córdobas if you know you won’t need them anymore (El Salvador uses the US dollar).

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Traveler’s checks

American Express traveler’s checks can be changed in all major towns; Banco Atlántida and BAC/Credomatic are the best banks to use. They will need your passport, and may charge a commission. Some banks only change traveler’s checks and foreign cash in the morning.

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