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<h1 class="gmail-reader-title">US-Backed Coup Regimes Trapped
Honduras in Unpayable Odious Debt, Warns new President
Xiomara Castro</h1>
By Bejamin Norton – Feb 1, 2022</div>
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<p><strong>At the time of the 2009 US-backed coup,
Honduras had $2.48 billion in external debt. Now it
has $9.25 billion. New leftist President Xiomara
Castro says this odious debt is unpayable. It
already eats up 50% of the government budget.</strong></p>
<p>The new leftist administration in Honduras managed to
win November 2021 elections in a landslide and defeat
an authoritarian coup regime, but now it faces a huge
problem that will make it difficult to govern: odious
debt.</p>
<p>When a US-sponsored military coup overthrew Honduras’
democratically elected left-wing President Manuel
Zelaya in 2009, the country had $2.48 billion in
external debt.</p>
<p>By the end of 2021, after 12 years of rule by corrupt
right-wing coup regimes, Honduras’ external debt had
swelled to $9.25 billion – a 373% increase.</p>
<p>The Honduran state’s internal debt to private parties
likewise skyrocketed from approximately $810 million
in 2009 to roughly $7.3 billion today.</p>
<p>Honduras’ GDP is only $23.8 billion, yet the country
is saddled with more than $16.5 billion in debt –
meaning its debt is nearly 70% of the size of its
entire economy.</p>
<p>The Central American nation’s new leftist President
Xiomara Castro, Honduras’ first democratic leader
since the coup, has said this burden on the government
is a form of odious debt, and is simply unpayable.</p>
<p>Castro declared in a speech at her inauguration on
January 27 that the previous coup regimes had
“submerged” the state in debt, leaving it in
“bankruptcy” in an “economic catastrophe.”</p>
<p>Debt payments now eat up a staggering 50% of the
government’s budget, Castro stressed.</p>
<p>This graph from <a
href="https://www.laprensa.hn/premium/deuda-odiosa-nuevo-gobierno-honduras-xiomara-castro-EB5322633"
moz-do-not-send="true">Honduran media outlet La
Prensa</a> shows how the debt skyrocketed after the
US-backed coup.</p>
<img
src="https://i0.wp.com/multipolarista.com/wp-content/uploads/2022/01/Honduras-external-debt-graph.png?resize=880%2C462&ssl=1"
alt="Honduras external debt graph"
style="margin-right: 25px;" moz-do-not-send="true"
width="417" height="219">A graph of Honduras’ external
debt
<p>This graph does not include Honduras’ massive
internal debt.</p>
<p>“After 12 years of dictatorship the amount of
internal debt increased from 20 billion lempiras (USD
$810 million) to 179 billion lempiras (USD $7.3
billion),” Castro said in <a
href="https://www.elheraldo.hn/csp/mediapool/sites/dt.common.streams.StreamServer.cls?STREAMOID=fkp98EKEEbXH5pxM1neHK6aAJ_I4YTPrsH_w1iAJhcWu1aTiad54r1BzT8mOTc8TMy9ESXbVnj7vAs51Em1ji4dXYht$$1M7CmxsH2al$Qxx784MzalFL68CeR_oEp8EEruZhZc33bdVlquv9hiXTvH_WdzOPOFakr0csr$3lt_IbZ8PJNrJTQD_S2M9e4ifLzlLswjQ7I7SUGhgDw$Ydqz4TnICSOdq27jddi9B5FiQtC1aPTmD0L_56tDG8D_EtvgwKQ_wtgwu$Juo6lg_UTQrkF3bZhnI9dbApfELFiLlTdU5rDKHMZQ5qyDFYs9pHDcjzHnkjqn_sxMcrUIet1tGJxidt81qKZHpzHnRbBceqX_mguCnH7cNoNS5FsAONdbPwes833WrH7ocGSf2SMZMHxQsDJm_WPz6Swe1HZkTT_5e8GNq_yWUAIs2vpWEsRQiba3KakF56rUXCLuwiKCsJ8qb4XcOFh9ai$eiZx7$wICo$XEMAWhICARxLqRJ&CONTENTTYPE=application/pdf&CONTENTDISPOSITION=Discurso%20toma%20se%20posesi%C3%B3n%20Xiomara%20Castro.pdf"
moz-do-not-send="true">her inauguration speech</a>.</p>
<p>“With these figures it is clear that the state does
not have the capacity to sustain the outrageous and
shameful debt that we are inheriting,” the new
Honduran president added. “It is practically
impossible to meet the debt requirements.”</p>
<p>Castro said the only way to manage the debt is to
renegotiate it with the creditors.</p>
<p>“My government will not continue the vortex of
plunder that has condemned generations of youth to pay
the debt they took on behind their backs,” she
declared.</p>
<p>“The country should know what they did with the money
and where are the $20 billion that they took out in
loans.”</p>
<p>The new Honduran president warned that this “plunder”
caused poverty to increase by 74%, “turning us into
the poorest country in Latin America.”</p>
<p>“This statistic itself explains the [migrant] caravan
of thousands of people looking for opportunities,” she
said.</p>
<p><a
href="https://orinocotribune.com/honduras-back-after-12-years/"
target="_blank" rel="noopener"
moz-do-not-send="true">RELATED CONTENT: Honduras:
Back After 12 Years</a></p>
<p><strong>Debt traps ensnare Argentina, Puerto Rico,
Greece<br>
</strong>Other countries in Latin America have been
caught in these same kinds of debt traps.</p>
<p>In 2018, Argentina’s right-wing President Mauricio
Macri took the <a
href="https://www.theguardian.com/world/2018/sep/26/argentina-imf-biggest-loan"
moz-do-not-send="true">largest loan in the history
of the International Monetary Fund</a> (IMF): $57.1
billion.</p>
<p>This enormous debt incurred by Macri pushed the
subsequent center-left government of President Alberto
Fernández into a debt spiral that has made it very
difficult to spend on social programs.</p>
<p>The IMF, which is dominated by the United States, and
is used as an <a
href="https://multipolarista.com/2021/10/19/super-imperialism-michael-hudson/"
moz-do-not-send="true">economic weapon to advance
Washington’s foreign-policy agenda</a>, has often
trapped Global South nations in unpayable debt.</p>
<p>The IMF uses this debt as leverage to force countries
to sell off their natural resources, privatize
state-owned enterprises, slash social spending, and
cut labor protections that challenge the interests of
foreign corporations.</p>
<p>Puerto Rico, a US colony, also suffers from <a
href="https://academicworks.cuny.edu/clr/vol19/iss2/5/"
moz-do-not-send="true">painful odious debt</a>. The
US government used this debt burden to impose an
unelected Financial Oversight and Management Board
that controls Puerto Rico’s spending, and has <a
href="https://www.youtube.com/watch?v=Nd8wRpVxTeU"
moz-do-not-send="true">imposed devastating austerity
measures</a> on the Puerto Rican people.</p>
<p>Even Greece, a member of the European Union, has
similarly been crushed under the weight of odious
debt. While <a
href="https://www.forbes.com/sites/niallmccarthy/2015/03/13/contrary-to-what-most-people-think-greeks-work-the-longest-hours-in-europe-infographic/?sh=1fb06ae2983d"
moz-do-not-send="true">Greeks work the most hours in
Europe</a>, economics experts have said the
country’s <a
href="https://www.forbes.com/sites/stevekeen/2015/07/18/wolfgang-schauble-the-trust-troll/?sh=42fc13a6407b"
moz-do-not-send="true">debt is impossible to pay off</a>.</p>
<br>
<div id="gmail-mab-2958990933">
<p><span> <br>
</span> </p>
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<p> </p>
<h5> <span> Ben Norton </span> </h5>
<div>
<p>Ben Norton is a journalist and writer. He is a
reporter for The Grayzone, and the producer of
the Moderate Rebels podcast, which he co-hosts
with Max Blumenthal. His website is
BenNorton.com, and he tweets at @BenjaminNorton.</p>
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