Responses to the Coup d'etat in Honduras on Sunday June 28, with special emphasis on producing English-language versions of commentaries by Honduran scholars and editorial writers and addressing the confusion encouraged by lack of basic knowledge about Honduras.
Saturday, October 24, 2009
Bad Economy Getting Worse
At the same time, the bonds that were used to finance the 2006 and 2008 budget, totaling $2,000 million lempiras came due without the de facto government having any means to pay them. They got Congress to pull their chesnuts out of the fire and extend the term of those bonds for another 2-3 years, or about the same time as this year's bonds come due. This will be during the administration of the next president, severely constraining him financially.
Several newspapers are reporting about an attempt to reprice gasoline in the country. When Manuel Zelaya assumed the Presidency, one of his accomplishments was to redo the way the retail price of gasoline was determined. This brought down the price of gasoline around 6 lempiras per gallon (around $0.32) in part by changing the source and consequently reducing the transport costs. US supplier monopolies were broken up (Chevron) in favor of Petrocaribe. Ever since the coup, the Micheletti regime has said that its suppliers (surprise, its Chevron again) are prepared to guarantee the necessary supply to the de facto government. Now we learn the price; return to the old pricing method which increases profits for the gas station owners.
Finally, Gabriela Nuñez, the de facto government's Finance Minister, the one who has lied multiple times about the FMI drawing rights and having been invited by Gordon Brown to London, says the government has money to actually pay its employees for October. It seems employees aren't being paid on schedule. Every month the de facto government has been late with payments. "This government has guaranteed the pay of all public employees until the last day that it corresponds to president Roberto Micheletti to direct the destiny of this country," she asserted. However, it seems there's a cash flow problem (see debt sales above) such that they can only pay some workers in any given week. They've instituted a committee to see what the income is for any given week, and who they can pay that week. So it might be a while before everyone receives their October paycheck. She places the October obligation at around $1,500 million lempiras.
But don't worry government employees, even if your pay is late, Gabriela, who never lies, says your pay is assured, and your pension fund has invested in bonds issued by this illegitimate government to pay you now, bonds the next legitimate government may choose to ignore. An illegitimate government after all, cannot make contracts binding on the next government. Buyers of the bonds assume all the associated risk.