Honduras Approves Financial Relief Law for Farmers

Honduras's Ministry of Agriculture and Livestock (SAG) has backed a new financial relief law passed by the National Congress. This initiative aims to help thousands of farmers by allowing them to refinance their debts, offering a crucial lifeline amid economic and climate-related hardships.

SAG Minister Moisés Molina explained that the law emerged from farmer requests for debt forgiveness, a measure deemed unfeasible. Instead, the ministry, in dialogue with agricultural organizations and independent producers, developed a refinancing plan. Key stakeholders like the National Federation of Farmers and Ranchers of Honduras (FENAGH), the National Agricultural Development Bank (Banadesa), and the National Congress's Agriculture Commission were involved in reaching a consensus.

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This decree contemplates the possibility of restoring the bankability of many producers. It gives the opportunity to renegotiate debts with the bank, readjust them and refinance them over a period of 15 years.

The new legislation enables producers to renegotiate their debts with banks, restructuring them over a 15-year period. Farmers cultivating basic grains will benefit from preferential interest rates as low as 2.5%. Molina highlighted that this measure is designed to encourage domestic food production, particularly for those facing severe challenges from climate events, high input costs, and fuel prices.

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Many producers can reincorporate into production, at a time when the sector is being severely punished by the climate, the cost of inputs and the price of fuels.