weighted score 3.7 · ten dimensions
Sourcing Attractiveness Index · ten dimensions
Honduras
Labour cost, supply base depth, logistics infrastructure, trade access, and innovation scores for Honduras as a sourcing destination.
Labour cost competitiveness
8
Cheapest manufacturing labour in Central America. Maquila minimum wages well below regional peers. Highly cost-competitive for garment assembly and light manufacturing.
Supply base depth
3
Narrow supply base concentrated in garments, coffee, palm oil, and wire harnesses. Limited domestic raw material processing. Most inputs for maquila operations are imported.
Logistics & infrastructure
3
Puerto Cortés is a regional standout but inland road infrastructure is poor. Limited rail. Domestic logistics add cost and time outside the San Pedro Sula corridor.
Workforce skills
3
Basic assembly skills available in maquila zones. Technical and engineering talent pool is small. English proficiency limited outside export-oriented garment and call centre sectors.
Scalability
7
Maquila zones have demonstrated ability to absorb volume growth in garments and wire harnesses. Labour availability supports expansion in labour-intensive categories.
Ease of doing business
3
Bureaucratic complexity, weak rule of law, and security concerns create friction. Gang influence on business operations is a documented risk in some regions.
Trade access & tariffs
2
EU-CA Association Agreement provides preferential access. US-CAFTA-DR in force. However, limited product diversification means trade access benefits are concentrated in a few sectors.
Sustainability baseline
2
Environmental regulation enforcement is weak. Deforestation linked to palm oil expansion. Climate vulnerability is high — Hurricane Eta/Iota (2020) devastated infrastructure and agricultural zones.
Innovation & IP
3
Minimal R&D investment. No significant patent activity. Innovation capacity limited to process improvements in maquila operations rather than product development.
Quality standards
3
Garment and wire harness factories serving US brands operate to buyer-imposed quality systems. Outside export-oriented sectors, quality management is inconsistent. Third-party audit infrastructure is limited.
Labour & Cost Competitiveness
Labour & Cost Competitiveness
- Wage level
- Honduras offers the cheapest manufacturing labour in Central America. Minimum wages in maquila sectors are well below USD 300/month, making it highly cost-competitive for garment assembly and light manufacturing against regional peers such as Guatemala and El Salvador.
- Workforce & population
- Population of approximately 10 million provides a modest but sufficient labour pool for labour-intensive manufacturing. Young demographics support continued workforce availability, though emigration to the US reduces effective supply.
- Key export sectors
- Coffee (one of the world's top 10 producers), palm oil, garments (maquiladoras in San Pedro Sula corridor), and wire harness assembly for automotive. These sectors drive the bulk of export earnings and employment.
Trade Access & Infrastructure
Trade Access & Infrastructure
- EU-CA Association Agreement
- Honduras benefits from the EU-Central America Association Agreement, providing preferential tariff access for key exports including coffee, textiles, and processed agricultural goods into the EU market.
- Port infrastructure
- Puerto Cortés is Central America's largest and most efficient port, with modern container handling and direct shipping lines to the US East Coast and Europe. It significantly reduces transit times compared to other Central American origins.
- Maquila framework
- Honduras operates free trade zones (ZIP) and temporary import regimes (RIT) that allow duty-free import of raw materials for re-export. The maquiladora sector — concentrated around San Pedro Sula — is the backbone of the garment and light assembly export economy.