THROUGHOUT ITS HISTORY, Honduras has been an underdeveloped area. Its rugged topography and lack of good ports on the Pacific coast have combined to keep it relatively isolated from the mainstream of social and economic development. The capital, Tegucigalpa, is located high in the central mountains, removed from the isthmus's main north-south transportation routes.

The rugged topography and semi-isolation have provided Honduras some advantages as well as disadvantages. Unlike the neighboring republics of El Salvador and Guatemala, Honduras did not produce a totally dominant landholding oligarchy. It also escaped the turmoil over transisthmian transit routes that plagued Nicaragua and Panama. Finally, Honduras, alone among Central America's republics, is not dominated by a single city. The isolation of the capital led to the rise of San Pedro Sula in the twentieth century as the nation's commercial and industrial center.

However, lack of development produced, for much of Honduras's history, relatively weak social and political institutions. Much of the nation's history has been marked by long periods of political instability, frequent military coups, and considerable government corruption and inefficiency. External powers have consistently exploited and aggravated these problems. Neighboring Central American nations have repeatedly intervened in Honduran internal affairs, giving Hondurans a strong fear of foreign attack. Countries outside the region also have manipulated Honduran politics from time to time to suit their own national interests. During the first half of the twentieth century, the Honduran economy was so dominated by the United Fruit Company and the Standard Fruit Company that company managers were frequently perceived as exercising as much power as the Honduran president. Increased nationalism and economic diversification have changed this situation in recent decades, but in the early 1990s, Honduras remained a nation highly sensitive to and dependent on external forces. Despite both national and international efforts, Honduras remained poor and vulnerable. In the 1980s, security concerns centered on the Nicaraguan border; in the early 1990s, concern centered on El Salvador because of its insurgency problems and its boundary dispute with Honduras.

Both a product and a victim of its past, in the mid-1990s, Honduras was striving to find some means of gaining the benefits of modernization while avoiding the violent conflicts that wracked its neighbors in the 1980s.

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Source: U.S. Library of Congress