Customs Union between Guatemala and Honduras Strengthened

The Central American Bank for Economic Integration (CABEI) approved US$1.5 million in non-reimbursable technical cooperation to activate the Customs Union process between Guatemala and Honduras through its Program "Support to the Deep Integration Process to promote the free transit of persons and goods between Guatemala and Honduras."

CABEI Director for Guatemala Mr. Emmanuel Seidner stated that this will be the first Customs Union in the Americas and will cover an area of 221,381 square kilometers (50% of the Central American territory) and serve a population of 24.8 million inhabitants (60% of the Central American population), which will benefit from more streamlined and lower cost trade that will result in better consumer prices.

It is expected that the project will increase transportation speeds from 16 to 30 kilometers per hour. The project also involves an expansion of infrastructure and logistical corridors, as well as an additional 1% GDP increase per year for both countries.

CABEI expects that the customs union between the two countries will further the establishment of adequate physical and organizational structures to deepen the regional integration process and, thus, facilitate the circulation of people and goods.

The Bank has established regional integration as a strategic axis of its 2015-2019 Institutional Strategy, which includes contributing to the strengthening of trade inside and outside of Central America among its guidelines.