ILO EESE assessment triggers drastic reduction of business registration cost in Honduras

Based on an ILO assessment of the business enabling environment in Honduras and successful advocacy efforts of the Confederation of Honduran Employers the Parliament of Honduras approved last year a piece of legislation drastically reducing the cost of registering a new enterprise. The ILO estimated that the elimination of the mandatory use of notarial services when registering a new enterprise should lead to a yearly reduction of registration cost of USD 5 Mio and give an incentive to several thousand informal businesses to formalize. Based on latest business registration data from 2014 this is what seems to happen now. The data show an encouraging 15% increase in the number of new enterprises registered in the Central region of Honduras. They also show an 81% increase in the number of non-fixed assets that were registered to serve as business guarantees to be used as collateral for loans. The latter is a good indicator of a more optimistic outlook of enterprises. Besides positive externalities like the growth of the US economy the ambitious business environment reform program implemented since late 2013 has played a major role.