The country has been on the cusp of bankruptcy for several years, and though a group of banks had written off $3.5 billion of debt in 2007 accumulated debt since then has reached $5 billion. The economic plight has contributed to crises within the government, with no consensus on how to formulate a budget for 2013.
These practical difficulties have had real effects on the country’s telecommunications market. Fixed-line teledensity at only 7% is significantly lower than the Latin American and Caribbean average.
Poor fixed-line infrastructure has been exacerbated by low investment and difficulties in local terrain which have made investment in rural areas unattractive or uneconomical. As a consequence, the internet has been slow to develop in Honduras: DSL and cable modem technologies are available but relatively expensive, while higher speed services are largely restricted to the major urban centres.