Decree 8-2022

This decree declares a fiscal and financial emergency in Honduras for 2022-2023, authorizing the Government to obtain up to US$2 billion in domestic or foreign loans to pay debt and finance social programs such as energy subsidies, fuel, and education. It establishes a debt ceiling of 55% of GDP to restore the balance of public finances.

Whereas, in accordance with Article 245 Attribution 9) of the Constitution of the Republic of Honduras, the President of the Republic has the authority to "Participate in the formation of laws by presenting bills to the National Congress through the Secretaries of State".

Whereas, in accordance with Article 245, attributions 2), 20) and 30) of the Constitution of the Republic of Honduras, the President of the Republic is responsible for the General Administration of the State and has the authority to: "Direct the general policy of the State and represent it; decree extraordinary measures in economic and financial matters when the national interest so requires; Direct the economic and financial policy of the State and the other powers conferred upon him by the Constitution and the Laws".

Whereas, the current Government of the Republic corresponding to the period 2022-2026, upon beginning its management of the State Administration, found deteriorated public finances, without sufficient financial resources to cover all pending payment obligations, due to the low availability of funds in the General Treasury of the Republic (TGR); having barely sufficient availability for the payment of salaries and wages.

Whereas, the Public Treasury has been devastated by the previous State Administration, leaving it highly indebted, with a public debt balance of US$15,679.2 Million in 2021 (equivalent to L.381,716.4 Million); while poverty increased from fifty-eight percent (58%) in 2009 to seventy-four percent (74%) in 2021.

Whereas, the General Budget of Income and Expenditures of the Republic for Fiscal Year 2022, contained in Decree No. 107-2021 of December 10, 2021, does not incorporate all expenses that impact Public Finances, which prevents adequate planning and execution of Government programs and projects; likewise, this instrument presents a series of inconsistencies, which reflects lack of transparency by not specifying all expenses and obligations of the State, such as: The total public debt service (in 2022 approximately L.3,500.0 million in interest and debt commissions); Floating debt (accounts payable) of the Central Government; Floating debt (accounts payable) of the National Electric Power Company (ENEE); Expenses and Debt of the Municipalities; Fiscal Contingencies; Project investments through Public-Private Partnerships (PPP); and trusts are not all included in the budget (Vehicle Registry Trust), together with the management of resources in separate special accounts; additionally, the debt of the trusts is not recorded as part of the public debt.

Whereas, the projection of tax revenues is insufficient to cover budgeted expenditures, because based on the current State budget for the year 2022, 102.2% of tax revenues will be used in the payment of salaries and wages and debt service (Amortization, commissions and interest), and to meet the payment of the remainder of obligations and expenses (Investment, medicines, subsidies, transfers to Municipalities, universities, etc.), extraordinary measures must be adopted and recourse must be made to borrowing.

Whereas, there exists a series of current transfer expense items in the budget without Beneficiary without TRF and other non-profit associations (NGOs), a situation that reflects the need to adopt measures that allow the current authorities to regularize the budget execution and reallocate budget items transparently.

Whereas, subsequent to the approval of the General Budget of Income and Expenditures of the Republic for Fiscal Year 2022, a series of legislative and executive Decrees were approved both in the Executive Branch and in the National Congress, which increase spending on salaries and wages such as: Decree PCM-130-2021, ratified through Legislative Decree No. 108-2021, Legislative Decree No. 100-2021 teachers of the Honduran Community Education Program (PROHECO), which grant permanent position agreements with recognition of their seniority, which have an adverse impact on the salary mass, without having provided for their financing.

Whereas, the available balance in the General Treasury of the Republic at the close of 2021 was significantly lower compared to previous years. Therefore, it is evident that poor practices have been used in the use of resources, and likewise the principle of the single cash account is not being complied with.

Whereas, the Government has among its alternatives to honor its obligations, requesting loans from the Central Bank of Honduras (BCH), a public institution, for which in the case of Special Drawing Rights, approval of an Emergency Decree is required in accordance with Article 40 of the Law of the Central Bank of Honduras, and in order to obtain the best financial conditions, recourse is had to this to request loans that allow honoring obligations in this transition phase while implementing mechanisms for the refinancing of Public Sector debt, as part of economic measures to meet State obligations.

Whereas, by virtue of the fiscal and financial crisis that the State is experiencing, it is necessary for the current Government to adopt a series of urgent measures with the objective of restoring balance within public finances; in order to address basic needs contained within the Government's Social Program, within which are found the full subsidy of energy for all families that consume up to 150 kilowatt hours; reduction in the price of gallons of fuel; free tuition, school meals and biosecurity measures; technology bonus; subsidies for liquefied petroleum gas (LPG); repair of educational centers; reconstruction of public infrastructure affected by the phenomena of ETA and IOTA, job generation projects and others priority for the population and thereby stimulate investment and reduce poverty, which it is intended to achieve, among other measures, through the approval of this Decree.

Whereas, in accordance with Article 205 Attribution 1) of the Constitution of the Republic, it is the power of the National Congress to: Create, decree, interpret, reform and repeal laws.

Whereas, on the eighth of April of the year two thousand fourteen, through Legislative Decree No. 335-2013, published in the Official Gazette "La Gaceta" under No. 33,403 dated April 11, 2014, the Law for the Strengthening of Shrimp Farming is created, whose purpose is to establish a set of regulations aimed at strengthening the farmed shrimp industry in its different stages, in order to increase its competitiveness, so that it continues to be a sector of broad contributions to national economy and development.

Whereas, through Executive Agreement No. 768-2014 dated the twenty-second of August of the year two thousand fourteen, published in the Official Gazette "La Gaceta" under No. 33,528 dated September tenth of that same year, it is agreed to approve the Regulation of the Law for the Strengthening of Shrimp Farming, which in its article 5, 1 subsection f, establishes that it is the responsibility of the Secretary of State in the Offices of Agriculture and Livestock (SAG): "Issue a Ministerial Agreement that instructs the General Prosecutor of the Republic to execute a Lease Contract or concession or its respective renewal", whose common procedure and procedural moment is broken down in Article 56 of the aforementioned legal instrument.

Whereas, the Executive Branch through the Secretary of State in the Offices of Agriculture and Livestock (SAG), is the superior authority in matters of fishing and...