| Abstract: This is the first Country Assistance Strategy (CAS) to be prepared for Honduras since completion of the country ' s Poverty Reduction Strategy Paper (PRSP) in October 2001. Through its basis in the PRSP ' s six pillars (accelerating equitable and sustainable growth, reducing rural poverty, reducing urban poverty, investing in human capital, strengthening social protection for specific groups, and guaranteeing sustainability) this CAS builds on the accomplishments of the previous one, but lays greater emphasis on addressing long-standing structural barriers to inclusive growth (including trade enhancement, competition policy, financial sector reform, property rights, urban and rural employment and governance improvements). It also continues to support human development efforts and improved environmental management. In tandem with IDA, IFC and MIGA will support the implementation of Honduras ' PRSP, with a particular focus on accelerating equitable and sustainable growth. IFC ' s priorities in Honduras over the CAS period will include: (a) supporting growth of export-oriented small and medium enterprises (SMEs) (b) supporting internationally competitive firms with inadequate long-term capital access (c) helping to strengthen the business environment (through technical assistance) and (d) supporting the financial sector. The strategy faces a number of important risks with respect to potential for macroeconomic instability, political and social hurdles to policy reform and weak institutional capacity. These risks appear to be manageable, in light of Government ' s demonstrated commitment to addressing them with the support of Honduran stakeholders and external partners. |
