In an era where technology increasingly dictates economic and social development, artificial intelligence (AI) has emerged as a powerful force driving innovation and reshaping industries worldwide. As countries around the globe embrace AI to enhance productivity, improve services, and create new business opportunities, Latin America has begun to make significant strides in the AI domain. Three Latin American countries are at the forefront of this technological revolution: Chile, Brazil, and Uruguay. Through a combination of strategic investments, a strong emphasis on education, and a focus on developing human talent, these nations are positioning themselves as regional leaders in AI and setting a global example for how AI can be leveraged to drive economic growth, address societal challenges, and close technological gaps.

According to the Latin American Artificial Intelligence Index (ILIA), a framework designed to assess AI progress in the region, Chile, Brazil, and Uruguay stand out as the leading countries in Latin America, thanks to their unwavering commitment to fostering innovation in the AI field. Key factors contributing to their success include:

• Developing robust technological ecosystems,
• Training a highly skilled workforce,
• Implementing public policies that promote innovation and digital transformation.

Investment in Infrastructure and Education: Building the Foundations for AI Growth

One of the driving forces behind the success of Chile, Brazil, and Uruguay in AI is their substantial investment in technological infrastructure. A cornerstone of AI development is access to high-speed internet, data storage, and processing power. In Brazil, for instance, the government has allocated significant resources to build advanced data centers and establish a nationwide 5G network. The implementation of 5G is crucial for the development of AI, as it enables faster data transmission and supports the deployment of AI-powered services across various industries, including healthcare, logistics, and agriculture.

Conversely, Chile has focused on fostering collaborations between universities, research institutions, and the private sector. These collaborations promote research and development (R&D) in AI technologies and help build a competitive innovation ecosystem. In particular, Chile has worked on integrating AI solutions into sectors such as mining, where AI-powered systems are used to optimize resource extraction processes, and healthcare, where AI is harnessed to improve patient care and medical diagnostics. The government established the Artificial Intelligence Hub in 2020, a key initiative to accelerate AI adoption and talent development.

Uruguay has similarly invested in technology infrastructure, but its focus has been ensuring that AI is accessible to all. The country is committed to digital inclusion, with programs like Plan Ceibal, providing students with digital tools nationwide. This initiative helps people from all walks of life become familiar with technology and gain essential skills for the digital age. By integrating technology training early on, Uruguay prepares future generations to lead and thrive in an AI-driven world.

Education has been another vital factor in the success of these three countries in the AI space. High-quality education systems play a central role in building a workforce that is not only capable of creating AI technologies but also adept at applying these technologies to solve real-world problems. In Brazil, numerous universities are at the forefront of AI research, with institutions like the University of São Paulo (USP) and the Federal University of Pernambuco (UFPE) producing many scientific papers related to AI. Brazil also boasts a growing network of research centers collaborating with global tech giants like Google, IBM, and Microsoft to develop scalable AI solutions.

Meanwhile, Chile has invested heavily in its higher education system, with universities like the Pontifical Catholic University of Chile (PUC) leading the way in AI education and research. The country has also built strong international partnerships with academic institutions in the United States and Europe to exchange knowledge, foster collaboration, and co-develop cutting-edge AI technologies.

Uruguay’s commitment to education is evident in its innovative approach to digital literacy. With the support of international organizations such as the United Nations and the World Bank, Uruguay has expanded its educational infrastructure to include more computer access, internet connectivity, and AI-related training programs. This focus on education ensures that Uruguay’s youth will have the skills and knowledge necessary to compete in an AI-driven economy.

The Economic, Technological, and Social Impact of AI in Latin America

Chile, Brazil, and Uruguay’s efforts to advance AI are already yielding impressive results, with tangible benefits across several sectors. These countries leverage AI to boost productivity, reduce costs, and drive economic growth. At the same time, they are fostering social development through digital inclusion and job creation.

Economic Impact

AI has proven to be a game-changer in various industries in Latin America, particularly in traditional sectors such as agriculture, mining, and manufacturing. In Brazil, the agribusiness sector has seen notable improvements in efficiency thanks to AI-powered solutions. Using machine learning algorithms to optimize planting, irrigation, and harvesting, Brazilian farmers can increase crop yields while reducing resource usage, such as water and fertilizers. AI has also been used to monitor crops for disease outbreaks, helping farmers take proactive measures to prevent losses. As a result, Brazil has become a leading exporter of soybeans, coffee, and other agricultural products, with AI playing a central role in improving productivity.

Chile has also leveraged AI in its mining industry, a critical sector of the country’s economy. AI-based systems are being used to optimize resource extraction processes, minimize environmental impact, and improve worker safety. AI is also helping Chile improve its logistics infrastructure, particularly at its busy ports, where AI algorithms are used to reduce waiting times, optimize cargo handling, and increase overall operational efficiency. This has allowed Chile to enhance its position as a key player in global trade, particularly in exporting copper and other natural resources.

In Uruguay, AI is helping small and medium-sized enterprises (SMEs) become more competitive by providing tools that optimize business operations, reduce costs, and increase profitability. Startups like Tryolabs are leading the way in AI-powered solutions for retail, finance, and healthcare industries. As these companies grow and attract international investment, Uruguay’s economy benefits from creating high-tech jobs and the influx of foreign capital.

Technological Impact

The rise of AI in Latin America has also had a profound technological impact, particularly regarding the growth of AI-focused startups and the development of cutting-edge technologies. In Chile, the number of AI-driven tech startups has surged recently, with companies specializing in medical diagnostics, renewable energy, and smart cities. This growth in AI-driven innovation is transforming the business landscape and fostering greater regional collaboration. For example, Chilean startups are working alongside companies from Argentina, Brazil, and Uruguay to develop AI solutions that can be applied across the entire Latin American region, addressing common challenges such as healthcare access and transportation inefficiencies.

In Uruguay, AI-based companies like Tryolabs are helping to build a thriving ecosystem of machine learning and AI talent. By attracting international clients and investors, these startups contribute to the country’s growing reputation as a hub for tech innovation in Latin America.

Social Impact

Beyond its economic and technological impacts, AI has a positive social impact in these countries. Uruguay’s digital inclusion initiatives have provided marginalized communities with access to the skills and tools necessary to participate in the digital economy. Similarly, Chile’s AI Hub and Brazil’s AI research centers are working to ensure that the benefits of AI are distributed equitably across the population, especially in underserved sectors like healthcare and education.

Conclusion: The Path Forward for AI in Latin America

In conclusion, Chile, Brazil, and Uruguay have set a remarkable example for the rest of Latin America and the world in harnessing AI’s power to drive growth, improve quality of life, and foster innovation. Through strategic investments in technology infrastructure, a commitment to quality education, and the development of human talent, these countries are positioning themselves as leaders in the global AI race. Their continued focus on AI will undoubtedly shape the future of the digital economy in Latin America, driving economic growth and improving the social and technological landscape for years to come. The success of these nations serves as a blueprint for other countries in the region, showing that with the right combination of public policy, investment, and innovation, AI can be a powerful tool for reshaping the future of Latin America.

Julio Moltó, the Minister of Commerce and Industries of Panama, recently emphasized the country’s continued appeal as an investment hub, especially in industries like technology and semiconductors. In an interview, Moltó discussed Panama’s ongoing economic development, the impact of strategic alliances such as MERCOSUR, and the growth fostered under the Special Regime for Multinational Enterprises in Panama (SEM). This special regime continues to draw foreign investment, promoting economic diversification and a favorable environment for multinational corporations.

MERCOSUR: A Golden Opportunity for Panama

In less than six months, Panama became an associate state of MERCOSUR. This significant development offers Panama strategic advantages in accessing the southern markets of Latin America. Moltó underscored that this integration places Panama in a prime position to leverage its benefits, particularly in logistics, trade, and investment. “MERCOSUR represents taking advantage of Panama’s strengths, such as its excellent port infrastructure, the Panama Canal, and its advanced air transportation network,” said Moltó.

This alliance is set to bolster Panama’s logistics and business center role, providing seamless connections to markets in Brazil, Argentina, Paraguay, and Uruguay, among others. This integration opens doors to new investments, especially in sectors such as logistics and ports, with the Special Regime for Multinational Enterprises in Panama as a catalyst for attracting multinational corporations interested in expanding into South America. Panama’s geographic position, robust infrastructure, and favorable business environment make it an ideal gateway to the rest of the continent.

Economic Reactivation and Pending Projects

One key component of Panama’s economic reactivation strategy has been the government’s focus on resurrecting important projects abandoned by previous administrations. Under the leadership of President José Raúl Mulino, Panama has launched several programs aimed at reinvigorating its economy through infrastructure projects. These include the long-awaited refurbishment of the Mariano Gula Stadium in Colón and various projects focused on improving healthcare and education infrastructure.

Moltó outlined that the government has identified 33 key projects critical to Panama’s economic recovery. Fourteen projects have already been announced; the remainder will be unveiled in the coming weeks. These efforts are designed to boost the economy and create significant employment opportunities. According to the minister, the ongoing projects will generate approximately 10,000 jobs, helping to stimulate economic activity across multiple sectors.

Moltó also highlighted the ongoing work to bolster sectors such as agriculture. He cited efforts to support the dairy and meat industries, which are expanding rapidly and exploring new export opportunities. This holistic approach to economic development, combining infrastructure investments and sector-specific growth, positions Panama for sustained growth in the coming years.

Special Regime for Multinational Enterprises (SEM)

An essential pillar of Panama’s economic strategy is the Special Regime for Multinational Enterprises in Panama (SEM). In 2024, this regime facilitated the entry of 12 new companies, attracting an impressive $24 million in foreign investment and creating 132 new jobs. Moltó emphasized that the SEM continues to play a vital role in Panama’s efforts to diversify its economy and enhance its competitiveness on the global stage.

The SEM is beautiful to multinational companies due to its tax incentives, simplified regulatory processes, and access to Panama’s highly skilled workforce. Companies in high-tech sectors, including semiconductor production, are increasingly drawn to Panama under this regime, benefiting from the country’s strategic location, stable economy, and modern infrastructure. According to Moltó, “Panama remains a highly attractive hub for foreign investment, particularly in emerging sectors such as technology, semiconductors, and logistics.”

In addition to the SEM, Panama offers other favorable investment regimes, including the free trade zones, which saw considerable investment in 2024. These zones attracted $163 million in investments, further solidifying Panama’s position as a key destination for international business.

Simplification of Procedures and Bureaucratic Reduction

A major initiative under the current government has been streamlining business processes and reducing bureaucratic inefficiencies. Moltó discussed the Ministry of Commerce and Industries’ ongoing work with the National Authority for Government Innovation (AIG) to implement digital platforms that allow businesses to communicate directly with government agencies, reducing delays and unnecessary administrative hurdles.

The goal is to create a more business-friendly environment, encouraging more foreign investment. Moltó noted that the government is focused on making it easier for investors to navigate the regulatory landscape in Panama, which could ultimately enhance the country’s appeal as a destination for multinational enterprises under the SEM. By fostering a more efficient regulatory environment, Panama hopes to position itself as the regional leader in attracting businesses looking to expand into Latin America.

The Future of Panama as an Air and Logistics Hub

Panama’s future as a significant logistics and air transport hub is also a central theme of Moltó’s economic vision. The country’s vast land availability, strategic location, and infrastructure assets, such as the Panama Canal and Tocumen International Airport, make it a prime candidate for becoming a critical node in the global supply chain. With continued investment in infrastructure and air transport capabilities, Panama’s major logistics hub role will likely grow in the coming years.

Moltó expressed optimism about the country’s potential to attract major international air transport companies. “The airport director is doing a great job, and in the coming weeks, we will participate in an event with major airlines. Our mission is to attract them to Panama to generate jobs,” he said. By expanding its role as an international air hub, Panama aims to create thousands of new jobs while strengthening its position as a key logistics and trade center for global and regional commerce.

Conclusion

In conclusion, Panama’s economic strategy is centered around leveraging its strategic location, robust infrastructure, and business-friendly regimes like the Special Regime for Multinational Enterprises in Panama. The SEM continues to attract foreign investment, especially in sectors like technology and logistics, creating new jobs and further diversifying the economy. Panama’s inclusion in MERCOSUR, its economic reactivation initiatives, and ongoing improvements in business processes underscore its commitment to becoming a leading hub for multinational companies in Latin America. Through these efforts, Panama positions itself as a key player in the global economy, offering a dynamic and attractive environment for business investment.

Nestlé has long been recognized as a global food and beverage leader, continuously innovating and adapting to the ever-evolving marketplace. As part of its commitment to embracing the future of technology and improving operational efficiencies, the company has recently inaugurated its new Data Analysis and Artificial Intelligence Center (CADIA) in Guatemala. With an initial investment of over US$5 million and creating more than 1,500 direct and indirect jobs, CADIA marks a significant milestone in Nestlé’s ongoing expansion in the region. This new center reflects the company’s broader digital transformation strategy, reinforcing its existing investments in Guatemala, exceeding US$85 million over the past five years.

The Inauguration of the Nestlé AI Center in Guatemala

The opening of CADIA, which took place on February 25, 2025, was heralded as a game-changing moment for Nestlé and the local economy. Patricio Astolfi, General Director of Nestlé Guatemala, spoke about the transformative potential of this artificial intelligence initiative. “This artificial intelligence center represents an evolution in how Nestlé operates in Guatemala,” Astolfi said during the inauguration. “It will allow us to make more precise and efficient decisions, strengthen our relationship with customers and suppliers, and optimize the consumer experience.” By integrating advanced AI technologies, Nestlé is positioning itself to enhance its operational management and drive innovation in its supply chain, marketing, and customer relations.

The Facilities and Technologies Behind the AI Center in Guatemala

Located in the heart of Guatemala City, Zone 12, CADIA spans an impressive 1,952 square meters. It was specifically designed to meet the demands of modern data analysis and machine learning. It will serve as a hub for optimizing marketing, distribution, and inventory management processes across the company’s operations in the region. The new facility is equipped with cutting-edge technologies such as machine learning, image recognition, and predictive modeling tools, allowing the company to understand consumer behavior better, anticipate trends, and optimize logistics and inventory planning. This technological infrastructure will also enable Nestlé to make real-time data-driven decisions, leading to faster and more informed responses to market shifts and customer needs.

AI Center in Guatemala: A Catalyst for Digital Transformation

Nestlé’s CADIA is part of a larger global initiative to digitally transform every link in the company’s value chain, from production to final consumption. The center’s advanced capabilities will allow the company to adapt quickly to market demands, customize its commercial strategies, and refine its supply chain logistics to ensure greater efficiency and responsiveness. These data-driven strategies will improve key aspects of Nestlé’s operations, including forecasting, production planning, and the optimization of stock levels. With access to more granular data and sophisticated analytical tools, Nestlé is poised to improve its customer response time significantly, increase the speed of product delivery, and enhance overall supply chain performance.

Impact of the AI Center in Guatemala on Local and Regional Economies

This focus on artificial intelligence and data analytics also positions Guatemala as a leader in integrating cutting-edge technology in the food and beverage sector. The creation of CADIA highlights the country’s growing role in digital innovation and boosts its emerging tech industry. The presence of this state-of-the-art AI center also underscores the country’s attractiveness as a destination for foreign investment. By establishing such an advanced facility, Nestlé reinforces its position in the Central American market and contributes to developing local talent and expertise in artificial intelligence, data science, and technology.

Training and Talent Development at the AI Center in Guatemala

In addition to creating jobs, the center offers valuable training opportunities for local professionals, allowing them to work with leading-edge technology and collaborate with global experts in the AI and data analytics fields. As part of Nestlé’s commitment to talent development in the region, the company is also working closely with local educational institutions to nurture future leaders in digital innovation and to promote STEM (Science, Technology, Engineering, and Mathematics) education in Guatemala.

Sustainability and Innovation at the AI Center in Guatemala

Nestlé’s AI center is a testament to its continued investment in Guatemala and reflects its broader sustainability, efficiency, and innovation goals. As part of its global sustainability strategy, Nestlé has significantly reduced its environmental footprint by leveraging digital technologies. The adoption of AI tools at CADIA will contribute to the company’s goal of minimizing waste, optimizing energy consumption, and reducing carbon emissions throughout its supply chain.

The AI Center in Guatemala: A Key Driver for Economic Growth

During the inauguration ceremony, various key figures, including Guatemala’s President Bernardo Arévalo, recognized CADIA’s positive impact on the local economy. “I congratulate Nestlé and thank them for continuing to believe in this country of vast opportunities,” President Arévalo remarked. “Without a doubt, this investment represents a key driver for our economy.” He highlighted the role of private sector investments in driving economic growth and creating new employment opportunities, particularly in emerging fields like artificial intelligence and technology. In attendance were several prominent figures, including Gabriela García, the Minister of Economy; Cristian Mayorga, Executive Director of the Chamber of Commerce of Guatemala; Raúl Bouscayrol, President of the Chamber of Industry of Guatemala; and Roger Denzer, Ambassador of the Swiss Confederation. Their presence at the inauguration further underscored the significance of this project for Nestlé and Guatemala’s economy as a whole. Collaboration between the public and private sectors is essential for fostering an environment that is conducive to innovation and long-term economic growth.

Global Implications and Future Prospects for the AI Center in Guatemala

Pablo Wiechers, CEO of Nestlé Central America, also emphasized the importance of this new development. “This initiative responds to Nestlé’s global strategy to digitally transform every link in its value chain, from production to the final consumer,” he said. Wiechers noted that the new AI center will help Nestlé maintain its competitive edge in an increasingly complex market by providing enhanced insights into consumer preferences, market trends, and operational efficiencies.

Nestlé’s AI Center in Guatemala is expected to be a cornerstone of the company’s digital transformation efforts in the region and globally. The center will serve as a testing ground for new AI-driven solutions, many of which could be scaled and implemented across Nestlé’s operations in other countries. With its strategic location, state-of-the-art technology, and commitment to innovation, CADIA is set to become a key enabler of Nestlé’s growth and success in the years to come.

Conclusion: AI Center in Guatemala as a Catalyst for Long-Term Success

In conclusion, Nestlé’s investment in its new AI center in Guatemala is a forward-thinking decision that promises to transform the company’s operations, strengthen its relationships with customers and suppliers, and contribute to the country’s economic development. As the company continues to invest in technology and innovation, the benefits of AI will be felt not only within Nestlé but also throughout the broader economy, positioning Guatemala as a leader in adopting artificial intelligence in the food and beverage industry.

In recent years, franchise expansion in Latin America has experienced significant growth, driven by various factors that have transformed the business landscape. With its diverse economies and expanding middle class, the region has become an increasingly attractive market for national and international brands. As the demand for quality services and products grows, franchise models are proving to be a key driver of investment and business growth across the continent. Brazil and Mexico, the region’s powerhouses, continue dominating the sector, but Argentina’s recent economic recovery adds a new layer of excitement and opportunity for franchise investors.

Brazil and Mexico: The Powerhouses in the Franchise Sector

Brazil has long been the leader in franchise expansion in Latin America, and this dominance shows no signs of slowing down. The country’s large population, growing consumer spending, and diversified economy make it an attractive destination for franchises. Sectors like food, retail, beauty, and education have grown significantly in recent years. According to the Brazilian Franchise Association (ABF), the sector grew by an impressive 14% in 2023, signaling a positive outlook for the industry. One of the key drivers behind this expansion is the increasing adoption of digital tools, including omnichannel strategies that blend physical and online retail experiences. Brands in Brazil are embracing digitalization, integrating digital sales platforms, and enhancing their operations to improve efficiency and customer satisfaction.

Not to be outdone, Mexico is also witnessing a surge in franchise expansion. The country’s growing economy, improved infrastructure, and favorable business environment make it an ideal location for franchises to thrive. Mexico has seen notable growth in industries like technology, health, and tourism, with national and international brands looking to establish a presence. Economic reforms and a wave of foreign investment have created a favorable climate for the franchise sector. As the second-largest economy in Latin America, Mexico’s diverse population and robust consumer demand continue to fuel the growth of franchises. Mexico has become a hotbed for franchise development, with increasing interest in innovative business models, particularly those that cater to the digital and health sectors.

Argentina’s Comeback: A Renewed Interest in Franchising

While Brazil and Mexico have maintained their positions as the leading players in franchise expansion in Latin America, Argentina is quickly reemerging as a promising market for franchises. Argentina faced significant economic challenges for several years, including high inflation rates, currency devaluation, and political instability, which hindered foreign investment and franchise growth. However, the country has shown signs of economic recovery in recent years. Thanks to a series of economic reforms and a more stable business environment, Argentina is once again becoming an attractive destination for international brands looking to expand in the region.

The food sector, in particular, has seen a resurgence in franchise expansion. With local and global brands investing in the market, Argentina’s vibrant food culture and growing demand for dining out fuel this growth. The Argentine Franchise Federation (FAF) reported a 10% increase in new franchise openings in 2023, a strong indicator of renewed confidence in the country’s economy. This recovery is also supported by the growing number of Argentine consumers seeking reliable and quality brands in a market that has faced economic volatility.

International brands, particularly in the food and beverage sector, are taking advantage of Argentina’s current economic climate, establishing their presence in key cities like Buenos Aires, Cordoba, and Rosario. This renewed interest in franchise expansion in Argentina signals that the country’s economy may be on the right track, with both foreign and domestic investors confident in the country’s potential for long-term growth.

Trends Shaping Franchise Expansion in Latin America

Several key trends influencing local and international franchise models shape the franchise landscape in Latin America. One of the most prominent trends is the rise of digitalization. Integrating digital platforms and online sales channels is necessary in today’s competitive business environment. Franchise systems increasingly adopt e-commerce strategies and digital tools to streamline operations, engage customers, and offer more convenient services. For instance, many regional food franchises now offer delivery and takeout services through mobile apps and third-party platforms, making it easier for customers to access their products.

Moreover, integrating technology in managing operations and tracking customer preferences is helping franchises expand their reach. Operational management software enables franchisees to monitor inventory, manage supply chains, and handle customer relations more effectively. This digital shift empowers franchises to enhance customer experiences, improve efficiency, and boost profitability.

However, despite the opportunities, challenges remain. While experiencing economic growth, Latin American countries still face hurdles such as inflation, fluctuating exchange rates, and bureaucratic red tape, which can create obstacles for franchises. In countries like Argentina, inflation remains a concern, and fluctuations in the currency exchange rate can impact profitability and investment decisions. While these challenges are significant, franchises’ ability to innovate and adapt to these economic realities is helping them thrive in the region.

The Future of Franchise Expansion in Latin America

As franchise expansion in Latin America continues to evolve, it is clear that the region’s economic landscape offers both challenges and opportunities. Brazil and Mexico will likely continue to lead the charge with their strong economies, diverse populations, and growing demand for products and services. However, Argentina’s economic recovery provides a unique opportunity for franchises to tap into a market showing renewed potential. The growth of the franchise sector in Argentina will depend on continued economic stability, favorable investment policies, and a sustained focus on consumer-driven business models.

Franchise brands’ key to success in Latin America will be their ability to adapt to changing consumer behaviors, leverage digital technologies, and navigate the region’s economic challenges. With careful planning, strategic investments, and the right market approach, the potential for growth in the Latin American franchise sector remains strong.

In conclusion, franchise expansion in Latin America is poised for continued growth, with Brazil and Mexico leading the way while Argentina shows signs of revival. The franchise sector’s resilience, adaptability, and embrace of new technologies ensure that Latin America remains an attractive destination for investors and brands looking to tap into a dynamic and growing market. The future looks bright for franchises in Latin America, and businesses that can navigate the region’s unique challenges will be well-positioned to succeed.

An economic slowdown in Honduras in 2024 led to fewer private, commercial, residential, and industrial constructions in cities like Choloma, Villanueva, and Tegucigalpa compared to 2023. Although new businesses and private constructions always emerge in these developing municipalities, the number of projects decreased compared to 2023. Experts point out that despite reducing the number of projects, the investments being made, especially in the Sula Valley, are more costly and require much more money and time.

San Pedro Sula’s Growth in Private Construction

San Pedro Sula, one of the major cities in Honduras, saw a 10.5% growth in private developments. In relation to 2023, there was a 10.5% increase in private construction in San Pedro Sula last year. Last year, 556 new constructions emerged, including 23 industrial warehouses, nine shopping centers and office buildings, 36 commercial centers and supermarkets, 38 commercial businesses, six gas stations and service stations, a church, 421 residential projects, 14 apartment buildings, and eight service buildings.

Project Forecasts for 2025

In 2025, 54 projects are being evaluated for approval in Honduras’ cities. Of these, 47 projects are residential, including houses and condominium towers. “Given the trend in recent years, most construction license applications are expected to focus on family and multifamily housing (including condominiums), as well as the construction of more shopping centers and warehouses,” municipal authorities stated.

Construction Permits in the Central District

The Central District, including Tegucigalpa and Comayagüela, registered 287 fewer constructions in 2024 than in 2023. In 2024, 1,903 construction permits were issued in cities in Honduras, with an investment of 10,300,000,000.00 lempiras. Of the 1,903 projects, 1,465 are single-family homes, 148 commercial premises, 43 office buildings, 37 multifamily buildings, 86 warehouses, 52 roadworks, 47 commercial preliminary projects, four urbanizations, and 21 change of use. In the previous year, 656 projects were pending approval, most of them applications for single-family homes.

Future Construction Growth Expectations

A 30% increase in construction permits is expected by 2025, mainly due to new financing policies established by the central government, which include extended deadlines and lower annual interest rates. “There is an expected growth in apartment projects, which have proven to be a viable option for vertical housing in Tegucigalpa and Comayagüela,” said municipal authorities. With the launch of the new San José dam, urban areas are expected to grow in the area leading to Olancho. Commercial projects will continue to develop as they have been, primarily in the city’s outskirts, in the southern part of the municipality.

Choloma’s Growth in the Residential Sector

Choloma, the most industrialized city in Honduras, is growing in the residential sector with new urban projects and independent house constructions. In 2024, the city council approved the construction of over 400 houses, renovations, fence constructions, extensions, and more than 10 apartments, 10 commercial premises, industrial warehouses, a supermarket, a hardware store, and a gas station. The total revenue from these construction permits in cities in Honduras was 10,090,533.40 lempiras in 2024, a significant increase compared to 6,985,894.09 lempiras in 2023.

Villanueva’s Construction Growth

Villanueva approved 264 construction permits in 2024, with a total income of 9,370,875.12 lempiras. The list includes the construction of 94 houses, 19 annexes, 71 fences/walls, four terraces, 15 commercial premises, five warehouses, 26 apartments, one church, six rooms, six logistics offices, and four manufacturing plants. The city council reported that 147 permits had been issued by June 2023, amounting to more than 3,780,149.91 lempiras.

Economic Slowdown and Challenges for the Industrial Sector

There has been an economic slowdown across several cities in Honduras. Raúl Martínez, a real estate expert, asserted there has been a slowdown in commercial and industrial development in the country. “In the industrial sector, free zones are not growing. There are available spaces in the free zones for companies, especially in the last two years when several companies left the country, which has created availability in industrial parks,” he said. The high land cost in San Pedro Sula and the limited availability in Tegucigalpa restrict their development.

Outlook for Office and Apartment Buildings

However, office and apartment buildings will continue to emerge, particularly in the Industrial Capital. However, Martínez highlights that more than half of them do not yet have permits, meaning they are still in planning or under intention. Martínez pointed out that construction revolves around remittances, which is why many municipalities that previously had little development have been seeing significant growth in recent years.

Private Construction Growth in 2024

According to the results of the Survey on Private Roofed Construction Works (ECOPT) by the Central Bank of Honduras (BCH), during the third quarter of 2024, private construction reached a total of 640.6 thousand square meters, representing an increase of 10.6% (61.6 thousand square meters) compared to the same period in 2023. Within private construction in cities in Honduras, residential buildings remain the primary destination, contributing 54.6% to the total square meters built. Vertical buildings, mainly apartments, stand out, with a 172.6% growth in the third quarter of 2024 compared to the same period in the previous year.

Fewer Projects, More Expensive Construction

“Fewer projects but more expensive,” says Gustavo Boquín, president of the Honduran Chamber of the Construction Industry (Chico). He stated that although fewer projects were built in 2023, higher-value works and additional square meters have emerged, as shown in the ECOPT results. “Right now, in the Sula Valley, no massive urbanizations are being built, but rather apartment towers,” he noted. In 2024, around 18,000 homes were not built in Honduras due to delays in the disbursement of funds from Banhprovi. Only 12,000 houses were erected. Boquín explained that the entire government budget was not executed either, impacting construction.