Because economic competitiveness plays a vital role in drawing foreign investment, the region of Central America now recognizes Honduras as its most business-friendly nation due to its ranking in the 2025 Global Business Complexity Index (GBCI). The TMF Group, a leading international firm specializing in regulatory and corporate compliance, performed a yearly assessment of 79 countries worldwide, which ranked Honduras at 66th position, showing greater business ease compared to its regional competitors.
Honduras achieved a higher ranking than Costa Rica, which received 58 points and Nicaragua, which received 50 points, in Central America. The report demonstrates how Honduras has streamlined its commercial procedures and developed a stable business climate to make it a business-friendly country in Central America.
Regional Ranking Reflects Structural Reforms
Economists and academic experts believe that Honduras’ rise in the rankings resulted from specific improvements in its regulatory and business environment. University economist Professor Wilfredo Girón praised the government for establishing an improved business climate for entrepreneurs.
“We are on the right path. Despite my tendency to point out what needs improvement, today I see commendable efforts that merit positive recognition,” Girón stated during a recent media interview.
Girón emphasized that Honduras has become a more business-friendly country in Central America because of its enhanced transparency measures alongside the simplification of bureaucratic procedures and the advancement of digital government services. The updates represent comprehensive policy reforms, which emerge from joint efforts between government entities and private organizations to upgrade the country’s economic framework.
Advances in Digitalization Fuel Business Creation
Honduras achieved its reputation for being business-friendly in Central America through fast-paced business process digitalization. The GBCI reports that the government has successfully launched online business registration systems and virtual platforms for tax compliance and licensing.
Business founders can now establish companies and handle permits and regulatory filings through online processes, which remove many lengthy steps that previously discouraged local and international business initiatives. The recent developments have decreased waiting periods, while reducing face-to-face interactions with government staff and enhancing transparency.
The country has progressed in implementing fintech and e-government platforms, which serve to support more small and medium-sized enterprises that form an important part of Honduras’ private sector. The shift to virtual procedures modernizes the commercial sector while ensuring alignment with international corporate governance and compliance standards.
Foreign Investment Still Faces Obstacles
Local business leaders emphasize that numerous obstacles persist, even though the country has gained international recognition as a business-friendly country in Central America. As a regional manager in the maquiladora industry, Guillermo Matamoros warned that international praises can hide actual conditions on the ground.
Matamoros emphasized that technical evaluation must be coupled with genuine investor incentives to create an effective environment.
Matamoros recognized business facilitation progress yet highlighted the necessity of sustained investor trust, which relies on legal certainty along with consistent regulations and a competitive tax environment. According to his perspective, Honduras needs to develop an all-encompassing strategy with legal refinements, fiscal reform, and infrastructure upgrades rather than focusing solely on simplifying administrative processes.
Honduras needs to solve ongoing issues regarding the judicial system’s independence and corruption to secure its status as Central America’s top choice for business operations. It is essential to maintain these elements so that businesses, and particularly foreign-owned enterprises, can operate with confidence in their investments.
The current focus rests on Legal Certainty paired with Fiscal Policy
The private sector identifies weak legal frameworks as a significant problem. The stability of business contracts, along with intellectual property rights and labor laws, frequently suffers from political manipulation and instability. To draw high-value foreign direct investment (FDI), a country must ensure its legal environment remains predictable.
The demand for tax reform is steadily increasing in volume. International experts deem Honduras’ existing tax framework less competitive, when compared with neighboring countries’ systems. The excessive tax burdens combined with unclear incentive structures prevent investors from reinvesting their capital and creating new jobs.
The Honduran Council of Private Enterprise (COHEP) supports reforms that simplify the tax code, while pushing for investment incentives and improved public-private sector communication. This reform agenda would improve Honduras’ image as a business-friendly country in Central America and make it more attractive to long-term investors.
The status of Honduras within Central America and its global economic position
Despite Honduras ranking 66th among 79 countries worldwide, which may appear unremarkable, the position shows considerable prominence within Central American rankings. This improved placement shows a rising trend, which indicates increasing international trust in the nation’s economic management.
Nations with lower scores on the GBCI index usually feature uncomplicated regulatory systems, together with clear tax structures and strong digital services. Honduras needs to adopt effective practices from top-performing nations such as Singapore, Denmark, and New Zealand to advance its position within international rankings.
The business environment gap between Honduras and Costa Rica stands out as a clear indicator among Central American nations. Costa Rica, which receives praise for its democratic institutions and sustainability achievements, has recently fallen behind in terms of business simplicity. The current trend has the potential to transform investment patterns across the region and generate fresh trade and manufacturing dynamics.
Strategic Sectors Driving Business Growth
The Honduran government has pinpointed multiple sectors that can achieve high growth when the business climate improves.
- Textile and Apparel Manufacturing: The textile manufacturing sector in Honduras stands as a regional leader in maquila exports because of its favorable access to the U.S. market through the CAFTA-DR agreement.
- Renewable Energy: The development of solar energy and wind power projects receives support from international financial sources and changes in domestic energy policies.
- Agroindustry: Honduras exports agricultural products such as coffee and bananas and seafood products like shrimp while establishing value-added operations in food processing and packaging.
- Tourism: Sustainable tourism initiatives drive the promotion of the Bay Islands and Mayan archaeological sites.
Honduras can establish itself as a favorable destination for business in Central America by strengthening its sector regulations and increasing protections for international investors.
Workforce and Infrastructure: Dual Priorities
Site selection and business expansion decisions in Honduras need to evaluate both skilled labor availability and reliable infrastructure quality. The growing workforce in the country remains underutilized because educational and technical training deficiencies continue to affect productivity.
Government bodies and educational institutions, along with vocational institutes, are forming stronger collaborative relationships to resolve this issue. Skill development programs focused on English language proficiency and digital literacy, alongside trade-specific skills, continue to grow mainly in manufacturing areas.
Investments in transportation and logistics infrastructure development show increasing momentum. Infrastructure projects that include road modernization, together with port expansions in Puerto Cortés and enhanced customs facilities at border crossings, aim to boost supply chain efficiency. Investments in Honduras help preserve its status as a business-friendly country in Central America.
The Road Ahead: Consolidating Gains
Honduras needs to sustain its current progress to maintain its long-term competitive edge. Experts point out that consistent public policy, together with enhanced investor protections and transparent governance practices, are fundamental to maintaining the achievements recognized in the Global Business Complexity Index.
The country has the chance to establish itself as Central America’s most business-friendly nation, but reaching this goal needs ongoing political dedication and multisectoral cooperation with definite reform commitments. Honduras can draw increased investment and create jobs while establishing a foundation for inclusive and sustainable economic development by tackling the report’s detailed challenges and opportunities.