Attachment 1. a USAID_Honduras CDCS Public Version_CLEAN.pdf

UNCLASSIFIED

Table of Contents

ACRONYM LIST 2

I. EXECUTIVE SUMMARY 4

II. COUNTRY CONTEXT 9

III. STRATEGIC APPROACH 15

IV. RESULTS FRAMEWORK NARRATIVE 20

A. GOAL STATEMENT AND NARRATIVE 20

B. DEVELOPMENT OBJECTIVE RESULTS STATEMENTS AND NARRATIVES 21

Development Objective 1 21 Socio-economic Opportunities Improved to Reduce Irregular Migration Development Objective 2 26 Democratic Governance to Meet Citizens’ Needs Enhanced to Reduce Irregular Migration Development Objective 3 29 Justice and Security Improved to Reduce Irregular Migration

V. MONITORING, EVALUATION AND COLLABORATING, LEARNING, AND ADAPTING 34

VI. ANNEXES 36

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ACRONYM LIST

BEE Business Enabling Environment

CBP U.S. Customs and Border Protection

CDCS Country Development Cooperation Strategy

CLA Collaborating, Learning, and Adapting

DFC U.S. International Development Finance Corporation

DO Development Objective

FSR Financing Self-Reliance

FTF Feed the Future

GBV

GOH

Gender-Based Violence

Government of Honduras

GDP Gross Domestic Product

ICT Information and Communication Technology

IR Intermediate Result

J2SR Journey to Self-Reliance

LAC Latin America and the Caribbean

LAPOP Latin American Public Opinion Project

LGBTI Lesbian, Gay, Bisexual, Transgender, and Intersex

LMIC Low and Middle Income Country

ME and CLA Monitoring, Evaluation, and Collaborating, Learning, and Adapting

MESCLA Monitoring and Evaluation Support for Collaboration, Learning, and Adapting

MSME Micro-, Small-, and Medium-Sized Enterprise

NPI New Partnerships Initiative

OGP Open Government Partnership

PEG Government Strategic Plan 2018-2022 (Spanish Acronym)

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PMP Performance Management Plan

PSE Private Sector Engagement

U.S. United States

USAID United States Agency for International Development

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I. EXECUTIVE SUMMARY

GOAL STATEMENT AND WHAT MISSION EXPECTS TO ACHIEVE

USAID/Honduras’s goal for its new Country Development Cooperation Strategy (CDCS) is “A more prosperous, democratic, and secure Honduras where citizens, especially youth, are inspired to stay and invest in their future.” This goal is forward-looking, positive, and centers Hondurans in their own development. In addition, it is strongly aligned with the United States (U.S) Government priorities of security, prosperity, and governance under the Central America Strategy, the Journey to Self-Reliance (J2SR), and the Administration’s focus on reducing irregular migration from Honduras to the United States.

The following Development Objectives (DO) will contribute to achieving this goal: DO1) Socio-economic opportunities improved to reduce irregular migration; DO2) Democratic governance to meet citizens’ needs enhanced to reduce irregular migration; and, DO3) Justice and security improved to reduce irregular migration. These three DOs are all designed to address the multi-faceted, integrated drivers of irregular migration that also hold Honduras back on its J2SR.

COUNTRY ROADMAP ASSESSMENT

USAID/Honduras’s focus on increasing access to socio-economic opportunities, supporting open and accountable governance, and improving justice and security reflects the commitment and capacity challenges evident in Honduras’s Country Roadmap.

Open and Accountable Governance is among Honduras’s lowest scoring indicators. In1 addition, Honduras’s Safety and Security score is below average for other low- and middle-income countries (LMIC).

While Honduras’s score for Capacity of the Economy reflects relatively high government commitment around economic policy, Honduras continues to face persistently high levels of poverty and inequality, weakening terms of trade, and a reduced ease of doing business.2 3

While Gross Domestic Product (GDP) per capita has been steadily increasing over the past ten years, the gap between Honduras and other countries in Central America is widening, as is income inequality. With respect to Capacity of the Citizen, quality of education has been4 decreasing, and Honduras experiences high drop-out rates, unemployment, and rising underemployment.

Information and communication technology (ICT) adoption is of growing relevance during the COVID-19 pandemic, yet it is Honduras’s lowest score on any J2SR metric. While this is a challenge, collaborating to expand adoption of digital technologies is also an opportunity for USAID to work with the Government of Honduras (GOH) and the private sector to increase access to digital technologies for youth.

4 World Bank Databank, https://data.worldbank.org/indicator/SI.POV.GINI?locations=HN&view=chart.

3 World Bank Group. 2019. Economy Profile of Honduras Doing Business 2020, https://openknowledge.worldbank.org/handle/10986/32975.

2 World Bank Country Overview, Honduras, Last Modified 9 Oct 2020, https://www.worldbank.org/en/country/honduras/overview.

1 World Justice Project Indicators 2019, World Justice Open Government Index, https://worldjusticeproject.org/our-work/research-and-data/wjp-rule-law-index-2019.

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MISSION’S STRATEGIC CHOICES

USAID/Honduras has identified three areas of Strategic Focus that highlight how this CDCS differs from the previous CDCS. These areas of Strategic Focus are: 1) Facilitate systems change—social, economic, justice and security, environmental, education; 2) Partner and co-create with the private sector to capitalize on shared values, foster innovation, and facilitate joint investment where interests align; and, 3) Generate opportunities for citizens—especially youth—to actively engage and invest in their future in Honduras.

Under the first area of focus, USAID/Honduras will expand on and deepen a shift the Mission initiated in the last CDCS towards a systems change approach. For USAID/Honduras, a systems change approach means focusing on changes in the norms, behaviors, and structures which influence how the systems function and the results they produce. This strategic choice reinforces the shift to an integrated approach, which means the Mission will focus more intently on integrated programming, recognizing that the complex interdependent development challenges in Honduras require an integrated approach across DOs, Intermediate Results (IR) and activities to realize systemic change. In addition, the Mission is taking a facilitative approach to development under this CDCS, which for the purpose of this strategy, means the Mission will be increasing work with and through local actors—whether they be GOH, private sector, civil society, faith-based organizations, or communities—as co-creators and co-implementers where there is mutual interest and shared benefit.

Furthering a facilitative approach and relationships with development actors, USAID/Honduras will partner and co-create with the private sector and other stakeholders to capitalize on shared values, foster innovation, and facilitate joint investment where interests align. Furthermore, in order to move Honduras along its J2SR, USAID will redefine its partnerships with the public and private sectors, supporting them in achieving their stated mandates and fulfilling their bottom lines. By meeting partners where they are instead of insisting they meet USAID where it is, the Mission can hope to achieve greater locally-led development and sustainability.

USAID’s explicit focus on youth in this strategy is a shift from the previous CDCS, and is5 informed by an intentional focus on migration. Research shows that being a young person is the leading predictor of migration intentions, many of whom decide to attempt to migrate irregularly. Data from U.S. Customs and Border Protection (CBP) reveal that three out of four Honduran migrants apprehended at the U.S. southwest border are under age 30. Rather than viewing Honduras’s growing youth population as problematic, this CDCS identifies the country’s youth as a demographic and democratic dividend, representing opportunities for the country's economic growth, civic engagement, and more accountable and democratic governance. In order to take advantage of this youth dividend, USAID will increase opportunities for youth and participation of youth in democratic processes, and across USAID’s portfolio.

In addition to the three strategic areas of focus, USAID/Honduras is prioritizing the integration of anti-corruption throughout the CDCS. This was not a strategic priority initially identified, but represents a major shift from the prior CDCS to this new one; rather than isolating anti-corruption in one DO (which was added after a thorough Mid-Course Stocktaking exercise midway through the previous CDCS), the Mission is incorporating it throughout all three DOs, in

5 Youth are individuals between the ages of 10 and 29.

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addition to a DO focused on governance. The CDCS also reflects a more deliberate focus on engaging civil society, the private sector, and the GOH on addressing corruption, which affects all areas of Honduras’s development.

DEVELOPMENT OBJECTIVES

USAID’s work across the three DOs integrates these key strategic choices with and through local actors to address Honduras’s development challenges.

DO1 (Socio-economic opportunities improved to reduce irregular migration) contributes to the CDCS goal by supporting the private sector, GOH, and communities to improve socio-economic opportunities in the country to reduce irregular migration. This DO addresses6 one of the most salient drivers of irregular migration: lack of economic opportunities, a motivation for migrating cited by more than 90 percent of returned Honduran migrants. By tackling socio-economic opportunities broadly, DO1 goes beyond focusing on strictly economic outcomes to include educational opportunities, youth engagement in society, and reduced vulnerability to key socio-economic shocks, including environmental shocks.

DO2 (Democratic governance to meet citizens’ needs enhanced to reduce irregular migration) highlights the Mission’s plan to assist the GOH on its J2SR in the core areas of Open and Accountable Governance (Liberal Democracy and Open Government), Government Capacity, and Civil Society and Media. This DO is also a clear nod to USAID’s learning about the critical role of governance and service delivery in irregular migration. This DO explicitly addresses the challenges corruption poses to development and the future of Honduran youth, and demonstrates the centrality of democratic governance to achieving the CDCS goal.

DO3 (Justice and security improved to reduce irregular migration) addresses key elements of the security and justice system to reduce impunity and ensure equitable application of the law, procedural fairness, and protection of human rights for all. Included in this DO are interventions to ensure that women, youth, and members of other marginalized populations who are survivors of violence will be empowered to demand justice and receive support services.

Efforts under DO3 will strengthen individual, family, and community resilience to crime and violence, enabling Hondurans to engage safely, openly, and peacefully in democratic processes, and create and take advantage of productive, socio-economic opportunities, reducing the risk of irregular migration.

ALIGNMENT WITH HIGH LEVEL STRATEGIES

USAID/Honduras’s CDCS is aligned with the National Security Strategy’s objectives of reducing irregular migration, and reducing crime and corruption. It is also aligned with the State-USAID Joint Strategic Plan through its efforts to strengthen citizen-responsive governance, promote healthy, educated and productive populations, and increase partnerships with the private sector and civil society organizations. The CDCS also supports the U.S. Strategy for Central America’s focus on security, prosperity, and governance.

6 For the purposes of this CDCS, socio-economic is defined as “relating to or concerned with the interaction of social and economic factors.” The Mission’s view of socio-economic opportunity includes those related to employment, education, skills development and other pathways and resources which lead to a stronger, more secure economic future.

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The CDCS will contribute to América Crece by improving the overall investment climate to create new opportunities for U.S. and Honduran private sector actors to increase their investments in Honduras. Through strengthening capacity and commitment of public and private sector Honduran institutions, the Mission's work will improve enabling conditions for new business formation, growth, and investment.

The CDCS is also aligned with other USAID strategies, including the Global Food Security Strategy, USAID Education Policy, USAID Strategy on Democracy, Human Rights and Governance, USAID Gender Equality and Female Empowerment Policy, Indigenous People's Strategy, Youth and Development Policy, and Digital Strategy, among others, as well as conflict sensitivity and do no harm principles. According to the 2020 annual report from the U.S.

Commission on International Religious Freedom, Honduras is neither a Country of Particular Concern nor a Special Watch List country. Although social inclusion remains a prevalent issue affecting ethnic and racial groups and women, threats to religious freedom are minimal.

According to the 2020 Trafficking in Persons Report, Honduras is a Tier 2 country, meaning that it does not fully meet the Trafficking Victims Protection Act’s minimum standards, but is making significant efforts to bring itself into compliance with these standards. Under this CDCS, the Mission will work to address irregular migration, including by reintegrating returned migrants, strengthening justice and security institutions, and supporting vulnerable populations to help reduce trafficking in persons.

Furthermore, the CDCS takes into consideration the need to address the long-term impacts of COVID-19, and the importance of maintaining flexibility to incorporate health system strengthening into the Mission’s portfolio as needed. The CDCS also contemplates needs arising as a result of Hurricanes Eta and Iota and anticipated disaster recovery work, and recognizes the critical nature of resilience to future programming in Honduras.

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RESULTS FRAMEWORK GRAPHIC7

7 For a full, landscape view of the RF Diagram, please see Annex B.

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https://docs.google.com/document/d/16DEpX2IVa5ciCinGuzK_dBofgsGlwn-HWKJX4KXXI1M/edit?usp=sharing

II. COUNTRY CONTEXT

COUNTRY CONTEXT OVERVIEW

Irregular Migration. The number of Hondurans apprehended at the U.S. southwest border reached historic highs in Fiscal Year (FY) 2019, with more than 250,000 Honduran migrants apprehended. This marked a 230 percent increase in apprehensions over the previous year.8

While migration levels declined as quickly as they surged, recent trends and contextual factors in Honduras suggest that migration will likely increase again, especially given the worsening effects COVID-19 and the aftermath of Hurricanes Eta and Iota are having on drivers of irregular migration across the board.

High levels of migration have development implications for Honduras, including by entrenching poverty, despite short-term poverty alleviation associated with remittances. This is due to the9 loss of human capital, reduced incentives to work, increased exposure to violence against10 children left behind, and the “morality drain” associated with the loss of Honduran voices at11 home to fight against corruption.12

To better understand the drivers of irregular migration, USAID/Honduras conducted a series of analyses at the international, national, community, household and individual levels. Consistent across these analyses is the finding that drivers generally do not exist in discrete silos. Rather, they are interconnected and inextricably linked, and interviews with migrants confirm that motivations are mixed. Addressing one driver without understanding how it interacts with the13 others could result in short-sighted, myopic interventions.

There are also drivers that influence irregular migration that are beyond USAID/Honduras’s sphere of influence. These include family networks in the United States, the draw of the U.S.

economy, and changing border policies in the United States, Mexico, and Guatemala, among others. But even these external factors interact with the development-related drivers of irregular migration in Honduras, so the full picture is important when designing a strategic response.

The interconnectedness between drivers of irregular migration underpins the Mission’s systems change approach to development and its choice to implement an integrated strategy. Honduras faces several key development challenges that fuel irregular migration and that interact with external factors to form a “perfect storm.” These include the country’s growing youth population, limited socio-economic opportunities, environmental shocks—such as Hurricanes Eta and

13 Children on the Run, UNHCR, 2014.

12 Carling Jorgen, Erlend Paasche, and Melissa Siegel, “Finding Connections: the Nexus between Migration and Corruption” Migration Policy Institute, May 12, 2015, https://www.migrationpolicy.org/article/finding-connections-nexus-between-migration-and-corruption.

11 Government of Honduras, Sub-Secretariat of Security in Prevention, Secretariat of Security (2019) “Violence Against Children Survey”, Honduras 2017.

10 Ralph Chami, Ekkehard Ernst, Connel Fullenkamp, and Anne Oeking “Are Remittances Good for Labor Markets in LICs, MICs and Fragile States? Evidence from Cross-Country Data,” International Monetary Fund Working Paper, 2018.

9 Chami, Ralph, et al. “Is There a Remittance Trap? High levels of remittances can spark a vicious cycle of economic stagnation and dependence” International Monetary Fund, FINANCE & DEVELOPMENT, SEPTEMBER 2018, VOL.

55, NO. 3

8 U.S. Customs and Border Patrol. “U.S. Border Patrol Southwest Border Apprehensions by Sector Fiscal Year 2020”, https://www.cbp.gov/newsroom/stats/sw-border-migration/usbp-sw-border-apprehensions.

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Iota—and loss of biodiversity, persistently high levels of violence, pervasive extortion and corruption, and most recently, COVID-19.

Youth. Honduras’s growing demographic youth bulge strains the labor market, driving Hondurans to migrate irregularly and seek illegal pathways to financial resources, including through gang involvement, and drug trafficking. And the Honduran youth population (ages 15-29) will only continue growing through 2026, making this a critical challenge and14 opportunity over the course of this CDCS. The association between a large, growing youth population and increased migration is global. Among Hondurans apprehended at the U.S.15 southwest border between 2013 and 2019, three in four are young migrants (under age 30).

Further, analyses of Honduran migration intentions consistently reveal that being young is the single strongest predictor of having stronger migration intentions, even above economic or violence factors.16

Economy. The vast majority of migrants cite “economic reasons” as a primary motivation for leaving Honduras. In the case of returned Honduran migrants, the share is over 90 percent.

But “economic reasons” are about more than simple joblessness. As many as six in ten returned migrants in Central America had a job before attempting irregular migration. The17 economic troubles driving migration are not just employment, but also the kind of employment.

It takes good paying, formal jobs to inspire Hondurans to stay.

Unfortunately, even when jobs are available, Hondurans are often unprepared to fulfill them.

More than one in four youth ages 15-24 are youth not in employment, education or training, the highest rate in Central America. Further, nearly two-thirds of the population over age 15 does18 not have any secondary education and data from USAID programming indicates that many19 employers require a secondary education. The COVID-19 pandemic has struck the Honduran education system particularly hard. According to some estimates, almost half of the nation's two million students are at risk of dropping out because they lack access to technology for distance learning, among other issues. This is doubly concerning because USAID research also shows20 that additional years of schooling decrease Hondurans’ willingness to migrate irregularly, with particular reductions associated with completing secondary education.

These socio-economic challenges exist in a country that is among the most inequitable and impoverished in Latin America and the Caribbean. The country’s GDP per capita was just

20 Agencia Efe, “Unos 800.000 niños hondureños, en riesgo de abandonar sus estudios por la COVID”, 18 August 2020, https://www.efe.com/efe/america/sociedad/unos-800-000-ninos-hondurenos-en-riesgo-de-abandonar-sus-estudios-po r-la-covid/20000013-4322302.

19 Ibid.

18 State of the Nation Program, State of the Region. “Fifth State of the Region Report on Sustainable Human Development,” 2016.

17 Pan-American Development Foundation, Labor Reinsertion Study, 2020.

16 The Americas Barometer 2018, 2014 by the Latin American Public Opinion Project (LAPOP), Vanderbilt University www.LapopSurveys.org.

15 Michael Clemens and Jimmy Graham. “Three Facts You Haven’t Heard Much About Are Keys to Better Policy Toward Central America.” 2019, https://www.cgdev.org/blog/three-facts-you-havent-heard-much-about-are-keys-better-policy-toward-central-america.

14 UN Economic Commission for Latin America, CEPALSTAT, 2020, https://estadisticas.cepal.org/cepalstat/portada.html?idioma=english.

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$2,575 in 2019. Nearly half of the population lives in poverty and the percentage of people21 living in poverty in rural areas is higher than those living in poverty in urban areas (60 percent versus 38 percent). While the high levels of poverty in the country are critical to the country’s22 context, it should be noted that the economic link to migration is more closely related to unemployment, underemployment, and a pervasive lack of opportunities than poverty itself.

Environmental Shocks and Stressors. Further threats to Honduras’s development include persistent and unpredictable environmental shocks and stressors. Honduras is vulnerable to climate change due to its high exposure to climate-related hazards (hurricanes, tropical storms, floods, droughts, landslides) that devastate crops and critical infrastructure. For example, drought in western Honduras, as measured by satellite data on changing vegetation levels and rainfall levels, predicts increases in irregular migration to the United States, measured by apprehensions at the U.S. southwest border. Forest clearing and biodiversity loss play a key role in exacerbating water shortages and drought, and with more than 30 percent of the working population employed in the agricultural sector, the impact of drought on Honduran livelihoods23 is extensive. Other shocks, such as coffee rust and volatile global coffee prices only add to the factors driving migration. Because of the crop’s centrality to the Honduran economy, a 20 percent drop in coffee prices alone predicts a 22 percent increase in the migration rate even in non-coffee producing municipalities and a 120 percent increase in major coffee producing municipalities.

The vulnerability of the agricultural sector to both climate and price shocks only exacerbates persistent levels of food insecurity. And according to the Latin American Public Opinion Project (LAPOP), food insecurity is growing in Honduras, with 44 percent of Hondurans experiencing food insecurity in 2018, more than double the level reported in 2012. Given that in 2018 those24 who experienced food insecurity were 35 percent more likely to intend to migrate than those who were not food insecure, the impact is clear.25

Hurricanes Eta and Iota have had a negative impact on food security as well. As of November 27, over 40,000 cultivated hectares have been lost entirely and more than 225,000 cultivated hectares have been seriously damaged. Basic grain crops including beans and maize have been most severely impacted, leading to serious concerns about food security of smallholder farmers. Latest estimates show coffee losses reaching over 20 percent due to persistent rains and standing water in fields. This, combined with widespread destruction of rural roads and farm infrastructure, is making access to coffee difficult and is resulting in rot of both the current crop and, in some cases, entire plantations.

Government Accountability. Related to economic challenges are corruption in both the public and private sectors, and weak democratic governance. Corruption slows economic growth and investment, and also drives migration. In GDP terms, corruption cost Honduras $2.5 billion in

25 The Americas Barometer. “Honduras 2019 AmericasBarometer Special Topic Report: An Analysis of Emigration Intentions among Honduras,” LAPOP 2018.

24 The AmericasBarometer, LAPOP 2018, 2012.

23 World Bank, Employment in Agriculture - Honduras, 2020. Data retrieved June 21, 2020.

https://data.worldbank.org/indicator/SL.AGR.EMPL.ZS?locations=HN

22 World Bank Country Overview Honduras, 2020.

21 World Bank national accounts data, and OECD National Accounts data files, updated October 15 2020, https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?locations=HN.

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2018, or the equivalent of 12.5 percent of the country’s GDP, and the data show it is getting26 worse over time. With national elections coming up in 2021, these are concerning statistics. In terms of migration, the indirect impact of corruption is obvious because of its effect on economic and violence drivers. But there is evidence that corruption itself drives migration. One in four Hondurans were victims of corruption in 2018 (measured by having been asked for a bribe), and migration intentions were nearly 50 percent higher among corruption victims than non-victims.

More broadly, corruption may impact Hondurans’ view of their future, or what academics call their “opportunity horizon.” This means that Hondurans may see their life prospects as limited27 in a context where corruption is rampant, and hence seek livelihoods elsewhere.

Citizen Security. Corruption and weak governance enable the country's high levels of violence, persistent gang presence, and transnational criminal organizations, including narcotrafficking groups. Despite a steady decline in the national homicide rate (falling from 86.5 per 100,000 in 2011 to 45 per 100,000 in 2019), homicides still remain at more than six times average global28 levels. And beyond homicide, other crimes remain rampant, including extortion, which in29

Tegucigalpa alone cost the public transportation sector $23 million in 2019. Extortion has clear30 repercussions for economic growth, given that the majority of extortion victims are businesses.31

This persistent violence is a significant driver of irregular migration, as Honduran municipalities with higher homicide rates have higher migration rates, even when controlling for economic factors. Youth, in particular, are at a great risk of engaging in and being victims of violence.

Over the last CDCS, USAID/Honduras has learned about the importance of protective factors, not only against the risk of engaging in violence and delinquent behavior, but also against irregular migration.

COVID-19. COVID-19 has already exacerbated the drivers of irregular migration in Honduras.

At the time of this writing, Honduras had reported 112,175 COVID-19 cases and 2,952 deaths.32

The Honduran Private Sector Council estimates that 500,000 jobs have been lost due to COVID-19, and the non-profit Private Contribution Fund reported in September that 56 percent of its affiliated enterprises have closed. It is also having devastating impacts on food security:33 an analysis carried out by the GOH Technical Unit for Food and Nutrition Security this year shows that over five million Hondurans are facing food insecurity due to COVID-19. The GOH has also been widely accused of corruption and the misuse of emergency funds in its pandemic

33 The Private Contribution Fund (or Regimen de Aportaciones Privadas in Spanish) is a non-profit entity created to administer a fund composed of contributions from the private sector and employees.

32 National Risk Management System (Sistema Nacional de Gestión de Riesgos – SINAGER). November 19, 2020, https://covid19honduras.org/?q=Comunicado-255.

31 Tristan Clavel, “Private sector and anti-extortion police in Honduras: perverse alliance?” Insight Crime, April 30, 2019, es.insightcrime.org/investigaciones/sector-privado-policia-antiextorsion-honduras-alianza-perversa/.

30 Sonia Nazario, “Pay or Die” New York Times, July 26, 2019, https://www.nytimes.com/interactive/2019/07/25/opinion/honduras-corruption-ms-13.html.

29 USAID uses the United Nations Office on Drugs and Crime (UNODC)’s definitions and statistics related to intentional homicide rates. According to UNODC, global homicide rates are 6.1 per 100,000, based on a 2019 analysis of 2017 data. https://www.unodc.org/documents/data-and-analysis/gsh/Booklet2.pdf.

28 Instituto Universitario en Democracia, Paz y Seguridad (University Institute for Democracy, Peace and Security), Universidad Nacional Autónoma de Honduras, “Boletín Especial sobre Homicidios en Honduras, 2019”, February 2020.

27 Jonathan Hiskey, et al. “Democracy, Governance, and Emigration Intentions in Latin America and the Caribbean,” 2011, https://publiceconomics.files.wordpress.com/2011/09/hiskey_etal_emigrationanddemocracy_11.pdf.

26 “Organizaciones Internacionales Reconocen Labor de CNA y FOSDEH”, 14 February 2020, https://opca.cna.hn/index.php/2020/07/24/mas-de-treinta-y-cinco-organizaciones-internacionales-reconocen-los-esfu erzos-anticorrupcion-del-cna-y-fosdeh.

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https://covid19honduras.org/?q=Comunicado-255 https://es.insightcrime.org/investigaciones/sector-privado-policia-antiextorsion-honduras-alianza-perversa/ https://www.nytimes.com/interactive/2019/07/25/opinion/honduras-corruption-ms-13.html https://www.unodc.org/documents/data-and-analysis/gsh/Booklet2.pdf https://publiceconomics.files.wordpress.com/2011/09/hiskey_etal_emigrationanddemocracy_11.pdf https://opca.cna.hn/index.php/2020/07/24/mas-de-treinta-y-cinco-organizaciones-internacionales-reconocen-los-esfuerzos-anticorrupcion-del-cna-y-fosdeh https://opca.cna.hn/index.php/2020/07/24/mas-de-treinta-y-cinco-organizaciones-internacionales-reconocen-los-esfuerzos-anticorrupcion-del-cna-y-fosdeh response. There has also been a disproportionate impact on women through gender-based violence (GBV) as stay-at-home orders have forced some women into vulnerable situations.

Hurricanes Eta and Iota. Within less than two weeks Honduras was struck by two of 2020’s most powerful hurricanes: Eta on November 3 and Iota on November 16. To date, these hurricanes have caused the deaths of 99 people and have affected over three million Hondurans. As a result of devastating flooding, especially in northern Honduras, homes have been damaged or destroyed forcing tens of thousands into temporary shelters, and there has been significant damage to roads, bridges and other infrastructure, including the San Pedro Sula International Airport. The impacts of these hurricanes have compounded the challenges already facing Honduras due to COVID-19, and the congregation of people in shelters increases the risk for COVID transmission and violence. While the full impact of Hurricanes Eta and Iota on long-term development is not yet known, these recent events will no doubt set Honduras back on its development trajectory and worsen the drivers of irregular migration.

HONDURAS’S VISION FOR ADDRESSING DEVELOPMENT

The GOH has developed goals and plans to address several of these key development challenges over the 2018-2022 period, captured by its “Government Strategic Plan 2018-2022” (PEG, Spanish acronym). USAID/Honduras held several stakeholder consultations to share34 its preliminary CDCS work and learn about the GOH’s plans. The PEG has the following Strategic Objectives:

1. Prosperity and Social Development (aligned with DO1 and DO3)

2. Inclusive and Sustainable Economic Growth (aligned with DO1)

3. Infrastructure and Logistical Development (aligned with DO1)

4. A More Just, Peaceful, and Inclusive Society (aligned with DO2 and DO3)

5. Democratic Governance and Development (aligned with DO2)

The Plan also highlights the importance of enhancing the skills and abilities of the youth population in particular, most explicitly in its sectoral strategy on “inclusive and sustainable economic growth.” This strategy seeks to increase employment and entrepreneurship opportunities in the formal sector of the economy, “especially for youth.” The CDCS goal35 statement directly aligns with this GOH strategic focus and was echoed in stakeholder conversations.

There is also broad alignment between the CDCS and PEG on the importance of migration.

The PEG names migrants as a vulnerable population and highlights migration and its causes as a priority for the country. This priority was confirmed in stakeholder consultations, where the36

GOH highlighted the importance of an integrated approach to addressing migration.

Stakeholder conversations also revealed a strong mutual commitment to helping the country respond to COVID-19, recover from Hurricanes Eta and Iota, and boost economic growth through key initiatives, including América Crece and the U.S. International Development Finance Corporation (DFC).

36 Government of Honduras, PEG 2018-2022, 108.

35 Ibid, 37.

34 Government of Honduras, Plan Estratégico del Gobierno 2018-2022, last modified April 2019, http://www.scgg.gob.hn/sites/default/files/2019-06/PEG%202018-2022%20-Versio%CC%81n%20Actualizado%20abri l%202019.pdf.

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http://www.scgg.gob.hn/sites/default/files/2019-06/PEG%202018-2022%20-Versio%CC%81n%20Actualizado%20abril%202019.pdf http://www.scgg.gob.hn/sites/default/files/2019-06/PEG%202018-2022%20-Versio%CC%81n%20Actualizado%20abril%202019.pdf

COUNTRY ROADMAP TOP-LEVEL TAKEAWAYS

Honduras’s 2020 and 2021 Country Roadmaps reflect a relatively high level of government commitment on Economic Policy dimensions. Unfortunately, this is not translating into significant, real economic gains and inequality remains an enduring problem. The country’s low scores on the Open and Accountable Governance dimensions rank it among the lowest in the Latin America and Caribbean (LAC) region and are concerning, especially in light of the approaching 2021 national elections. And Honduras’s ICT Adoption score ranks only above Haiti in the LAC region. With respect to its neighboring countries, Honduras falls behind neighboring Guatemala and El Salvador across the J2SR dimensions overall, while showing more progress than Nicaragua. Across the larger LAC region, Honduras lags behind most other countries in both capacity and commitment metrics. COVID-19 is predicted to negatively impact many of these metrics.

STRENGTHS AND CHALLENGES ON J2SR COUNTRY ROADMAP

In assessing strengths and weaknesses, it is useful to both understand where Honduras is today and also how it has changed. Changes discussed below typically refer to Honduras’s trajectory since 2013, using the 2021 Honduras Country Roadmap.

Honduras continues to backslide in several areas, most notably in its commitment to Open and Accountable Governance. In contrast, Honduras modestly improved in the Government Capacity metrics of Government and Tax System Effectiveness, though it weakened slightly in Safety and Security.

There are several indicators that are cause for optimism and that signal points of entry for USAID interventions to accelerate advancement. A particular bright spot for Honduras is the Commitment metric of Inclusive Development. It has the third highest score in LAC for Economic Gender Gap, and has led the LAC region in gains in this area. While the country’s overall trajectory in female labor force participation has been positive, the gap remains concerning with just 41 percent of women participating in the labor force compared to 75 percent of men. Although it is below average for LMICs in Social Group Equality, Honduras tied with Mexico for the largest gains in this score. Honduras also has an above-average score compared to other LMICs in its Civil Society Capacity metric.

And with respect to Biodiversity and Habitat Protection, Honduras has made progress in declaring protected areas. However, it ranks low in Environmental Policy (part of the Economic Policy metric) compared to other LAC countries, and has seen no change in this score in recent years. In addition, effective management and enforcement of environmental law within these protected areas is limited or non-existent.

Shifting to Citizen Capacity metrics, Honduras is just above average in poverty rate for an LMIC, but is second lowest in LAC, after Haiti. A particular strength is Honduras’s Child Health metric, which is the country’s highest scoring metric and is on an improvement trajectory. And while Education Quality is below average for LMICs, the country has developed a sectoral plan to transform education with the help of donors. And finally, while Honduras’s ICT Adoption score reflects challenges, the country has improved on this metric since 2016.

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III. STRATEGIC APPROACH

The 2020-2025 CDCS strategic approach outlined below is informed by three strategic priorities:

1) Facilitate a systems change approach—social, economic, justice and security, environmental, education; 2) Partner and co-create with the private sector to capitalize on shared values, foster innovation, and facilitate joint investment where interests align; and, 3) Generate opportunities for citizens—especially youth—to actively engage and invest in their future in Honduras. The systems change approach provides an analytical framework for identifying key principles that form the backbone of USAID’s strategic approach: integrated programming, flexibility and adaptation, and redefining relationships with local actors. The focus on the drivers of irregular migration defines the boundaries of the systems USAID anticipates working within, as described in the results framework. USAID has determined that the only sustainable way to encourage Hondurans to stay and invest in their future is through systems change and integrated approaches. The priority of creating opportunities, especially for youth, provides a clear focus for the vision that is positive and forward-looking.

FOCUS ON SYSTEMS CHANGE

USAID/Honduras will facilitate change through a systems change approach, which the Mission defines as “the use of a collection of approaches and principles to achieve long-term, sustainable change through development programming, which realizes fundamental changes in how interdependent parts of a system—roles, rules, relationships, resources and results37

—across sectors, actors, populations, and geographies, are configured and interact.” The Mission chose to take a systems change approach because, while the Mission achieved results as intended over the previous CDCS, its success was limited to target geographies and populations and was highly dependent on USAID’s ability to invest against the problems being confronted. The Mission recognizes a need to catalyze local systems-led development if sustainable outcomes are to be achieved. Across the country, violence continues to affect large segments of the population, corruption is still prevalent, and the majority of people in western Honduras still live in poverty. The Mission has learned that to achieve broad, sustainable change in Honduras, patterns need to be broken; the systems themselves which produce these states need to change.

Integrated Programming. USAID/Honduras has been a leader in the Agency in advancing integrated programming, which the Mission defines as “Any development initiative (program, project or activity) which proactively incorporates work across multiple sectors to achieve a shared result.” Integrated programming can happen within a single initiative, or between multiple initiatives working together. USAID/Honduras’s approach to integrated programming is proactive in that it is the result of conscious, intentional decisions and actions. It is systematic in that it is implemented through defined structures, processes, and behaviors across DOs and offices in the formulation, design, adaptive management, and evaluation of integrated programs.

USAID/Honduras views integrated programming as a key tool to design and implement development programming to achieve systemic change. This is especially relevant where the ‘shared result’ is a systemic change. In addition, USAID/Honduras has witnessed firsthand how effective integration can lead to more effective and efficient use of resources, and results achievement. USAID/Honduras’s experience with integrated programming is that it decreases

37 USAID, Local Systems: A Framework For Supporting Sustained Development, April 2014.

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redundancy of efforts between activities, increases reach, and can achieve results that would not be possible by focusing on one sector or actor.

Structurally, USAID/Honduras has incorporated integration from strategy down to activity levels.

At the strategy level, DOs include results that are aligned with multiple sectors and dimensions.

For example, DO1 includes a sub-IR under IR 1.1 that focuses on “Youth leadership in driving economic growth strengthened” as well as sub-IRs that directly address education and workforce development for youth. These are directly linked to and intertwined with sub-IR 1.2.1 “On- and off-farm enterprise productivity increased,” recognizing that good job opportunities are needed for youth when they finish their education or training, and that businesses cannot grow and expand without well-trained youth. In addition, sub-IRs under IR 3.2 illustrate USAID/Honduras’s awareness that addressing security-related barriers is critical for youth to access the education and employment they need to succeed in Honduras. At the activity level, activities may also include results aligned with multiple sectors and dimensions.

Another prominent example of USAID/Honduras’s commitment to an integrated approach under this strategy is the inclusion of shared IR 2.4/3.1 “Governance to reduce impunity improved.”

This shared IR demonstrates that the achievement of the CDCS goal relies on effective integration among all the DOs, in this case between DO2 and DO3 in particular. Inclusion of this IR under DO2 recognizes that reducing high rates of impunity in Honduras is a key component of USAID’s anti-corruption efforts and paramount to effecting positive change in democratic governance. Including this IR under DO3 recognizes that reducing impunity is necessary to both decrease the violence that drives insecurity and thrives in an environment of impunity, and support effective and transparent operation of justice institutions responsible for prosecuting criminal acts.

USAID/Honduras will build the systems change approach and integrated programming requirements into awards, linking integration into key deliverables such as work plans, Monitoring, Evaluation, and Learning (MEL) and Collaborating, Learning, and Adapting (CLA) plans, and reporting. USAID/Honduras promotes and supports a culture of integration and CLA within and between teams at the DO, Office, and activity levels, and between implementing partners.

Flexibility and Adaptability. Effecting change requires working with the system “as is,” even as it is continually changing because of migration, droughts, and evolving politics in Honduras in recent years. Additionally, experience has shown that the ability to move work forward depends on the incentives and disincentives, and the willingness of different players in the system to work on those issues, which changes with political, economic, environmental, and social circumstances. Lastly, in a complex, interdependent system, how a system will respond to changes is often unpredictable. Together, these elements have driven USAID/Honduras to embrace and promote a nimble, flexible, adaptive approach to programming within the new

CDCS.

One way the Mission has incorporated flexibility into the strategy is through IR 1.3 (Vulnerability to key shocks and stresses decreased), and in particular sub-IR 1.3.3 (Public and private sector accountability and response to emerging challenges improved). While Honduras is currently experiencing the COVID-19 crisis and aftermath of two hurricanes and requires assistance across multiple sectors to address their direct and indirect impacts, the Mission recognizes that

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over the five-year strategy period, the country will likely face other shocks as well, be they environmental, social, economic, or political. This IR provides USAID/Honduras with the flexibility needed to implement new activities, engage new actors, and use new approaches as urgent needs arise.

REDEFINING THE RELATIONSHIP

USAID/Honduras’s focus on strengthening the GOH and other stakeholders' self-reliance by shifting to a systems change approach has clear implications for the Mission’s relationships. To help Honduras achieve progress on its J2SR, the Mission will put the systems change approach into practice, and as defined earlier in this document, will take a facilitative approach to development under this CDCS. USAID/Honduras will prioritize collaboration, co-creation, and co-implementation with the GOH, other local actors, and implementing partners.

USAID/Honduras will be strategic and intentional about its role as it supports Honduras on its J2SR. The Mission envisions shifting to a more facilitative approach, though its programming will fall on a continuum of direct to facilitative approaches. In this sense, USAID/Honduras will act as an observer of larger systems operating in Honduras and as a facilitator of change that moves systems actors in Honduras to act on the changes they wish to see. This means that USAID/Honduras will design programming to foster innovation and creativity among local actors by helping reduce the risk local actors face when innovating. In addition, USAID/Honduras will act as a facilitator and convener as appropriate, facilitating connections between local actors.

The Mission will work with and through local actors to design programming, including to identify and understand the systems USAID/Honduras seeks to shift.

Supporting Civil Society.USAID/Honduras has worked with civil society actors to achieve social, economic, and governance progress for decades. Under this CDCS, the Mission will shift to an organizational performance approach, aligning capacity development support as a means to help organizations achieve performance goals. This includes both individual organizational performance, as well as an increased emphasis on collective performance, which refers to the ability of organizations to effectively work together to achieve shared objectives, expand and strengthen networks, with mobilization as a key measure of success.

This approach also aligns with the Agency’s New Partnerships Initiative (NPI) by empowering local actors as catalyzers of Honduras’s J2SR; the Mission will prioritize working with youth organizations to the extent possible. To this end, USAID will work with a variety of actors, both formal and informal. Key areas of collaboration include supporting community groups as change agents to reduce crime and violence, impunity, and corruption; increasing environmental protection including by supporting environmental defenders ; and improving human rights,38 justice, and democratic governance.

Financing Self-Reliance (FSR). Under this CDCS, USAID/Honduras will support the pillars of FSR. Building on previous success with the Ministry of Finance in the areas of Public Financial Management and Fiscal Transparency and Accountability, the Mission will continue to push for

38 The Special Rapporteur of the General Assembly of the United Nations recognizes specific groups of human rights defenders as at risk for violence and discrimination, highlighting those who defend civil and political rights, the human rights of indigenous peoples, and defenders of land and the environment, among others (The Inter-American Commission on Human Rights, 2019). Further, structural issues like poverty, inequality, and discrimination in Honduras contribute to repression and violence directed at those who defend land and the environment.

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citizen engagement in the budget formulation process and access to budget information.

USAID will also support digital solutions to improve efficient and effective budget decision making, and to increase budget transparency. While USAID will implement these efforts under DO2, interventions under both DO1 and DO2 will support the Enabling Environment for Private Investment pillar by reforming and simplifying business registration procedures, and contribute to reducing corruption that inhibits private sector growth.