Fear and Poverty
Jose S. Azcona Bocock
Honduras is afraid. This manifests itself primarily in the area of personal security, where the fear of homicide, assault, kidnapping, and rape reaches very high levels. This fear has tangible causes, but also quite defined methods of addressing it, and we believe that there is a consensus to strengthen our public security organs and to defeat this plague.
But there is another fear that prevents us from addressing the previous one and is limiting us in the task of advancing in defeating poverty and the lack of opportunities. This is the fear of investment at all levels: from the builder or tailor who cannot have access to someone who can lend him money to buy materials, to the middle-class family who cannot obtain reasonable financing for their home, to the great entrepreneur who cannot attract resources locally in a competitive way to participate in the international market or simply defend his quota of the national one.
More than a real lack, it is fear, which means that at these three levels there are not the necessary resources. There is a large amount of fixed capital in our country, primarily in land and real estate, but also in many other assets. There is also a large amount of liquidity, especially as deposits in the banking system. The problem is that there have been bad experiences that have made savers, banks, and those who could invest in productive activities at all levels fear failure.
This is why the collapse of the stock markets, the bad experiences of popular housing builders, and the non-transparent closures of banks, although they have occurred years ago, continue to have a terrible effect on our economic activity. Although some of the causes of these problems have been addressed, trust does not return automatically, and this is where we must finish legislating the ways to unite those who have the financial resources with those who need them efficiently and with the least possible fear.
We need to make it so that investors can buy corporate debt, but guaranteed by the regulatory body. We need investment in housing and for the bank to want these mortgages, but keeping project costs real and making them realistic for payment capacities. We need loans for micro businesses, although not in the belief that they will be forgiven, and properly qualifying the risk of investing in them.
If we achieve a true confidence of all parties that their risk will be reasonable and that their benefits will not be lost due to the malfunction of our laws, we will be able to recover, or rather build, that confidence in our financial institutions and our investors, big and small. If we do this, we will be able to build a more dynamic economy with opportunities for all; otherwise, we will continue to fall behind our neighbors and the rest of the world that have societies where economic relations are governed by law and trust in institutions.
(2005, LT)
