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Honduras The Restoration of Order, 1925-31
Despite another minor uprising led by General Ferrera
in 1925,
Paz Barahona's administration was, by Honduran standards,
rather
tranquil. The banana companies continued to expand, the
government's budgetary situation improved, and there was
even an
increase in labor organizing. On the international front,
the
Honduran government, after years of negotiations, finally
concluded
an agreement with the British bondholders to liquidate
most of the
immense national debt. The bonds were to be redeemed at 20
percent
of face value over a thirty-year period. Back interest was
forgiven, and new interest accrued only over the last
fifteen years
of this arrangement. Under the terms of this agreement,
Honduras,
at last, seemed on the road to fiscal solvency.
Fears of disturbances increased again in 1928 as the
scheduled
presidential elections approached. The ruling PNH
nominated General
Carías while the PLH, united again following the death of
Policarpo
Bonilla in 1926, nominated Vicente Mejía Colindres. To the
surprise
of most observers, both the campaign and the election were
conducted with a minimum of violence and intimidation.
Mejía
Colindres won a decisive victory--obtaining 62,000 votes
to 47,000
for Carías. Even more surprising was Carías's public
acceptance of
defeat and his urging of his supporters to accept the new
government.
Mejía Colindres took office in 1929 with high hopes for
his
administration and his nation. Honduras seemed on the road
to
political and economic progress. Banana exports, then
accounting
for 80 percent of all exports, continued to expand. By
1930
Honduras had become the world's leading producer of the
fruit,
accounting for one-third of the world's supply of bananas.
United
Fruit had come increasingly to dominate the trade, and in
1929 it
bought out the Cuyamel Fruit Company, one of its two
principal
remaining rivals. Because conflicts between these
companies had
frequently led to support for rival groups in Honduran
politics,
had produced a border controversy with Guatemala, and may
have even
contributed to revolutionary disturbances, this merger
seemed to
promise greater domestic tranquility. The prospect for
tranquility
was further advanced in 1931 when Ferrera was killed while
leading
one last unsuccessful effort to overthrow the government.
Many of Mejía Colindres's hopes, however, were dashed
with the
onset of the Great Depression. Banana exports peaked in
1930, then
declined rapidly. Thousands of workers were laid off, and
the wages
of those remaining on the job were reduced, as were the
prices paid
to independent banana producers by the giant fruit
companies.
Strikes and other labor disturbances began to break out in
response
to these conditions, but most were quickly suppressed with
the aid
of government troops. As the depression deepened, the
government's
financial situation deteriorated; in 1931 Mejía Colindres
was
forced to borrow US$250,000 from the fruit companies to
ensure that
the army would continue to be paid.
Data as of December 1993
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