THE ROAD TO RECOVERY

November 30, 1998
		Of all the nations ravaged by Hurricane Mitch, none was hit harder than Honduras. NewsHour correspondent Charles Krause traveled to the Central American country for a report on its rebuilding efforts.

Nov. 5, 1998: An interview with Honduran President Carlos Flores Nov. 2, 1998: Hurricane Mitch causes widespread destruction in Latin America. Oct. 21, 1998: Update on the Texas floods. Sept. 28, 1998: Hurricane Georges leaves a trail of destruction. Sept. 25, 1998: Hurricane Georges threatens lives and homes from Florida to Louisiana. Sept. 24, 1998: Floridians prepare for Hurrican Georges. Browse the NewsHour's coverage of Weather.     AP Hurricane Mitch damage by country National Hurricane Center	CHARLES KRAUSE: Hurricane Mitch was a storm of biblical proportions, the most destructive natural disaster in Central America's modern history. For five days and five nights, there were torrential rains, flooding, and mudslides. And by the time it was over, Hurricane Mitch had caused extensive damage in Nicaragua, Guatemala, and El Salvador. But it was Honduras -- already the poorest country in Central America, and one of the poorest countries in the world that was hit hardest. Even now, some three weeks later, forensic teams are still searching for bodies buried in the rubble.
	Over 6,000 dead.
	The death toll has climbed beyond 6,000, while an even greater number is still missing. In Tegucigalpa, drinking water is scarce because the capital's sewage and water systems were cut and badly damaged. It may be years before they're rebuilt. Meanwhile, the Honduran economy is virtually paralyzed because two-thirds of the country's bridges and much of the highway system were wiped out and will have to be rebuilt. U.S. Ambassador James Creagan. U.S. AMBASSADOR JAMES CREAGAN: The roads are critical. That's the immediate reconstruction need, and we will be helping to do that. Temporary bridges, fords through streams, that are good until the rainy season next June, and working on the roads themselves. It's amazing that -- you may have seen the North Coast - but there are areas where 30 or 40 kilometers of road have simply disappeared. CHARLES KRAUSE: Finance Minister Gabriella Nunez says Honduras has been set back 25 years.
	GABRIELLA NUNEZ, Honduran Finance Minister: I would say we lost the whole country, not only the economy side, but the psychological situation with everybody in this country. So I would say we have a lot of job, a lot of work to do in the next maybe 15 to 20 years. CHARLES KRAUSE: Beyond the highways, the bridges and the infrastructure that's been destroyed, fully one-fifth of the Honduran population -- nearly a million four hundred thousand people -- remain homeless. Many of them are still stranded, dependent on helicopters -- and the mercy of international relief agencies --- for their food and water. Others live in makeshift tents along highways near their homes, which are still too damp and caked with mud to reinhabit. CHARLES KRAUSE: Maria Lopez Moreno told us that relief supplies are being delivered on a regular basis. But food comes in only every other day, and here on the outskirts of La Lima, Honduras, the homeless are forced to use what little money they have to buy drinking water. Elsewhere, the homeless live in schools that've been converted into temporary shelters. Cramped and primitive, the schools feel like refugee camps, and Honduras feels like a country that's lost a war.
	Rebuilding over 200,000 homes.
	It's estimated that Honduras will need to rebuild upwards of 200,000 houses, and that much of the money will have to come from international lending institutions like the Inter-American Development in Washington. Over the past month, Enrique Iglesias, the bank's president, has been meeting on an emergency basis with Nunez and the other Central American finance ministers trying to assess their immediate needs and then what it will take to rebuild. Iglesias says he's never seen a natural disaster more destructive than Hurricane Mitch. ENRIQUE IGLESIUS, President, Inter-American Development Bank: It affected and destroyed the fiscal infrastructure and at the same time destroyed the economic infrastructure -- the plantations of bananas, of coffee, of agriculture in general, damages that will take four or five years to really be revealed. So it is a catastrophe of major proportions in lives and in economic infrastructure, which is even sadder because this region has been for years subject to all kinds of problems. We have there dictatorships, we had there wars, confrontations for many, many years. When they started in the last 10 years to reveal their democracies, their economies, and we were starting to look, the thing was coming in the right direction, they had this catastrophe, particularly Honduras and Nicaragua. CHARLES KRAUSE: Concern about the potential political impact of Hurricane Mitch is based on Central America's history: the Somoza government's failure to rebuild Nicaragua's capital, Managua, after the earthquake there in 1972 led directly to the Sandinista revolution seven years later, and in 1974, three months after the last major hurricane hit Honduras, there was a military coup. So the country's current president, Carlos Flores Facusse, is taking no chances. From the moment Mitch hit, he's been directly involved in virtually every aspect of the relief effort--- visiting shelters for the homeless and meeting important visitors, like International Monetary Fund director Michel Camdessus. JIM LEHRER: The tragedy in the Central American nation of Honduras and to - CHARLES KRAUSE: Flores has also used the media effectively to appeal for international sympathy and support. During the first days after the hurricane, there was widespread fear that businessmen would take advantage of food shortages to drive up prices. But the government responded quickly. And now, there's general agreement that Flores has been more effective than many expected handling this first phase of the crisis.
	JAMES CREAGAN, U.S. Ambassador: We try to think about it in U.S. terms and try to think about dead and homeless in US terms where you might have 20 to 40 million homeless, that kind of thing. It's really big and it will be tough, but there's a dedication on the part of Hondurans and I'll tell you, I have been impressed both by the Honduran public sector and also by the Honduran people out there. CHARLES KRAUSE: Still, there's a general consensus that the most difficult time for Honduras is yet to come. Like someone involved in a very serious automobile accident, the emergency rescue teams have arrived and Honduras has been stabilized. But the internal injuries are so great and the twin opportunistic infections of incompetence and corruption are so prevalent in situations like this one -- especially in Central America -- that rebuilding the country may prove even more difficult than the initial relief effort. Nowhere is the task ahead more evident than the Sula Valley, where U.S. fruit companies own vast banana plantations and where 70 percent of the Honduran economy comes from. As we overflew the valley, Jose Molina, vice president of the local Chamber of Commerce, told us the business community is anxious for the world to know the extent of the damage and what it will take to rebuild.
	Destruction of the banana crop.
	JOSE MOLINA: See all these bananas are starting now to turn yellow, so all the crop is completely lost. You see that there's so much destruction here, that there's so much water still in these areas, because the two rivers converged, and the rivers, I believe, still go on into areas where crops were being planted, or where they had cattle. CHARLES KRAUSE: Although most of the Sula Valley is used for agriculture, there's an increasingly important number of maquila plants that manufacture mostly clothes for export to the United States. At the Continental industrial park, ten of the plants were flooded, and their workers are now increasingly desperate -- picking through mounds of discarded clothing trying to find anything at all that's salvageable. We asked them about an incident the day before, when several hundred workers had reportedly forced their way into the industrial park itself looking for scraps of cloth they might dry out and use for clothing. CHARLES KRAUSE: "We're all desperate," she told us. "We had to get in and they wouldn't let us in, so we used force." We also encountered the same anxiety among the homeless in Tegucigalpa, where former residents of a neighborhood called Miramesi showed us where their homes had been before they were wiped out -- literally overnight. Now, Miramesi's 250 families spend much of their time filling out government forms with no indication of whether, where or when they'll be given land and some assistance to rebuild. Michael Miller is an American who was in Tegucigalpa working with street children before the hurricane. He's now working with the homeless from Miramesi. CHARLES KRAUSE: Do you sense that people here are beginning to get frustrated? MICHAEL MILLER, U.S. volunteer: Definitely. On Sunday, we had to leave one of our five shelters, and that brought up a lot of emotions in the people. They had been stable in the shelters. They had established themselves and organized themselves and to have to leave a shelter brought up a lot of the feelings of homelessness and hopelessness. I think with each passing week, the people are going to get more and more frustrated and communities are going to start talking about land invasions very soon. CHARLES KRAUSE: The danger of delaying reconstruction programs, especially for the poor and the homeless, is apparent -- even to those far removed from the shelters and the neighborhoods that were heavily damaged or swept away. Banker Guillermo Bueso is an influential member of the Honduran establishment who says the reconstruction effort must begin quickly. GUILLERMO BUESO: Why? Because you may have people so distressed, so abandoned that we may have social frictions. CHARLES KRAUSE: Bueso estimates that the total damage caused by Mitch is close to $4 billion. And even though he's a firm believer in privatization and shrinking government control over the economy, he's concluded that only a massive public works program can forestall social unrest and revive economic activity in the short run. GUILLERMO BUESO: You need the government to reverse what we were doing. We were reducing the size and the scope of the action of the government, following of course what is the Washington consensus, and we were doing quite right. Now, priority for the government is to become again a big spender in the public -- in the utilities, roads, electricity and so forth, which are not privatized yet. My idea and my recommendation is let's start a pickup by the beginning of the next year. CHARLES KRAUSE: But even as the government rushes to develop an official assessment of the damage and a reconstruction plan, there's a growing feeling both in Honduras and in Washington that as tragic as Mitch was, it also offers a long-overdue opportunity for change. Luis Consenza Jiminez heads FIDE, a Honduran foundation which promotes private enterprise.
	An opportunity for change?
	LUIS COSENZA JIMINEZ: I think we have two choices. One is to rebuild the country as it was before the hurricane and the other one is to seize upon this opportunity and transform it into a country which is more equitable, in which we have greater opportunities--- everyone has greater opportunities. We do need international support obviously. But by and large, I think it's a task that falls upon our own shoulders. It's a question of whether we will have the will and determination to carry it through and seize upon this opportunity, as I said before, to make a difference in this country. CHARLES KRAUSE: Cosenza and others say that one of the most critical choices Honduras will have to make concerns deforestation, which contributed directly to the flooding and the high number of people and property lost during Hurricane Mitch. Grinding rural poverty and an extremely high birth rate have driven an increasing number of campesino families into Honduran cities like Tegucigalpa -- where the poor cut down trees to build shacks on desolate mountainsides or along unprotected riverbanks. LUIS COSENZA JIMINEZ: They end up living in areas that are very susceptible to flooding and we run into the problems that we have over here, so in a way, we have a double problem if you wish --deforestation on the one side that increases the possibility or probability of mudslides or large floods -- and on the other hand, we have -- because of our development -- we have people moving into the cities and having to live in areas which are really not suitable for living. So we have both effects combined and, therefore, we run into the destruction that we recently had. CHARLES KRAUSE: One answer to the problem might be land reform, traditionally a very politically charged issue in Latin America. At the Inter-American Development Bank, Enrique Iglesias says there are also a host of other issues and opportunities that must be addressed. ENRIQUE IGLESIAS: Let me give you some examples. They have a lot of infrastructure, bridges, roads. Maybe they will have to study the new routes, or new technology, so that if something happened in the future, they have learned from the present crisis. In the case of housing where they had a tremendous problem, maybe the techniques of housing construction will be different in different places with different structures. And then the environmental problem, everybody agrees that this disaster was widely, widely amplified because of environmental problems, deforestation. So let us try to make of this a major issue. The world has to help in these countries to do that, because not only are we defending the economy here or the social problems; we are defending the new democracies that took so much time, so much people dead, so much sad history behind, to endanger it now. So it's important for many, many ways. CHARLES KRAUSE: The task ahead would be overwhelming even for a developed country with far more economic and human resources than Honduras -- one reason the United States and many other countries have sent so much emergency aid since the hurricane struck. But the future, rebuilding Honduras, remains uncertain. What can be said is that the country, damaged beyond recognition and despite many handicaps, is in critical condition but it's fighting for its life. And so far, it's surviving.

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