Political chaos, economic pain

TEGUCIGALPA, Honduras - A woman caring for six grandchildren can no longer afford milk. A bricklayer who used to work six days a week now is lucky to get two. A shop manager has seen his earnings evaporate.

Nearly four months after the military ousted President Manuel Zelaya, Hondurans are feeling the sting of a political crisis that has eroded an already fragile economy and increased hunger in one of the Western Hemisphere's poorest countries.

"Everything has gone up since the coup," Leticia Medina, 50, said as she walked along an unpaved road in the ramshackle Honduran capital.

Honduras wasn't in great shape before the June 28 coup - the global recession had cut demand for exports and slowed the remittances many families depend on. But the political chaos, with its protests, curfews, blockaded streets, and international isolation, made things worse.

Tourists have stayed away from the beaches, Mayan ruins, and rain forests - a decline driven in part by a U.S. State Department alert recommending that people avoid nonessential travel to Honduras.

In Roatan, a world-class diving destination far from the troubles in the capital, tourism dropped 85 percent after the coup, said Mario Pi, president of the island's Tourist Information Center.

"For the hotels, it's been a disaster," said Pi, who predicted that the resort would finish the year down 50 percent.

Ordinary shoppers in the capital, Tegucigalpa, are staying away from stores out of economic anxiety or fear of protests and traffic jams.

Countries around the world have demanded that Zelaya be allowed to return and serve out his term, which ends in January, in a coalition government. Many have cut off aid to isolate the interim government: The United States suspended about $40 million in nonhumanitarian assistance, and the European Union halted $90 million. Multilateral lending agencies have also blocked the country's access to credit.

The measures have had severe ripple effects in Honduras, where more than 70 percent of the population of 7.7 million are considered poor and more than 1.5 million get by on $1 a day or less.

Among those feeling the effects is Susan Trimino, 65, who is caring for six grandchildren and can no longer afford milk on her husband's meager earnings as a laborer. Instead, she said as she walked along a dirt road in plastic shoes, she gives them ground-up corn and water.

Bricklayer Luis Palma, 24, who lives in the capital, said there was such a shortage of work that he earning less than $8 a day.

Interim President Roberto Micheletti and his supporters insist they acted constitutionally to remove a president they considered inept, corrupt, and too close to Venezuelan President Hugo Chavez.

The military ousted Zelaya, with the backing of Congress and the Supreme Court, for pushing a referendum that his critics contended was an attempt to repeal a constitutional ban on term limits - an allegation Zelaya denies.

Negotiators said Wednesday that they had reached a consensus on Zelaya's return to the presidency, but they later toned down hopes, saying the final deal was still being worked out.

As the two rival factions negotiate for control of the country, the elite are comfortable behind their walled homes, though the United States has revoked the visas of some of Honduras' prominent business and political leaders.

Those further down the economic ladder are just eager for the situation to be resolved.

Miguel Alvarez, manager of an electronics and audio equipment store, said his sales had dropped 60 percent and he had laid off two of his 16 employees. If sales don't pick up, the shop might have to move or close.

"What we want is that it's resolved in the most peaceful way possible," Alvarez said. "We can't operate in these conditions."