Rafael Leonardo Callejas Romero (born 1943) was president of Honduras from 1990-1994, continuing constitutional civilian rule of the country and promoting economic development along neoliberal lines.

Rafael Leonardo Callejas Romero, born November 14, 1943, in Tegucigalpa, was the son of a landowning family. His elementary education was at the American School in Tegucigalpa, and he graduated from the San Francisco Institute (high school) of that city. Callejas received his B.S. (1965) and M.S. (1966) in agricultural economics from Mississippi State University, which in 1989 awarded him an honorary doctorate. He also studied agricultural development at the Social Studies Institute in The Hague, Holland, in 1967. Callejas married Norma Gaborit. They had three children.

Upon returning to Honduras he served on the Higher Council for Economic Planning, 1967-1971. In 1968 he became head evaluator in the Office of Agricultural Planning, then deputy secretary of the department of Natural Resources, 1972-1975; secretary of that department, 1975-1980; and director of agricultural planning, 1983-1984. He was also president of the board of directors of the National Bank for Agricultural Development, president of the board of the Honduran Institute for Agricultural Trade, and a member of the boards of the National Utility Company, the National Port Authority, the National Water Works and Sewerage Service, the Honduran Corporation for Forestry Development, and the Honduran Banana Corporation.

In 1980 he became treasurer of the National Party. When the military agreed to free elections in 1981, Callejas became the National Party candidate, but lost to the Liberal Party's Roberto Suazo Córdova. Four years later Callejas headed the National Renovation Movement, a conservative faction of the National Party. It favored private sector development in collaboration with Ronald Reagan's Caribbean Basin Initiative. The election of 1985 was bitter. Internal divisions in both major parties resulted in an electoral plan that essentially combined the primary with the general election. In a field of nine candidates, Callejas won a strong plurality of 41 percent against only 27 percent for the leading Liberal, José Azcona Hoyo. But the combined Liberal total (772,661) exceeded the National total (686,494), allowing Azcona to claim the presidency. Although this outcome angered Callejas' National Party, it accepted the decision in return for a power-sharing arrangement by which the National Party held several cabinet posts and five of the nine Supreme Court seats. This bipartisan government was notably unsuccessful in reversing Honduras' serious economic problems, rising crime rate, and unpopular involvement in the Contra war in Nicaragua.

Finally, Callejas won the election of November 1989, winning an absolute majority of 51 percent over the Liberal Carlos Flores Facussé (who received 43 percent). His campaign promised economic reform, an end to corruption, and demilitarization. He enjoyed strong U.S. support in an electoral campaign that was remarkably free of the fraud and violence that had accompanied the 1985 election. Callejas' inauguration on January 27, 1990, marked the first constitutional transition to an opposition leader in Honduras since 1932. Callejas' party also won a congressional majority.

Callejas cultivated close ties with the industrial nations and was popular among those advocating conservative (neoliberal) economic policies. The 4th International Democratic Association, meeting in Tokyo September 21-23, 1989, had elected him as its vice president upon the nomination of British Prime Minister Margaret Thatcher. Credibility in the international community earned Honduras favorable treatment by the International Monetary Fund, the World Bank, and the U.S. and European governments.

Callejas' victory came amid problems arising from Honduras' involvement in the Contra war against the Nicaraguan Sandinistas. That struggle stimulated large-scale immigration of Nicaraguan refugees, and the influx of U.S. aid in support of the Nicaraguan Contras contributed to inflation, uneven economic development, and political turmoil in the country. The defeat of the Sandinistas in the February 1990 Nicaraguan election allowed Callejas to achieve prompt removal of Contra bases in Honduras.

Callejas enjoyed high popularity and some economic improvement during the initial phases of his economic reforms. He reduced government expenditures and increased exports, especially of non-traditional maquiladora (processing) production, which by 1992 accounted for 35 percent of Honduran exports. He encouraged investment with lower taxes and tariffs. One of Callejas' first actions as president was to devalue the lempira to close to the black market rate and to begin structural adjustments according to recommendations by the U.S. Agency for International Development (AID). He sought to decrease capital flight from the country and undertook to privatize the National Production Development Agency (INFOP), various natural resources, the National Agrarian Institute, public works and transportation enterprises, and possibly the entire educational system. Callejas favored expansion of the North American Free Trade Agreement to include all of Latin America. He reduced tariff rates from a maximum of 135 percent in 1989 to a maximum of 20 percent by 1992. Threatened with curtailment of favorable U.S. trade privileges, his government in 1993 enacted an intellectual property law aimed at curbing the widespread piracy of television cable and video services.

Callejas faced opposition to his economic policies from organized labor. Under his pro-business policies many workers suffered declining living standards. While exports grew, the lower tariffs let imports pour into the country, displacing some local industry. By late 1993, according to a World Bank report published in Tegucigalpa, Callejas' structural adjustment policies had caused 20 percent of the Honduran population to be poorer, even as the macroeconomic situation improved. Devaluation of the lempira had reached 300 percent, and interest rates of 30 percent discouraged investment. Callejas argued that major increases in export earnings would soon ease the problem, but bank credit had virtually ceased and serious shortages of staple foodstuffs were causing social unrest.

Although Callejas was the third elected civilian president to rule Honduras in succession since 1980, the armed forces remained a strong force in Honduran politics. Military expansion accompanying the Contra war contributed to this, but it also reflected the shallowness of Honduran democracy. The army remained autonomous under Callejas, a fact emphasized by its arbitrary replacement of his armed forces chief in December 1990. The cost of Honduras' large military establishment contributed to the country's serious debt, but Callejas was powerless to reduce its size. Right-wing political violence during Callejas' administration was associated with the military's secret police, the National Investigation Directorate (DNI). Finally, in 1993, in response to popular animosity toward the military, Callejas' administration formally ended its connection to the DNI.

The Honduran presidency is limited to a single four-year term. In November of 1993 Carlos Roberto Reina, an opposition candidate, was elected to replace Callejas. Reina assumed the presidency in January of 1994.

Further Reading

• For a detailed overview of recent Honduran political history see James Dunkerley, Power in the Isthmus, A Political History of Modern Central America (London: 1988); Alison Acker, Honduras: The Making of a Banana Republic (1988); and Tom Barry and Ken Norsworthy, Honduras: A Country Guide (1990). More detail on Callejas' presidential administration may be found in Howard H. Lentner, State Formation in Central America: The Struggle for Autonomy, Development, and Democracy (1993).