The Honduran government's commitment to maintaining disciplined public finances could continue improving the country's fiscal flexibility. However, overall weak institutions, crime, and high levels of poverty remain major challenges. Energy-sector reforms are advancing, and the standby arrangement signed with the IMF--an economic program that sets fiscal performance standards and tackles energy reform as one of its main objectives--remains on track. We are revising our outlook on Honduras to positive from stable and affirming our 'B+/B' sovereign credit ratings. The positive outlook reflects our view that strengthening revenue management and tighter controls of current expenditures could improve Honduras' fiscal flexibility faster and, as a result, contain the expected annual increase in its debt. On July 18, 2016, S&P Global Ratings revised
