TAIPEI (Taiwan News) — Honduras' shrimp exports are set to experience the largest decline in history this year following its decision to break diplomatic ties with Taiwan last year, which could lead to a potential loss of NT$1.45 billion (US$45 million) in foreign exchange revenue.

According to Honduran media El Heraldo, Honduras' decision to sever diplomatic ties with Taiwan has led to the loss of preferential trade agreements. This has made it more difficult and less profitable to export shrimp to Taiwan, per CNA.

The Honduran Association of Aquaculturists has forecast a significant 24% decrease in white shrimp exports this year, as reported by El Heraldo. This decline will reduce annual exports to 60 million pounds (27 million kilograms), down from 78.9 million pounds in the previous year.

Based on data up to Oct. 31, Honduras had exported 51.4 million pounds of shrimp. This is a 15.7 million pound decrease compared to the same period in the previous year.

The primary driver of the decline in Honduran shrimp exports is the significant drop in shipments to Taiwan. As of Oct. 31, exports to Taiwan had fallen from 22.1 million pounds to 7.4 million pounds compared to the same period in the previous year.

The termination of the free trade agreement with Taiwan in March 2023 has resulted in the imposition of a 20% tariff on Honduran shrimp exports, hindering market access.