TPS Loss will Hit El Salvador and Honduras GDP

18 September 2026

 

El Salvador and Honduras citizens in the US stand to lose their Temporary Protection Status, with local authorities potentially tasked with deporting hundreds of thousands of migrants.

The knock on effect to both economies, especially in terms of remittance inflows are likely to be felt for decades. Currently remittances make up roughly 27% of Honduras’s GDP, with over US$8bn received so far this year and 24-26% of El Salvador’s GDP.

In a statement, Congressman Eugene Vindman said, “Forcing families to return to dangerous and unstable conditions is cruel and short-sighted.”

Vindman was reacting to protests in Washington by TPS holders, the congressman introduced a bill seeking to extend the scheme by 18 months. In July, eighty Democratic members of the US House of Representatives signed a letter urging Homeland Security Secretary Markwayne Mullin to extend the designation, a request that had received no formal response by the time the termination took effect.

El Salvador was the first country ever granted TPS, originally in 1990 following civil-war-era destruction and the designation had been renewed continuously since 2001 after a series of major earthquakes. Salvadorans previously protected by the scheme now face losing their work permits and being deported. More than 150,000 US citizen children have at least one Salvadoran relative with TPS.

In the case of El Salvador, over 170,000 citizens will face irregular migration status going forward. This is the single largest revocation of the TPS scheme since it was created in Congress. US authorities have remained silent on the subject but claim plans are in place to deal with the situation.

“We have not received any official notification from the Trump Administration about how much time it will give Salvadorans,” Dulce Guzmán, president of Alianza Américas told EFE.

In 2018, the Department of Homeland Security (DHS) ordered the cancellation of the TPS program which was halted by legal measures arguing it was discriminatory and racist. Since then the Supreme Court has decided that the President can revoke TPS measures.

In August, the DHS removed 350,000 Haitian TPS holder status and 2025 saw 600,000 Venezuelans suffer the same fate. Other countries affected include Afghanistan, Syria, Honduras and Nicaragua.

Despite a plea by Honduran President Nasry Asfura for an “orderly and clearly defined period of transition”, TPS was allowed to lapse for Honduran citizens in the US. A further grace period or extension has been ruled out.

Honduran Foreign Minister Mireya Agüero refused the claim this will lead to mass deportations or a severe impact on remittance. The minister refused to give a figure as to how many people this may affect, pointing out that the US and Honduran census are incomplete but over one million Hondurans live in the US. Of those, 200,000 are believed to have citizenship or regular immigration status.

To assist migrants, Honduran authorities have set up legal support, consular assistance and tax facilities. Returning migrants will not have to pay import tax on their goods, stated Agüero. Official figures place the number of returned migrants to Honduras at 33,000 this year.

In the case of El Salvador, the TPS holders now move into a six month evaluation period by the DHS. At the Secretary of DHS’s discretion they could announce a 12 or 18 month extension. If the Secretary decides to end the program, it must be published in the Federal Register.

However, critics claim that the measures adopted are not enough and that El Salvadoran and Honduran authorities are not ready for the return of such a volume of migrants. They are especially concerned with how this interacts with the State of Exception in El Salvador that has been in place since March 2022 and led to the arrest of over 90,000 people.

“I grew up with an American life, with American values, so why do they want to take us away?” said TPS holder Alma to EFE. “As a child, I didn’t have the opportunity to choose where to live my life,”

 

 

Source: Central America Briefing | Vol 14, Issue 17