Opposition candidate Porfirio Lobo's victory in Honduras' presidential election Sunday poses difficult questions for the United States and Latin America over how to end the five-month Honduran crisis. The election was promoted by the leaders of a coup against President Manuel Zelaya in June, but Lobo himself was not implicated in the overthrow and he can now claim the support of a large part of the population. Brazil, Argentina and other regional leftist governments are refusing to recognize the vote, likely putting them at odds with Washington which will probably back Lobo. Here is what could happen next: q All eyes are on Washington to see if the United States will recognize the winner. The State Department Sunday night called the election “a necessary and important step forward” but did not say whether Washington now formally regards Lobo as president-elect. US recognition for Lobo would divide President Barack Obama from major Latin American powers who say the election was invalid because it was backed by the coup leaders and will probably keep Zelaya from returning to office and handing over power in January. Recognizing the election will put the United States on a collision course with Brazil, the emerging power of Latin America. Brazil's leftist government, along with those of Argentina, Venezuela and others, refuses to acknowledge the election as legitimate. Panama, Costa Rica and Peru have said they support the election but Mexico, Colombia and Chile have yet to state their position and are probably waiting to hear what Washington has to say. q A wealthy landowner from a ranching province, Lobo faces the tough task of what to do with Zelaya, now holed up in the Brazilian embassy in the Honduran capital, Tegucigalpa. The United States, Latin American governments and the European Union all called for Zelaya to be reinstated but the de facto government led by Roberto Micheletti has stalled on bringing him back. His return now appears unlikely, and Lobo is set to take office in January. Lobo says he will leave the issue of Zelaya's return up to a congressional vote on Dec. 2 but the same lawmakers who voted in support of Zelaya's ouster on June 28 on charges he violated the constitution are unlikely to allow him to return to office. Zelaya has said he refuses to be reinstated as part of a deal that would legitimize the coup. Zelaya told Reuters that Lobo was his “close friend” but says the two have had not discussed his fate after the election. Zelaya insists he will not leave the embassy. Honduran security forces surround the compound and threaten to arrest him if he steps outside. Lobo may try to negotiate some sort of political amnesty for Zelaya and the main players in the June coup to try to unite the deeply divided country. q Lobo will be faced with an economy already hobbled by the global financial crisis and further hit by international isolation after the coup. Tourists were scared away from the country's Caribbean islands and Mayan jungle ruins, loans from multinational lenders were frozen and investors were left waiting for the crisis to pass. Even before the coup, Honduras' textile sector lost thousands of jobs as demand from the United States – Honduras' top trading partner – dried up and remittances from immigrants living aboard dwindled. Honduras is Central America No. 2 coffee producer and the industry says it was not hit by the political crisis, maintaining an increased export estimate for the upcoming harvest. But Honduras will need more than a bumper coffee crop to cover its fiscal deficit, estimated to reach 4.5 percent of gross domestic product this year, according to the US
