* Clinton praises Lobo’s progress toward democracy
* Notifies Congress that U.S. relaunching aid to country
* Honduras coup still clouds U.S.-Latin America ties
By Andrew Quinn
SAN JOSE, Costa Rica, March 4 (Reuters) - U.S. Secretary of State Hillary Clinton on Thursday urged reluctant Latin American countries to normalize ties with Honduras, saying it was time to "move forward" after last year’s coup that toppled President Manuel Zelaya.
"We think that Honduras has taken important and necessary steps that deserve the recognition and normalization of relations," Clinton told a news conference in Costa Rica, where she was on an official visit.
"Other countries in the region say that they want to wait a while. I don’t know what they’re waiting for, but that’s their right to wait."
The United States helped to broker November elections that brought Honduran President Porfirio Lobo to power, but his government has been shunned by several countries in the region because the polls were organized by the de facto government that overthrew Zelaya.
Clinton is winding up a six-nation Latin American tour during which she was challenged by leaders who repeated charges that the United States did not take a hard enough line against the coup, which echoed a long history of military takeovers in the region.
The issue, along with the continued U.S. embargo against communist-ruled Cuba, has undercut early hopes for improved U.S. relations with Latin America under the Obama administration.
Clinton, who will meet Lobo and several other regional leaders in Guatemala on Friday, said she had notified Congress that the United States would restart the flow of more than $30 million in non-humanitarian aid to Honduras that was cut off after the June 28 coup that ousted Zelaya.
In total, Honduras saw $450 million in international aid frozen as the European Union, Venezuela, the World Bank and the Inter-American Development Bank all stopped payments — moves that ended up hurting ordinary Honduras, especially the poor.
U.S. CONDEMNS COUP BUT TIME TO MOVE ON
Clinton repeated that the November elections in Honduras were widely recognized as free and fair, and praised Lobo for following through on commitments to re-establish constitutional order in the country.
"He has a unity government. He has a truth commission that will be stood up. He expedited the safe departure of former President Zelaya," Clinton said, calling these all necessary steps to restore democracy.
"We share the condemnation of the coup that occurred. But we think its time to move forward and ensure that such disruptions of democracy do not and cannot happen in the future," she said.
While the United States and several of Honduras’ neighbors have recognized Lobo’s government, a number of regional heavyweights including Brazil and Argentina have kept him at arm’s distance and Honduras remains suspended from the Organization of American States.
Brazil, which gave Zelaya refuge in its embassy in Tegucigalpa during the crisis, has not ruled out relations with the new Honduran government, but noted that it wants a common position with others in the region.
Brazilian Foreign Minister Celso Amorim told Clinton on Wednesday it was important to remember that many of the countries in Latin America had experienced "the trauma of living under a military dictatorship following a coup d’etat," and said this influenced their reaction to the Honduras situation.
"You cannot take these things that lightly," he said. (Editing by Stacey Joyce)