FLORA AND FAUNA
ENERGY AND POWER
SCIENCE AND TECHNOLOGY
BALANCE OF PAYMENTS
BANKING AND SECURITIES
CUSTOMS AND DUTIES
LIBRARIES AND MUSEUMS
TOURISM, TRAVEL, AND RECREATION
Republic of Guatemala
República de Guatemala
CAPITAL: Guatemala City
FLAG: The national flag consists of a white vertical stripe between two blue vertical stripes with the coat of arms centered in the white band.
ANTHEM: Himno Nacional, beginning "Guatemala feliz" ("Happy Guatemala").
MONETARY UNIT: The quetzal (q) is a paper currency of 100 centavos. There are coins of 1, 5, 10, and 25 centavos, and notes of 50 centavos and 1, 5, 10, 20, 50, and 100 quetzales. q1 = $0.13072 (or $1 = q7.65) as of 2005. US notes are widely accepted.
WEIGHTS AND MEASURES: The metric system is the legal standard, but some imperial and old Spanish units also are used.
HOLIDAYS: New Year's Day, 1 January; Epiphany, 6 January; Labor Day, 1 May; Anniversary of the Revolution of 1871, 30 June; Independence Day, 15 September; Columbus Day, 12 October; Revolution Day, 20 October; All Saints' Day, 1 November; Christmas, 25 December. Movable religious holidays include Holy Thursday, Good Friday, and Holy Saturday.
TIME: 6 am = noon GMT.
Situated in Central America, Guatemala has an area of 108,890 sq km (42,043 sq mi), with a maximum length of 457 km (284 mi) nnw–sse and a maximum width of 428 km (266 mi) ene–wsw. Comparatively, the area occupied by Guatemala is slightly smaller than the state of Tennessee. It is bounded on the e by Belize, Amatique Bay, and the Caribbean Sea, on the se by Honduras and El Salvador, on the s by the Pacific Ocean, and on the w and n by Mexico, with a total boundary length of 2,087 km (1,297 mi).
Guatemala has long laid claim to territory held by Belize (formerly known as British Honduras). In 1821, upon achieving independence, Guatemala considered itself the rightful inheritor of this former Spanish possession and continued to regard Belize as an administrative adjunct of Guatemala. In 1859, British rights to the area were defined in a treaty with Guatemala, but, alleging that the United Kingdom had not fulfilled its obligations, Guatemala subsequently refused to recognize the British title. In mid-1975, Guatemala demanded the cession of one-fourth of the territory of Belize as a condition for recognizing that country's sovereignty.
When Belize did become independent in September 1981, Guatemala refused to recognize the new nation. In January 1983, the Guatemalan government announced that it would drop its sovereignty claim and would press instead for the cession of the southernmost fifth of Belize's territory. Guatemala's claim has been rejected not only by the United Kingdom and Belize but also by the UN General Assembly and, in November 1982, at the CARI-COM heads of government conference. In mid-1986, Guatemala and the United Kingdom reestablished consular and commercial relations.
Guatemala's capital city, Guatemala City, is located in the south central part of the country.
A tropical plain averaging 48 km (30 mi) in width parallels the Pacific Ocean. From it, a piedmont region rises to altitudes from 90 to 1,370 m (300 to 4,500 ft). Above this region lies nearly two-thirds of the country, in an area stretching northwest and south-west and containing volcanic mountains, the highest of which is Mt. Tajumulco (4,211 m/13,816 ft). The larger towns and Lake Atitlán are located in basins at elevations of about 1,500 to 2,400 m (5,000 to 8,000 ft). To the north of the volcanic belt lie the continental divide and, still farther north, the Atlantic lowlands. Three deep river valleys—the Motagua, the Polochic, and the Sarstún—form the Caribbean lowlands and banana plantation area. North of it, occupying part of the peninsula of Yucatán, is the lowland forest of Petén, once the home of the Mayas. The largest lakes are Izabal, Petén Itza, and Atitlán.
Near the boundaries of the Cocos and Caribbean plates, Guatemala is in a geologically active region with frequent earthquakes and volcanic activity. Of some 30 volcanoes in Guatemala, six have erupted or been otherwise active in recent years. A catastrophic earthquake in February 1976 left nearly 23,000 dead, 70,000 injured, and 1 million people whose homes were partially or completely destroyed.
Temperature varies with altitude. The average annual temperature on the coast ranges from 25 to 30°c (77 to 86°f); in the central highlands the average is 20°c (68°f), and in the higher mountains 15°c (59°f). In Guatemala City, the average January minimum is 11°c (52°f) and the maximum 23°c (73°f); the average minimum and maximum temperatures in July are, respectively, 16°c (61°f) and 26°c (79°f). The rainy season extends from May to October inland and to December along the coast, and the dry season from November (or January) to April. Because of its consistently temperate climate, Guatemala has been called the "Land of Eternal Spring."
On 4 October 2005, Hurricane Stan, a Category 1 hurricane, struck Guatemala's Pacific coastal region, sending winds of 128 km/h (80 mi/h) along the coast below Guatemala City. The disaster caused landslides and mudslides, which destroyed many towns. Villages near the popular tourist area of Lake Atitlán suffered damage. Almost 1,000 died and hundreds lost their homes.
Flowers of the temperate zone are found in great numbers. Of particular interest is the orchid family, which includes the white nun (monja blanca), the national flower. There is also an abundance of medicinal, industrial, and fibrous plants. Overall, there are more than 8,600 plant species throughout the country.
Indigenous fauna includes the armadillo, bear, coyote, deer, fox, jaguar, monkey, puma, tapir, and manatee. The national bird is the highland quetzal, the symbol of love of liberty, which reputedly dies in captivity. Lake Atitlán is the only place in the world where a rare flightless waterbird, the Atitlán (giant pied-billed) grebe, is found; this species, classified as endangered, has been protected by law since 1970. There are more than 900 other species of native and migratory birds. Reptiles, present in more than 204 species, include the bushmaster, fer-de-lance, water moccasin, and iguana.
Guatemala's main environmental problems are deforestation—over 50% of the nation's forests have been destroyed since 1890—and consequent soil erosion. As recently as 1993, the nation obtained 90% of its energy from wood, losing 40,000–60,000 hectares of forest per year. Between 1965 and 1990, Guatemala also lost over 30% of its mangrove area, which totaled 16,000 hectares in the early 1990. From 1990–2000 the rate of deforestation was about 1.7% per year. In 2000, about 26.3% of the total land area was forested.
The nation's water supply is at risk due to industrial and agricultural toxins. Guatemala has 27.8 cu mi of water with 74% used for agriculture and 17% used in farming activity.
United Nations sources show that environmental contamination is responsible for a significant number of deaths due to respiratory and digestive illnesses. Despite the establishment in 1975 of a ministerial commission charged with conserving and improving the human environment, coordination of antipollution efforts remains inadequate, and Guatemala still suffers from a lack of financial resources and well-trained personnel to implement environmental control programs.
In 2003, 20% of Guatemala's total land area was protected. Tikal National Park is a UNESCO World Heritage Site and there are four Ramsar wetland sites. According to a 2006 report issued by the International Union for Conservation of Nature and Natural Resources (IUCN), threatened species included 7 types of mammals, 10 species of birds, 10 types of reptiles, 74 species of amphibians, 14 species of fish, 2 species of invertebrates, and 85 species of plants. Endangered or extinct species in Guatemala included the horned guan, Eskimo curlew, California least tern, green sea turtle, hawksbill turtle, olive ridley turtle, spectacled caiman, American crocodile, and Morelet's crocodile.
The population of Guatemala in 2005 was estimated by the United Nations (UN) at 12,701,000, which placed it at number 69 in population among the 193 nations of the world. In 2005, approximately 4% of the population was over 65 years of age, with another 42% of the population under 15 years of age. There were 95 males for every 100 females in the country. According to the UN, the annual population rate of change for 2005–10 was expected to be 2.8%, a rate the government viewed as too high. Although the government implemented programs that provide access to subsidized contraception, only 31% of women used modern contraception and the fertility rate remained high at 4.9 births per woman. The projected population for the year 2025 was 19,962,000. The population density was 117 per sq km (302 per sq mi). Most of the population is concentrated in the southern third of the country.
The UN estimated that 39% of the population lived in urban areas in 2005, and that urban areas were growing at an annual rate of 3.27%. The capital city, Guatemala City, had a population of 951,000 in that year. Other large cities and their estimated populations are Quezaltenango, 250,000, and Escuintla, 68,000.
Because of persecution and civil war, Amerindian peasants began emigrating across the Mexican border in 1981. Under the CIRE-FCA plan (International Conference on Central American Refugees), 18,000 Guatemalans repatriated between 1989 and 1994. In 1995, 9,500 repatriated from Mexico, and in 1996, another 3,974 repatriated from Mexico. In 1997, there were still 40,000 in Mexico and Belize. Between 1984, when the first repatriation movements took place, and 1999, a total of 43,663 refugees had returned to more than 160 communities throughout Guatemala. The Guatemalan government spent some $30 million on 36 farms purchased for collective returns. In 2004 there were 656 refugees, 4 asylum seekers, and 8 returned refugees. A population that remained of concern to the United Nations High Commissioner for Refugees (UNHCR) at the end of 2004 was 660 persons in Guatemala City.
In 2003 remittances were $2 billion. In 2005, the net migration rate was -1.63 migrants per 1,000 population, down from 4.3 per 1,000 in 1990. The government views the migration levels as satisfactory.
Guatemala has a larger proportion of Amerindians in its total population than any other country in Central America. In 2004, persons of mixed Amerindian and Spanish ancestry, called mestizos, constituted about 59.4% of the national total. Amerindians who have become assimilated and no longer adhere to a traditional Amerindian life-style are also called ladinos, but this term is sometimes used to refer to mestizos. There are at least 22 separate Mayan groups, each with its own language. The largest minority groups include the Quiché (9.1%), the Cakchiquel (8.4%), the Mam (7.9%), and the Q'equchi (6.3%). Other Mayan groups account for about 8.6% of the population. The Garifuna are de scendants of African slaves. The white population is estimated at less than 1% of the total.
Spanish, spoken by about 60% of the population, is the official and commercial language. Amerindians speak some 28 dialects in five main language groups: Quiché, Mam, Pocomam, and Chol—all of the Mayan language family—and Carib, Kekchi, Garifuna, Cakchiquel, and Xinca. Amerindian languages are spoken by about 40% of the populace. A 2003 Law of Languages mandates the use of Mayan languages in public sectors such as health, education, and justice.
Historically, Roman Catholicism is the predominant religion (between 50–60%), with an archbishopric at Guatemala City and bishoprics at Quezaltenango, Verapaz, and Huehuetenango. Many inhabitants combine Catholic beliefs with traditional Mayan rites. Protestants account for about 40% of the population. The largest Protestant denominations are the Full Gospel Church, the Assembly of God, the Church of God of the Central American Church, and the Prince of Peace Church. Other denominations represented are Presbyterians, Baptists, Lutherans, Episcopalians, the Church of Jesus Christ of Latter-Day Saints, and Jehovah's Witnesses. Minority groups and religions with small communities include Jews, Muslims, and followers of the Indian spiritual leader Sri Sathya Sai Baba.
A 1995 Agreement on the Identity and Rights of Indigenous Peoples was approved to provide freedom of practice and promote respect for the forms of spirituality practiced by the Maya, Garifuna, and Xinca groups. As of 2005, however, very little had been done to implement the agreement. Though there is no official religion, the constitution recognizes the Catholic Church as a distinct legal personality. Other religious groups must register with the government in order to make legal business transactions. Some tension exists between Christian groups and the indigenous Mayan religious groups. The Interreligious Dialogue and Foro Guatemala are groups that encourage tolerance and cooperation between indigenous and Christian faiths. The Ecumenical Forum for Peace and Reconciliation is a group of primarily Christian leaders who conduct public conferences and debates on a variety of social and political topics.
In 2002, the total length of Guatemala's road system was estimated at 13,856 km (8,610 mi), of which 4,370 km (2,715 mi) was paved, including 140 km (87 mi) of expressways. In 2003, there were approximately 127,800 passenger cars and 145,900 commercial vehicles registered. Two international highways cross Guatemala: the 824-km (512-mi) Franklin D. Roosevelt Highway (part of the Pan American Highway system) and the Pacific Highway. Guatemala Railways operates 90% of the nation's 884 km (549 mi) railroad system, all of it narrow-gauge.
Few of the rivers and lakes are important to commercial navigation. Of the 990 km (615 mi) only 260 km (161 mi) are navigable year round, an additional 730 km (454 mi) are only navigable during high water. Puerto Barrios and Santo Tomás on the Caribbean coast are Guatemala's chief ports. The Pacific coast ports are Champerico and San José. In 2002, Guatemala had no registered cargo ships.
There were an estimated 452 airports in 2004, but only 11 had paved runways as of 2005. La Aurora International Airport at Guatemala City, the first air terminal in Central America, serves aircraft of all sizes, including jumbo jets. The government-owned Aviateca has a monopoly on scheduled domestic service and also flies to other Central American countries, Jamaica, Mexico, and the United States. In 1998, (the latest year for which data was available) 508,000 passengers were carried on scheduled domestic and international flights.
Three distinct stages—Mayan indigenous, Spanish colonial, and modern republican—have left their mark on the history of Guatemala.
Guatemala includes much of the old Mayan civilization, which may date back as early as 300 bc. The classical Mayan period lasted from about ad 300 to 900 and featured highly developed architecture, painting, sculpture, music, mathematics (including the use of zero), a 365-day calendar, roads, and extensive trade. This great pre-Columbian civilization seems to have collapsed around ad 900, and by the 12th century, the Mayas had disintegrated into a number of separate Amerindian groups. The Amerindians offered resistance to the Spanish expedition sent by Hernán Cortés from Mexico and led by Pedro de Alvarado during 1523–24, but by the end of that time, their subjugation to Spain was virtually complete.
Alvarado founded the first Guatemalan capital, Santiago de los Caballeros de Guatemala, in 1524. Because of several earthquakes, the capital was moved a number of times until it became permanently established at Guatemala City in 1776. From 1524 until 1821, Guatemala (City and province) was the center of government for the captaincy-general of Guatemala, whose jurisdiction extended from Yucatán to Panama. Economically, this was mainly an agricultural and pastoral area in which Amerindian labor served a colonial landed aristocracy. The Roman Catholic religion and education regulated the social life of the capital. Spanish political and social institutions were added to Amerindian village life and customs, producing a hybrid culture.
In 1821, the captaincy-general won its independence from Spain. After a brief inclusion within the Mexican Empire of Agustín de Iturbide (1822–23), Guatemala, along with present-day Costa Rica, El Salvador, Honduras, and Nicaragua, formed the United Provinces of Central America in 1824. This federation endured until 1838–39, but was fragmented by liberal and conservative divides. Guatemala proclaimed its independence in 1839 under the military rule of the conservative Rafael Carrera, an illiterate dictator with imperial designs. Though the people went through three different pushes for independence, representative democracy was the exception from the mid-19th century until the mid-1980s. The country passed through dictatorships, military rule, insurgencies (in the 1960s), and coups.
After Carrera died (without reaching his dictatorial goals), Guatemala fell under a number of military governments. These included three notable administrations: Justo Rufino Barrios (1871–85), the "Reformer," who ruled through the transition from the colonial to the modern era; Manuel Estrada Cabrera (1898–1920), whose early encouragement of reform developed later into a push for increased power; and Jorge Ubico (1931–44), who continued, and elaborated upon, the programs begun by Barrios.
Guatemalan politics changed with the election of reform candidate Juan José Arévalo Bermejo in 1945. Arévalo's popularity marked one of the first mass-based movements in Guatemalan politics. In 1951, Jacobo Árbenz Guzmán was elected. Following Arévalo's approach to land reform, Árbenz expropriated holdings of the United Fruit Co., a US firm. The United States alleged communist influence within the Árbenz government, and began mobilizing opposition against him. In the summer of 1954, Col. Carlos Castillo Armas and an army of Guatemalan exiles, backed by the CIA, invaded Guatemala from Honduras and toppled Árbenz. Castillo took over, restored expropriated properties, and ruled by decree until he was assassinated by a presidential palace guard in July 1957.
After a period of confusion, Gen. Miguel Ydígoras Fuentes became president in January 1958. His administration was essentially a military dictatorship, even though he claimed to follow democratic principles. He was particularly hard on his domestic critics, denouncing them as communists. He was equally bombastic on the international stage, denouncing the United States, quarreling with Mexico over fishing rights, and challenging the United Kingdom over Belize. He was also contemptuous of Fidel Castro, and allowed Guatemala to be a training area for the exiles in the abortive US invasion of the Bay of Pigs in April 1961.
In March 1963, Ydígoras was overthrown by Defense Minister Col. Enrique Peralta Azurdia, who declared a state of siege. For two years, Peralta ruled dictatorially, and continued to assert Guatemala's claims on Belize. In September 1965, the Peralta regime announced a new constitution and elections, and in March 1966, Dr. Julio César Méndez Montenegro was elected president. He was the first civilian president since Árbenz, and would be the last for some time. During his term, the army and right wing counter-terrorists proceeded to kill hundreds of guerrillas, who were believed to be sponsored by Cuba, and claimed destruction of the guerrilla organization by the end of 1967. Uprooted from the countryside, the guerrillas concentrated their efforts on the capital, where, in 1968, guerrillas assassinated US Ambassador John G. Mein.
Guatemala returned to military rule as Col. Carlos Arana Osorio was elected president in 1970. He instituted the country's first comprehensive development plan, but the plan was upset by guerrilla violence, which now engulfed the country. Ambassador Karl von Spreti of the Federal Republic of Germany (FRG) was murdered in April 1970 by leftists. Many prominent Guatemalans were killed or held for ransom. In response to the violence, Arana suspended civil liberties from November 1970 to November 1971. In 1974, Arana's candidate, Gen. Kjell Laugerud García, was confirmed by Congress as president, after an election marred by charges of fraud. Laugerud followed a centrist policy and obtained a measure of popular support. During his tenure, guerrilla violence decreased, and some political liberties were restored. The principal challenge to Laugerud's administration was the need to rebuild Guatemala after the catastrophic earthquake of February 1976.
A militant rightist, Gen. Fernando Romeo Lucas García, was elected president in 1978. As guerrilla violence continued, there was also an upsurge of activity by right wing "death squads," which, according to unofficial Guatemalan sources, committed over 3,250 murders in 1979 and even more during 1980. In addition, hundreds of Amerindians were reportedly massacred during antiguerrilla operations. The Carter administration objected to Guatemala's deteriorating human rights record, whereupon the military charged that communist influence had reached the White House.
In January 1981, the main guerrilla groups united and escalated while the government went into crisis. The elections of March 1982 were won by Laugerud's handpicked candidate, Gen. Angel Aníbal Guevara. Three weeks later, a coup placed in power a "born-again" Protestant, Gen. José Efraín Ríos Montt. After his month-long amnesty offer to the guerrillas was rejected, he declared a state of siege in July, and the antiguerrilla campaign intensified. The government's counter-insurgency killed between 2,600 and 6,000 in 1982, and drove up to a million Guatemalans from their homes by the end of 1983. In March 1983, Ríos lifted the state of siege and announced that elections for a constituent assembly would be held in July 1984. But Ríos, who had fought off some 10 coup attempts during his administration, was overthrown in August 1983.
The new government of Brig. Gen. Oscar Humberto Mejía Victores declared that the coup was undertaken to end "abuses by religious fanatics" and pledged continued efforts to eradicate the "virus of Marxism-Leninism." Elections for a constituent assembly were held, as promised, in July 1984. In May 1985, the assembly promulgated a constitution for a new government with an elected Congress. The general elections of November 1985 were followed by a runoff election in December. The overwhelming winner was Mario Vincio Cerezo Arévalo of the Guatemalan Christian Democratic Party (DCG). He also brought a majority into Congress. Political violence decreased under Cerezo, who withstood two attempted coups. But he was unable to make any progress on human rights in Guatemala, and was unwilling to risk prosecution of military personnel who had been the most serious violators. As the economy worsened, political instability increased, including violence.
The elections of 11 November 1990 necessitated a runoff election, which was won by Jorge Serrano of the Movement for Solidarity and Action (Movimiento para Acción y Solidaridad—MAS). Serrano's inauguration in January 1991 marked the first transition in memory from one elected civilian government to another. Serrano promised to negotiate with insurgents and bring to justice both corrupt former officials and human rights violators, but was deposed by the military after he declared a state of emergency and suspended the constitution on 25 May 1993. The military, in unusual service in defense of democracy, then allowed Congress to name Ramior de Serrano's successor. This unusual service of the military in defense of democracy led to the naming of Ramior de León Carpio as president on 5 June. De León, a human rights advocate, promised to bring to justice those responsible for the dismal state of human rights in Guatemala. He also proposed reductions in the military, which predictably were not well-received by the officer corps.
On 29 December 1996, under the government of Alvaro Arzu, the Guatemalan government signed a peace accord with the guerrilla Guatemalan National Revolutionary Unity. This signaled the end of Central America's longest-running guerrilla war, beginning with an informal cease-fire in March 1996, and the signing of the socioeconomic accord (which called for the government to raise its tax revenues from 8% to 12% of GDP and increase its spending in health, education, and housing). The last accord, signed in Mexico City in September 1996, called for legislative and judicial reforms. It also included a reassessment of the military's role, as the parties agreed to remove the army from public security functions and to annul the law that provided for the Civil Defense Patrols established in the 1980s to fight guerrillas in the highland villages.
In February 1999, the country's Historical Clarification Commission blamed the army for more than 90% of the deaths or disappearances of more than 200,000 Guatemalans during the 36-year civil war. In many instances, the army committed genocide against entire Mayan villages, the report concluded. The three-member commission blamed the United States government for supporting right wing regimes even though it knew about the atrocities being committed by the army. An earlier report by the Catholic Church revealed similar findings. During a short visit to Guatemala in March 1999, US president Bill Clinton said his country had been wrong for supporting the Guatemalan army. He pledged to support the peace process. In May, the peace process suffered a setback when Guatemalans rejected 50 key constitutional reforms that would have diminished the role of the army and given protection and recognition to Amerindian languages and traditional customs, in a vote in which only about 20% of Guatemalans took part.
In November of 1999, a populist lawyer named Alfonso Portillo captured 47.8% of the vote in the presidential election. This vote was not enough to prevent a runoff election (held a month later), which was unsurprising as Portillo was a very controversial candidate. Portillo had fled Mexico in 1982 to avoid what he termed unfair prosecution for the killing (in self-defense) of two men in Guerrero. Further, he was also associated with former dictator Rios Montt (whose 17-month regime in 1982–83 committed some of the worst atrocities against Amerindians) through membership in the conservative Guatemalan Republican Front (FRG). Ríos Montt, who had his eye set on the presidency in 2003, worked closely with Portillo as FRG's secretary general. Portillo built support with promises to reduce crime, one of the worst problems facing the nation after the war. Crime was rampant throughout the nation, with dramatic increases in murders, kidnappings, and armed robbery. Portillo also promised to aid the poor and curb unemployment, a message that did not go unheard in a nation where 64% of Guatemalans are unemployed or underemployed. In the December runoff election, Portillo captured 68.3% of the vote to win the presidency. His party captured 63 of 113 seats in Congress, while the conservative PAN won 37 seats. A leftist coalition captured nine seats.
Montt attempted to overturn a constitutional ban preventing former coup plotters from running for public office, but he failed to overturn the ban in 1999. It was widely speculated that, in the midst of meager economic growth, a 60% poverty rate, and increasing levels of crime and violence, Montt's tough-on-crime stance would be able to convince the Guatemalans to give him a second chance. However, Montt was defeated in the first round of voting, as he was only able to win 19.3% of the vote. The former Guatemala City mayor, Oscar Berger Perdomo won 54.1% of the vote as the Grand National Alliance (GANA) candidate. Alvarado Colom Caballeros, a center-left candidate of the National Unity for Hope (UNE) party, garnered 49.1% of the vote. Though there were fears that violence and fraud might mar the election, those fears were not realized. Berger Perdomo, a conservative backed by the business class, assumed office on 14 January 2004. Portillo, however, quickly fled Guatemala as news of a corruption scandal in the presidency grew. In October 2005, Guatemala requested that Mexico send Portillo back to face accusations of public funds misuse—specifically, a diversion of about $16 million in military funds.
In his inaugural speech, Oscar Berger Perdomo committed to adherence to the 1996 Peace Accords. However, the UN Verification Mission in Guatemala (MINUGUA) reported that many of the fundamental reforms of the 1996 Peace Accords were not being realized due to persistent racism and social inequality. MINU-GUA predicted that the persistence would lead to an engendered future social conflict, stunted economic development, and corrosion of democratic government. Violence against women, femicide, was also a growing problem in Guatemala, where 527 women, mostly poor, were reportedly raped and murdered in 2004.
Civil war, corruption, and instability are among the reported reasons that Guatemala maintained a 75% poverty rate in 2005. The effects of Hurricane Stan and its concomitant flooding and landslides, claimed thousands of lives in October 2005.
Constitutionally, the Guatemalan government is defined as democratic and representative, and the new constitution that took effect on 14 January 1986 reaffirms that definition. Since the 1950s, however, civil disorder has often prompted the suspension of constitutional guarantees. In October, 1999, Congress approved constitutional reforms that ended the military's constitutional role in internal security except for limited periods and under civilian control.
Guatemala is a republic. The president, who must be a nativeorn lay person at least 40 years old, is elected by direct vote for a four-year term and may not be reelected. The constitution calls for a popularly elected vice president. The office of vice president provides a guarantee of presidential succession in case of the death or disability of the chief executive. There is a five-member court of constitutionality, which officially advises the president. Its members are appointed, one each by the Supreme Court, Congress, the president, the University of San Carlos, and the bar association. The president, who has broad powers, appoints and is assisted by a cabinet. The cabinet members traditionally resign at the end of each year so that the president may choose a new cabinet. The president, who is also commander-in-chief of the armed forces, appoints most military officers, the 22 governors, and other important public and diplomatic officials. Presidential duties include preserving public order, proposing laws, and making an annual presentation of the budget.
The unicameral National Congress has 113 members elected to four-year terms. Ninety-one members are elected from departmental constituencies, while 22 are elected by proportional representation. In districts with a population over 200,000, an additional deputy is elected to represent each additional 100,000 inhabitants or fraction exceeding 50,000. In addition, at-large representatives are elected by proportional representation from lists submitted by each political party. Under the constitution, Congress imposes taxes, enacts the national budget, declares war and makes peace, and ratifies treaties and conventions proposed by the president. Congress elects the president of the judiciary and judges of the Supreme Court and courts of appeals. The president may veto congressional bills, but Congress may override by a two-thirds vote. All public officials must declare the amount of their incomes and property holdings before assuming their posts and after they leave office.
Citizenship is acquired at the age of 18. Voting is obligatory for literate men and women 18 years of age and older and optional for nonliterate citizens.
Political power in Guatemala has been largely a matter of personal, rather than party, influence. Although parties have generally developed along conservative or liberal lines, political periods are commonly identified with the names of important leaders.
Under President Carlos Castillo Armas (1954–57), the Guatemalan Communist Party and other leftist parties were dissolved, and all other parties were temporarily suspended. To prevent further party proliferation, the membership necessary for party certification was raised from 10,000 to 50,000 in 1963. Only three parties were able to meet this requirement in time for the March 1966 elections: the Revolutionary Party (Partido Revolucionario—PR), a center-left party, the conservative Institutional Democracy Party (Partido Institucional Democrático—PID), formed in 1965, and the militantly anticommunist National Liberation Movement (Movimiento de Liberación Nacional—MLN).
During the 1970s, these parties remained dominant. The MLN won the presidency in 1970, and an MLD-PID coalition took the 1974 election (which was ultimately decided in Congress), defeating Gen. José Efraín Ríos Montt, representing the leftist National Opposition Front, a coalition of the several parties, including the Christian Democrats (Partido de Democracía Cristiana Guatemalteca—DCG). In 1978, the PR and PID formed a center-right coalition. In the congressional voting, the MLN won 20 seats, the PID 17, the PR 14, the DCG 7, and other parties 3. In the presidential elections of March 1982, a coalition of the PR, PID, and the National Unity Front (Frente de Unidad Nacional—FUN), an extreme right wing party formed in 1977, won a plurality of 38.9% of the vote. Congress endorsed the PR-PID-FUN candidate, Gen. Ángel Aníbal Guevara, as president, but he was deposed in a coup later in March. All parties were suspended by the new ruler, Gen. Ríos, but political activity resumed in March 1983. In the 1980s, the Christian Democrats grew significantly, winning the 1985 presidential and congressional elections. In addition, a host of new parties entered the political arena. Many had hopeful names suggesting national reconciliation, moderation, and solutions to Guatemala's problems. Among these were the National Union of the Center (Unión del Centro Nacional—UCN), the Democratic Party for National Cooperation (Partido Democrático de Cooperación Nacional—PDCN), the Solidarity Action Movement (Movimiento para Acción y Solidaridad—MAS), the National Advancement Plan (Plan por el Adelantamiento Nacional), and the National Authentic Center (Centro Auténtico Nacional).
The left wing guerrilla movement is represented by the Guatemalan National Revolutionary Unity (Unidad Revolucionaria Nacional Guatemalteca—URNG). Founded in 1982, these groups consist of the Guerrilla Army of the Poor (Ejército Guerrillero de los Pobres—EGP), the Guatemalan Workers' (Communist) Party (Partido Guatemalteco del Trabajo—PGT), the Rebel Armed Forces (Fuerzas Armadas Rebeldes—FAR), and the Organization of the People in Arms (Organización del Pueblo en Armas—ORPA). During the 1999 elections, the leftists won nine seats in Congress. The main political parties in 1999 were the conservative Frente Republicano Guatemalteco and Partido de Avanzada Nacional; Frente had 63 seats in Congress and PAN had 37 seats.
In the November 2003 elections, the Grand National Alliance (GANA) won 49 of the 140 seats in Congress; the FRG won 42 seats; the National Unity for Hope (UNE) won 33 seats; and PAN took 16. In the November and December 2003 presidential elections, Óscar Berger Perdomo of the Grand National Alliance won both the first and second rounds of voting to become president. His opponent, Caballeros, won 49.1% of the vote. The next legislative and presidential elections were scheduled for November 2007.
Guatemala is divided into 22 departments, plus Guatemala City, each with a governor appointed by the president. Municipalities are governed by a mayor and independent municipal councils whose officials are popularly elected for two-year terms.
The Constitution of 1985 established an independent judiciary and a human rights ombudsman. Courts of ordinary jurisdiction are the nine-member Supreme Court, 10 courts of appeals, 33 civil courts of first instance, and 10 penal courts of first instance. There is also a Constitutional Court. Judges of the Supreme Court and courts of appeals are elected for four-year terms by the National Congress from lists prepared by active magistrates, the Bar Association, and law school deans. Judges of first instance are appointed by the Supreme Court. Courts of private jurisdiction deal separately with questions involving labor, administrative litigation, conflicts of jurisdiction, military affairs, and other matters. An independent tribunal and office of accounts supervises financial matters of the nation, the municipalities, and state-supported institutions, such as the National University.
In 1986, under Cerezo's civilian government, reforms were added in the effort to end political violence and establish rule of law. These included amparo (court ordered protection), new laws of habeas corpus, and a series of Supreme Court reforms to fight corruption and make the legal system more efficient. However, the government was criticized for still failing to investigate and prosecute human rights violations throughout the rest of Cerezo's term.
A new criminal procedural code affording stronger due process protections took effect in July 1994. Trials are public. Defendants have the rights to counsel, to be presumed innocent, and to be released on bail.
In 2001, there was some concern that intimidation would stop justice, specifically in regards to the prosecution of the Bishop Gerardi murder. In this trial, retired army and foreign intelligence chief Col. Disrael Lima and his son Capt. Byron Lima were charged for murder along with former member of the Presidential Guard (EMP) Ogdulio Villanueva, among others. Archbishop Gerardi was beat to death two days after the Restoration of Historical Memory (REMHI) report was released by the human rights office (ODHA) that he headed. The report blamed the military and paramilitary for Guatemala's 36-year long civil war and the majority of deaths that occurred during that time. The reopening of the trial in 2001 was met by a bomb attack against Judge Iris Yassmin Barrios the night before the reopening of the Gerardi trial. Several witnesses died suspiciously, and judicial officials, judges, and prosecutors backed out of participation in the case due to threats and surveillance.
In 2004, Guatemala's judiciary was still said to suffer from corruption, inefficiency, intimidation, and the de facto doling out of impunity, despite its legal independence. Furthermore, military courts retain control of military personnel who commit crimes while on official business, thus disallowing civil courts to try human rights abuses by the military.
The consequently incomplete justice under the formal judicial system has been a reason that some citizens have taken justice into their own hands through the carrying out of linchamientos in vigilante groups that attack war criminals and others accused of war crimes. According to MINUGUA, an average of one lynching per week was carried out between April 1997 and May 1998, usually in rural areas lacking substantive police presence and where civil patrols had once been prevalent. Former patrollers, ironically, were often involved in the instigation of attacks.
Some outside courts have attempted to give justice where Guatemalan courts have had less progress. The Inter-American Court of Human Rights ordered that the state pay compensation to victims of human rights abuses committed by the state. In December, 2004, $3.5 million was paid. The court found the state specifically responsible for the 1982 massacre of 268 people in Plan de Sanchez, Rabinal, and Baja Verapaz. The Constitutional Court, in 2005, also rejected the proposal to create a UN Commission for the Investigation of Illegal Bodies and Clandestine Security Apparatus, saying it would be unconstitutional and that alternative methods of protecting human rights from state aggression would be carried out. It also questioned the legality of Guatemala's accepting the jurisdiction of the Inter-American Court of Human Rights. An attorney with close ties to the military sought this ruling. Incidentally, Guatemala had not accepted compulsory ICJ jurisdiction, either, as of 2004.
The World Bank invested in a Judicial Reform Project aiming to create a more effective, accessible and credible judicial system that would improve consistency, equity, public trust, and confidence in its judging of the law.
The Guatemalan national armed forces (29,200 active and 35,200 reservists in 2005) are combined for administrative purposes, with the Army providing logistical support to the Navy and Air Force. In 2005 the Army had 27,000 active personnel, while there were 1,500 in the Navy, and 700 in the Air Force. The Army's primary armament included 12 light tanks, 57 reconnaissance vehicles, and over 118 artillery pieces. The Navy's major units consisted of 31 coastal patrol craft and 1 amphibious landing craft. The Air Force had 10 combat capable aircraft, including 4 fighter ground attack aircraft, in addition to 21 utility helicopters. Paramilitary forces included a 19,000 member national police force, in addition to a 2,500 member Treasury Police force. The defense budget in 2005 totaled $101 million. A decree promulgated in December 1983 authorized military service for women.
Guatemala is a charter member of the United Nations, having joined on 21 November 1945; it participates in ECLAC and several other UN specialized agencies, such as the FAO, ILO, IMF, UNESCO, UNIDO, WHO, and the World Bank. It is one of five members of the Central American Bank for Economic Integration (BCIE) and the Central American Common Market (CACM). The country also belongs to G-24, G-77, the Latin American Economic System (LAES), OAS, the Association of Caribbean States (ACS), and the Río Group. In 2004, Guatemala, the United States, Costa Rica, El Salvador, Honduras, Nicaragua, and the Dominican Republic signed the US Central America Free Trade Agreement (CAFTA). The agreement must be ratified by all participating countries before it enters into force. Guatemala has observer status in the Latin American Integration Association (LAIA). Guatemala was a founding member of the Central American Parliament (PARLACEN).
Guatemala is part of the Nonaligned Movement and is a signatory of the 1947 Río Treaty, an inter-American security agreement. The country is also part of the Agency for the Prohibition of Nuclear Weapons in Latin America and the Caribbean (OPANAL). In environmental cooperation, Guatemala is part of the Antarctic Treaty, the Basel Convention, the Convention on Biological Diversity, Ramsar, CITES, the London Convention, the Kyoto Protocol, the Montréal Protocol, MARPOL, the Nuclear Test Ban Treaty, and the UN Conventions on the Law of the Sea, Climate Change, and Desertification. Guatemala is also signatory to the Central American-US Joint Declaration (CONCAUSA).
Since the Spanish conquest, the economy of Guatemala has depended on the export of one or two agricultural products. During the colonial period, indigo and cochineal were the principal exports, but the market for them was wiped out by synthetic dyes in the 1860s. Cocoa and essential oils quickly filled the void. Coffee and bananas were introduced later, and in 1999, the chief exports were coffee, sugar, and bananas. Guatemala's economy, the largest in Central America, is dominated by the private sector, which generates nearly 90% of GDP. Since World War II, the government has encouraged light industrial production (such as tires, clothing, and pharmaceuticals). Nevertheless, in 1995, agricultural pursuits occupied 58% of the national labor force and accounted for some two-thirds of Guatemalan foreign exchange earnings. Living standards and personal income remain low, and no significant domestic market exists, except for subsistence crops. However, the agricultural-based structure of the economy has been changing slowly since about 1980, morphing into a country that is more services-based and focused on commerce and financial services. As of 2004, commerce was the largest sector in the economy, accounting for approximately 25% of GDP; agriculture comprised 22.8% of GDP. Manufacturing accounted for 12.6% of the GDP.
The economy boomed from 1971 thorough early 1974. Then, as a result of inflation (21.2% in 1973), the world energy crisis, and an annual population growth of 2.9%, the economic growth rate slowed from 7.6% for 1973 to 4.6% for 1974. During the second half of the 1970s, Guatemala's economic performance slowed further; during 1974–80, the average annual growth rate was 4.3%. By the early 1980s, the civil war, coupled with depressed world commodity prices, had led to decreases in export earnings and to foreign exchange shortages. The GDP dropped by 3.5% in 1982, the first decline in decades, and the GDP declined or was stagnant through 1986. The annual inflation rate, which averaged 11% during 1979–81, dropped to no more than 2% in 1982. It rose thereafter, reaching 31.5% in 1985 and about 40% in the first half of 1986.
In the 1990s the Guatemalan economy grew at a healthy pace, propelled by nontraditional exports and investment. Inflation was reduced through fiscal and monetary policies to an average of 12% in 1993. Economic growth accelerated to an estimated 5.0% in 1993 compared with 4.6% in 1992. In a sudden shift that was perceived as a recession by the private sector, GDP growth decelerated in 1996 to 3.1%. The slowdown reflected a combination of factors: windfall profits from coffee exports, a slowdown in most Central American countries causing a significant decline in Guatemalan exports, and a severe competition of domestic products by Mexican imports. In addition, domestic demand cooled off as private sector credit demand ran out of steam, and tax increases were designed to strengthen the fiscal situation ahead of the signing of the peace accords. Growth for 1997 had improved to 4% thanks to greater domestic and trade liberalization; despite Hurricane Mitch, which destroyed a large portion of the country's agricultural produce for the year, GDP growth reached 5% in 1998.
Real GDP growth remained steady throughout 2001–05, between 2–3%. Additionally, inflation remained under 10% for the 5-year period.
The US Central Intelligence Agency reported that Guatemala was still struggling with an appalling poverty rate—75% of the population lived beneath the poverty line as of 2004. The unemployment rate was estimated at 7.5% in 2003, and GDP per capita was estimated at $4,200 in 2004. In 2004, there remained an estimated 250,000 internally displaced persons, indicative of the continued negative influence of prior conflict on the current economy.
The US Central Intelligence Agency (CIA) reports that in 2005 Guatemala's gross domestic product (GDP) was estimated at $62.8 billion. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange based on current dollars. The per capita GDP was estimated at $4,300. The annual growth rate of GDP was estimated at 3.1%. The average inflation rate in 2005 was 9.1%. It was estimated that agriculture accounted for 22.8% of GDP, industry 19.1%, and services 58.1%.
According to the World Bank, in 2003 remittances from citizens working abroad totaled $2.147 billion or about $175 per capita and accounted for approximately 8.7% of GDP. Foreign aid receipts amounted to $247 million or about $20 per capita and accounted for approximately 1.0% of the gross national income (GNI).
The World Bank reports that in 2003 household consumption in Guatemala totaled $22.25 billion or about $1,809 per capita based on a GDP of $24.7 billion, measured in current dollars rather than PPP. Household consumption includes expenditures of individuals, households, and nongovernmental organizations on goods and services, excluding purchases of dwellings. It was estimated that for the period 1990 to 2003 household consumption grew at an average annual rate of 4.0%. It was estimated that in 2004 about 75% of the population had incomes below the poverty line.
In 2005 Guatemla's labor force was estimated at 3.76 million. As of 2002, it was divided among the following sectors: agriculture 38.7%; industry 20%; services 37.5%; with 3.9% in other undefined occupations. As of 2003, the unemployment rate was estimated at 7.5%.
The trade union movement was born at the end of World War II. Directed in part by foreign communist labor leaders and cultivated by a sympathetic administration, the labor movement grew in the next 10 years to a force claiming nearly 500 unions with 100,000 members. With the overthrow of the Árbenz government in 1954, however, the unions were dissolved. After slow reorganization, the trade unions numbered about 110 by 1974, but in 1979 and 1980, trade union activity was severely restricted. In 1992, the Labor Code of 1947 was amended to facilitate freedom of association, to strengthen the rights of working women, to increase penalties for violations of labor laws, and to enhance the role of the Labor Ministry and the courts in enforcement. Approximately 2% of the workforce were union members in 2002. Unions are independent of government and political party domination, however retaliation against union participation is common. Workers dismissed for union activity have little legal or administrative redress. Workers have the right to strike, but it is weakened by legal restrictions and the force of tradition in a country where strikes were illegal until recently.
The workweek is statutorily recognized as being 44 hours long, but most workers work longer hours out of economic necessity. The minimum legal age to work is 14 but child labor remains a huge problem particularly in agriculture and in the informal economy. Hazardous conditions for child laborers are common especially in the fireworks industry. The minimum wage as of 2002 was $3.57 per eight-hour day for industrial workers and $3.24 per day for agricultural workers. There is routine noncompliance of the minimum wage law in the rural areas.
In 2003, only about 18.9% of the total land area of Guatemala was used for the production of annual or perennial crops, although almost two-thirds is suitable for crop or pasture use. Agriculture contributes about 23% to GDP, makes up 48% of export earnings, and employs 46% of the labor force. The principal cash crops are coffee, sugar, bananas, and cotton, followed by hemp, essential oils, and cacao. Coffee is grown on highland plantations; most of the bananas are produced along the Atlantic coastal plain. Cash crop output in 2004 included 18,000,000 tons of sugarcane, 216,000 tons of coffee, 1,000 tons of cotton, and 1,000,000 tons of bananas. Subsistence crop production included 1,072,000 tons of corn and 97,000 tons of dry beans, along with rice, wheat, and fruits and vegetables. Nontraditional agricultural exports have greatly increased in recent years; such products include: lychee, rambutan, melon, papaya, mango, pineapple, broccoli, okra, snow peas, celery, cauliflower, asparagus, garlic, spices and nuts, and ornamental plants. Guatemala's trade deficit in agricultural products was $454.5 million in 2004.
An agrarian reform law of 1952 provided for government expropriation of unused privately owned agricultural lands, with the exception of farms of 91 hectares (225 acres) or less and those up to 273 hectares (675 acres) if two-thirds of the acreage was under cultivation. By 1954/55, 24,836 hectares (61,371 acres) had been distributed to 10,359 farmers. The law of 1952 was supplemented by an agrarian reform law of 1956, which aimed to distribute state-owned farms (fincas nacionales) to landless peasants. From 1954 to 1962, the government distributed 17,346 land titles. In 1962, the National Agrarian Improvement Institute was created to provide assistance to the new landowners and to improve their living standards. The government requires plantation owners to set aside land for the raising of subsistence crops for their tenants. An agrarian credit bank provides loans to small farmers. Some of the land farmed by Amerindians is held in common by groups of families and is never sold.
Consumption of dairy products and meat is low, despite improvements in stock raising and dairying. The wool industry in the western highlands supplies the famed Guatemalan weavers. Hog and poultry production is ample for domestic consumption. In 2005, there were 2,540,000 head of cattle, 212,000 hogs, 260,000 sheep, 124,000 horses, and 27,000,000 chickens. Guatemala exports poultry, with 155,000 tons of poultry meat and 85,000 tons of eggs produced in 2005. Total cattle numbers continue to fall despite increased illegal imports from Honduras and a decline in illegal exports to Mexico. Depressed beef prices and rising production costs are the main causes of this trend.
Guatemalan waters are rich in fish, including shrimp, snapper, and tuna. The total catch in 2003 was 30,480 tons (up from 6,513 tons in 1991), about 32% of which came from inland waters.
Forests are among Guatemala's richest natural resources; they covered some 26% of the total land area in 2000. The forests in the Petén region yield cabinet woods, timber, extracts, oils, gums, and dyes. Mahogany, cedar, and balsam are important export products, and chicle for chewing gum is another important commodity. In 2004, 16.4 million cu m (579 million cu ft) of roundwood were produced, with 97% burned for fuel. Sawn wood production was 366,000 cu m (12.9 million cu ft) that year. Imports of forestry products exceeded exports by $165.8 million in 2004.
The principal commercial minerals were gold, iron ore, and lead. Production of antimony fell to zero in 1999–2001, from a high of 1,020 tons in 1997, when Guatemala ranked third in Latin America, behind Bolivia and Mexico. Gold, which was mined from the colonial period until the early 20th century, was no longer a major export item. An estimated 4,550 kg was produced in 2003, up from an estimated 4,500 kg in 2002. Rough marble, which ranged in color from white through green, was exported to Mexico and other nearby countries. Deposits of nickel have also been found at Marichaj and Sechol. Barite, bentonite, kaolin, other clays, feldspar, gypsum, iron ore, lime, pumice, salt, limestone, sand and gravel, and silica sand were also produced, primarily for domestic use. Reported deposits of copper, quartz, manganese, uranium, mica, and asbestos awaited exploitation.
Guatemala is the only oil producing country in Central America, but has no refining capacity. Therefore it must import all of its refined petroleum products. Most of the country's oil production lies in its northern jungles along the Mexican border. According to the Oil and Gas Journal, Guatemala has proven oil reserves of 526 million barrels, as of October 2005. Since the end of the civil war in 1996, the government has been granting oil exploration concessions. In March of 2005, a new oil licensing round was initiated, the first since 1997. Two blocks, A6 and A7, with known proven reserves were offered, with two unexplored blocks, Piedras Blancas and Cotcal offered. Production averaged an estimated 19,800 barrels per day in 2004, of which almost all was exported to the United States. In 2002, oil exports totaled an estimated 3,104 barrels per day. Consumption of refined products totaled 64,560 barrels per day in that year. Guatemala has modest natural gas reserves of 1.543 billion cu m as of 1 January 2002, but no production.
Guatemala is Central America's largest producer and consumer of electricity. In 2002, electric power generating capacity came to 1.698 million kW, while total production in that year reached 6.808 billion kWh, of which: fossil fuels accounted for almost 60%; hydropower for 27%; and geothermal/other sources accounted for the rest. Electricity consumption in Guatemala grew at an annual rate of 8.1% from 1993 to 2003. In 2002, electric power demand totaled 5.76 billion kWh. The surplus power generated has made Guatemala a power exporter. In 2002, electric power exports totaled 4.40 million kWh, with imports at 55 million kWh.
Manufacturing and construction accounted for a growing proportion of GDP in 2004. In that year, agriculture accounted for 22.7% of the GDP while industry accounted for 19.5% and services accounted for 57.9%. Guatemalan factories produce beverages, candles, cement, pharmaceuticals, chemicals, cigarettes, foodstuffs, furniture, matches, molasses, rubber goods, shirts, shoes, soap, sugar, textiles, and apparel. More recently established firms produce electrical machinery, refined petroleum products, metal furniture, instant coffee, pasteurized milk, plastic, plywood, aluminum and tires. Handmade woven and leather goods are sold to tourists and exported.
Most of the country's industrial enterprises operate on a very small scale. A small domestic market has traditionally limited Guatemala's industrial potential, although the CACM temporarily broadened the market for the country's exported manufactures. The value of Guatemala's exports more than tripled between 1972 and 1978. During the 1980s, however, the industrial sector declined, partly because of the collapse of the CACM but also because of a shortage of the foreign exchange necessary to purchase basic materials. In the mid-1980s, Guatemalan firms turned to export production as internal demand contracted. The 1986 devaluation of the quetzal raised the cost of imported industrial inputs. During the 1990s, the value added by manufacturing remained at a steady pace, except for during 1996. The manufacturing sector suffered from increased competition from Mexico, often unregistered and untaxed, while export to major neighboring markets was hampered in 1996 by the slowdown in Costa Rica and El Salvador.
In 2002, major manufactures included sugar, clothing and textiles, furniture, chemicals, petroleum, metals, and rubber. Heavy industry included a small steel mill located in Escuintla, and an oil refinery that had a capacity of 16,000 barrels per day. The pharmaceutical industry shrank by 53% in 1998 because several manufacturing companies had moved their businesses to Mexico. Construction, very dynamic during the first half of the 1990s, was affected by falling demand in 1996 and 1997, but grew by about 25% annually in 1998 and 1999. Electricity generation and telephone services continued to grow strongly, while oil production, thanks to a very active development policy, increased by 250% between 1992 and 1998.
Maquila plants have comprised a growing proportion of the manufacturing sector, though they are not as heavy of a proportion as in Mexico, Honduras, or El Salvador. In 1994, maquilas in Guatemala employed 70,000; this number grew to 113,200 in 2004. As of December 2004, 222 maquila plans operated in Guatemala—65.3% were Korean-owned, 27% Guatemalan-owned, and 59.9% US-owned.
In 1987–97, total Guatemalan expenditures on research and development amounted to 0.2% of GDP, with 112 technicians and 104 scientists and engineers per million people engaged in research and development. The Academy of Medical, Physical, and Natural Sciences, headquartered in Guatemala City, dates from 1945. In 1996, Guatemala had learned societies devoted to natural history, pediatrics, and engineering, and research institutes concerned with nuclear energy, industry, and earth sciences. The Institute of Nutrition of Central America and Panama founded in 1949 and administered by the Pan American Health Bureau Organization and the World Health Organization, conducts research and disseminates scientific and technical information. Five universities offer degrees in basic and applied sciences. The National Museum of Natural History is located in Guatemala City.
In 2002, high technology exports by Guatemala totaled $55 million, or 7% of the country's manufactured exports.
Outside the capital city, markets are held on appointed days, and local fairs are held annually. Traders bring their wares on large racks atop buses or by mule, herding animals ahead of them. Prices are not fixed. Although there are some modern, tourist-oriented shops, traditional methods of commerce, with modifications, also prevail in Guatemala City. Franchise stores are beginning to gain acceptance. In 2002, there were about 150 franchising companies with around 450 outlets nationwide. Business hours are weekdays, 8 am to 6 pm; shops also open on Saturday mornings. Normal banking hours in Guatemala City are weekdays, 9 am to 3 pm.
The Guatemalan commodity export market is dominated by coffee, sugar, bananas, and oil. Other main exports are medicinal and pharmaceutical products, vegetables, and cardamom. Nontraditional exports, such as cut flowers, fruits and berries, shrimp, and textile assembly, are of growing importance to the Guatemalan economy.
Most exports go to the United States (55.3% in 2003); they also have increasingly gone to other Central American countries. Guatemala runs a trade surplus with the region, exporting mainly to El Salvador (10.5% of exports), but also to Honduras (7.1%) and Mexico (4.1%). As of 2003, Guatemala imported primarily from
|Korea, Republic of||59.5||85.4||-25.9|
|(…) data not available or not significant.|
the United States (comprising 33.1% of imports), Mexico (9.1%), and South Korea (8.8%). In 2004 Guatemala imported 34% of its imports from the United States, 8.1% from Mexico, 6.8% from South Korea, 6.6% from China, and 4.4% from Japan. Guatemala typically imports fuels, machinery and transport equipment, construction materials, grain, fertilizers, and electricity.
Guatemala signed the Central American Free-Trade Agreement (DR-CAFTA) on 10 March 2005.
Guatemala generally finances its trade deficit through capital inflows. Capital flight caused by regional instability during the 1980s led to large deficits on the overall payments balance and brought foreign exchange reserves down from $709.6 million at the end of 1978 to $112.2 million at the end of 1982. In 1991 and 1992,
|Balance on goods||-3,126.7|
|Balance on services||-68.0|
|Balance on income||-318.1|
|Direct investment abroad||…|
|Direct investment in Guatemala||115.8|
|Portfolio investment assets||21.7|
|Portfolio investment liabilities||-11.0|
|Other investment assets||116.0|
|Other investment liabilities||913.4|
|Net Errors and Omissions||311.4|
|Reserves and Related Items||-550.1|
|(…) data not available or not significant.|
with inflation lowered, private capital inflows were large enough to offset public capital outflows and the current account deficit. As a result, foreign reserves expanded during the 1990s, growing by $559 million. Foreign exchange reserves were over $1 billion from 1997 into 1999. Exports increased by 7.2% in 1997 and by 20.7% in 1998. National income reports do not include the export value added by the textile assembly industry (as they are generally located in the Free Trade Zones), and remittances from Guatemalans living abroad, which help finance the trade deficit.
Guatemala's underdeveloped infrastructure is a hindrance to foreign investment and economic development. A disproportionate share of investment goes to the Guatemala City area, despite rehabilitation of the railway system and investment in highways, telephone service, and electricity.
The US Central Intelligence Agency (CIA) reported that in 2004 exports were approximately $2.9 billion; imports were approximately $7.1 billion, resulting in a trade deficit of approximately $4.2 billion.
The Bank of Guatemala (BANGUAT) is the central bank and the bank of issue. The Monetary Board, an independent body, determines the monetary policy of the country. Associated with the Bank of Guatemala are six other government institutions: The National Mortgage Credit Institute (the official government mortgage bank); two development banks, the National Bank of Agricultural Development and the National Housing Bank; and the National Finance Corp., organized in 1973 to lend funds to industry, tourism, and mining to provide technical assistance. BAN-GUAT intervenes in the foreign exchange market to prevent sharp deviation in the exchange rate. In 1998, the Central Bank spent over $500 million to support the exchange rate, but the currency depreciated by 15% anyway that year.
As of 2002, the formal banking system consisted of 32 private commercial banks, three state banks, and several financial houses. Over 18 international banks are represented in one form or another. The five largest banks control approximately 45% of total assets. Several financial institutions collapsed in 1998 and 1999, prompting the government to bring banks into line with the Basel convention on minimum capital requirements. The government also hopes to make credit more available. The International Monetary Fund reports that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $2.7 billion. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $6.3 billion. The money market rate, the rate at which financial institutions lend to one another in the short term, was 10.6%.
When the Bank of Guatemala was established the Fund for the Regulation of the Bond Market was created to promote security issues. Nevertheless, Guatemalans still tend to prefer tangible investments, and there is no fully developed securities market. The National Stock Exchange of Guatemala (the Bolsa Nacional de Valores—BNV) opened in 1989 where shares from private companies in the country and other securities are traded. It is the largest of Guatemala's stock exchanges. The other two main exchanges, the Bolsa Nacional Global and the Bolsa Agrícola, merged to form the Corporación Bursatil in 1994. Three government bonds are traded on the exchanges, including CENIVACUS, CERTIBONO, and CDP. The volume traded in 1999 was $5.9 billion.
In Guatemala, worker's compensation (the country's Social Security Plan) is compulsory, providing pension, disability pension, medical and hospital benefits, maternity benefits, and funeral expenses. In addition, the insurance market is entirely domestic, as foreign insurers are prohibited from issuing policies. Market rates, and the types of fire, auto, life, personal accident, and crime insurance are set by the superintendency. In 2003, the value of direct premiums written totaled $271 million, with nonlife premiums accounting for $222 million. The country's top nonlife insurer that same year was G&T, which had gross nonlife written premiums of $55.2 million.
Fiscal policy loosened after the 1985 elections, but tax reforms in 1987 failed to generate additional income, and governmental expenditures continued to grow. By 1990, the public sector deficit was 4.7% of GDP. The Serrano administration transformed the deficit of 1990 to a slight surplus in 1991 and a virtually balanced budget in 1992. The consolidated public sector deficit amounted to 1.2% in 1991 and 1.0% in 1992. Guatemala's public sector is among Latin America's smallest, and the tax burden is one of the lightest, at about 8% of GDP. The budget deficit grew to 2.5% of GDP in 1998, from only 0.50% in 1997, forcing the government to reevaluate its taxation and customs practices. Continued privatization and trade liberalization should boost public finances.
The US Central Intelligence Agency (CIA) estimated that in 2005 Guatemala's central government took in revenues of approximately $3.3 billion and had expenditures of $4.0 billion. Revenues minus expenditures totaled approximately -$667 million. Public debt in 2005 amounted to 26.9% of GDP. Total external debt was $5.503 billion.
|Revenue and Grants||21,694.4||100.0%|
|General public services||5,819.7||22.2%|
|Public order and safety||2,725.1||10.4%|
|Housing and community amenities||2,948.3||11.2%|
|Recreational, culture, and religion||395.2||1.5%|
|(…) data not available or not significant.|
The International Monetary Fund (IMF) reported that in 2003, the most recent year for which it had data, budgetary central government revenues in millions of quetzales were 21,694.4 and expenditures were 26,210.9. The value of revenues in millions of US dollars was $2,732 and expenditures $3,275, based on a market exchange rate for 2003 of 7.9408 as reported by the IMF. Government outlays by function were as follows: general public services, 22.2%; defense, 4.7%; public order and safety, 10.4%; economic affairs, 23.9%; environmental protection, 0.8%; housing and community amenities, 11.2%; health, 7.0%; recreation, culture, and religion, 1.5%; education, 17.6%; and social protection, 0.6%.
The corporate income tax rate in Guatemala is 31% of net income. However, companies operating there have a choice between two payment regimes: a general withholding regime, and an optional tax regime. Under the General regime, a monthly 5% tax on gross income is made. Under the optional regime, a quarterly payment at the 31% corporate rate is made on net taxable income. In addition, there is a 2.5% asset tax that is applied to the previous year's income or net assets. The asset tax is credited against the corporate income tax. An industrial development law provides tax exemptions for new industries. There is also a 3.5% tax on all foreign exchange transactions. Only income earned from Guatemalan sources is taxed. Capital gains, like the corporate income tax, offer two payment regimes: a general withholding regime; and an optional tax regime. Under the first, a 10% monthly withholding rate is applied, while under the second, a quarterly 31% rate is used. Dividends from resident companies are exempt from tax if the income tax was paid out of the income that was distributed as dividends by the distributing company. Otherwise a 10% withholding tax is applied.
The progressive personal income tax schedule has a top rate of 31%. Nonresidents pay a flat 31% rate, while income from employment and professional services is charged at the progressive rate. Other taxes include property taxes, and inheritance and gift taxes. Excise taxes are levied on beverages, cigars, tobacco, gasoline, vehicles, and airline tickets. Royalties are taxed at 31%.
Guatemala's main indirect tax is a 12% value-added tax (VAT) that is applied to most transactions. However, basic foodstuffs, sales of some low-cost housing and certain financial services are exempt. Exports are zero-rated.
Guatemala requires licenses for the importation of restricted goods, including pharmaceuticals, basic food grains, milk, coffee beans, and armaments. As a member of the Central American Common Market CACM, Guatemala adheres to a common tariff classification system as well as a common customs code and regulations. Duties are stated as both specific and ad valorem. Import duties are generally minimal, ranging from 5 to 15%. Imports of agricultural products that exceed the quota have higher rates. There is also a 12% value-added tax (VAT) that is collected at the port of entry.
There are no general requirements for local participation nor any restrictions on repatriation of capital. Guatemala's major diplomatic interests are regional security and, increasingly, regional development and economic integration. Guatemala participates in several regional groups, particularly those related to trade and environment. Foreign investor interest in Guatemala picked up with the signing of peace accords in 1996 and deregulation of the electric and telecommunications sectors. Structural reforms, such as the privatization program and trade liberalization measures, will add to investor appetite, but substantial investment in infrastructure and training the workforce is needed. As of the first quarter of 1997, the government had invited bids for 12 oil exploration and production contracts. Oil production increased by 250% between 1992 and 1998.
In 1998, Guatemala passed the Foreign Investment Law, reducing the barriers to foreign investment. But investment was still restricted to minority ownership of domestic airlines and ground transport. Incentives are available for the forestry, mining, tourism, and petroleum sectors. There are also eight free trade zones. The Foreign Investment Law had also removed limitations to foreign ownership of domestic airlines and ground transport companies in January 2004. There were also plans within the government to form mining legislation in 2005 that would encourage foreign investment.
Guatemala's economic development policy is to create rural employment through the provision of investment incentives. Such enticements include inexpensive financing by government institutions, free assistance and technical support, and preferential treatment to use government facilities and institutions for guidance. The government has initiated a number of programs aimed at liberalizing the economy and improving the investment climate. After the signing of the final peace accord in December 1996, Guatemala was well-positioned for rapid economic growth. Growth in the late 1990s was led by development of petroleum mining and refining.
The country's economy is commanded by the private sector which generates about 85% of GDP. The public sector is small and shrinking, with its business activities limited to transportation, and several development oriented institutions. Problems hindering economic growth include illiteracy and low levels of education; inadequate and underdeveloped capital markets; and lack of infrastructure, particularly in the transportation, communications, and electricity sectors. The distribution of income and wealth remains unequal. The wealthiest 10% of the population receives almost one-half of all income; the top 20% receives two-thirds of all income.
Tax reform was one government objective in 2003, as was reform of the financial services sector, liberalizing trade, and overhauling public finances. Drought and low coffee prices harmed the economy in 2001–02, and caused malnutrition among the poor in rural areas. In 2003, the International Monetary Fund (IMF) approved a nine-month, $120-million Stand-By Arrangement to support Guatemala's economic program through March 2004. In 2003, the government was targeting the fiscal deficit, aiming to control inflation, and working toward putting into place a new legal framework for the financial sector. The country was also improving transparency in government, and working to strengthen governing structures themselves.
A tax reform was passed in June 2004 to supplement the rolledover 2003 budget. Corporate income tax was changed, and excise duties on alcohol were levied. Further, a new corporate tax (the Impuesto Temporal de Apoyo a los Acuerdos de Paz—IETAAP) was made to support peace agreements. This replaced the agricultural and mercantile business tax (Impuesto sobre Empresas Mercantiles y Agropecuarias—IEMA) that was rejected by the Constitutional Court in January 2004 and left the government vulnerable to a shortfall in tax revenue if tax reform were not carried out.
In 2005, the IMF supported President Berger's economic policy program and declared that Guatemala was capable of dealing with potential balance of payments without a new Stand-By Arrangement. The Stand-By Arrangement that gave Guatemala a $120-million credit line ended in 2004.
A social insurance system covers all employees, including agricultural workers. Public employees are covered by a separate program. The pensions for old age, survivorship, and disability are funded by a small contribution from employees, larger contribution from employers, and 25% covered by the government. Retirement is set at age 60. Cash and medical benefits are provided for sickness and maternity for employees of firms with more than five workers. Free medical care is provided for those receiving pensions. A grant for funeral expenses is provided.
Despite legal equality, women are paid significantly less than their male counterparts and are generally employed in low-wage jobs. Some domestic laws also discriminate against women. Women can be charged with adultery, while men can only be charged with a lesser crime. Sexual violence, including domestic violence, is widespread, and most cases go unreported. However, the number of complaints for both rape and spousal abuse has risen in recent years due to the nationwide educational program that has encouraged women to seek help. The police have little training to assist victims of sexual crimes. Sexual harassment is not illegal.
The constitution provides that all persons are free and equal in dignity and rights, and that the government must protect the life, liberty, justice, security, and peace of all citizens. Due to inadequate resources and corruption, however, the government is unable to enforce these provisions.
Guatemala's health care system consists of three sectors: public, private nonprofit, and private for-profit. Health coverage has been estimated to be low, with more than 40% of the population receiving no access to health care services. As of 2004, there were an estimated 89 physicians, 404 nurses, and 18 dentists per 100,000 people. Approximately 4.3% of GDP went to health expenditures. Among the chief causes of death are heart disease, intestinal parasites, bronchitis, influenza, and tuberculosis. Other major causes of death were perinatal conditions, intestinal infectious diseases, and nutritional deficiencies. Malnutrition, alcoholism, and inadequate sanitation and housing also pose serious health problems. Approximately 92% of the population had access to safe drinking water and 85% had adequate sanitation. Malaria rates are high. Guatemala does attempt to vaccinate its children and all routine vaccinations are paid for by the government. It is estimated that the poorest half of the population gets only 60% of the minimum daily caloric requirement. Some steps have been taken to fortify foods with daily vitamin requirements. Currently, sugar is being fortified with vitamin A and wheat flour will be fortified with iron.
The total fertility rate was 4.6 in 2000, a dramatic reduction from 6.5 in 1980. By 2000 the maternal mortality rate had fallen to 55 deaths per 1,000 live births, down from 200 in 1990. In 2005, the infant mortality rate was 32 per 1,000 live births and the overall mortality rate was an estimated 6.7 per 1,000 people as of 2002. The average life expectancy was 69.06 years in 2005. From 1966 to 1992 there were about 140,000 war-related deaths.
The HIV/AIDS prevalence was 1.10 per 100 adults in 2003. As of 2004, there were approximately 78,000 people living with HIV/AIDS in the country. There were an estimated 5,800 deaths from AIDS in 2003.
Political violence and problems associated with poverty have left more than 200,000 Guatemalan children orphaned. Many suffer from psychological problems and malnutrition.
Many of the nation's urban housing units and most of its rural dwellings have serious structural defects and lack electricity and potable water. In 2002, there were about 2,483,458 housing units in the country. Most dwellings were detached houses. Over 50% of all housing are owner occupied. About 24% of all houses are of adobe walls; 50% use concrete blocks. Metal sheeting is the most common material for roofing. Most apartment buildings are made of cement block. The housing need in 2005 stood at about 1.6 million houses and overcrowding, especially in rural area hut dwellings and urban rented rooms, was prevalent.
As of 1995, there were about 205 "squatter" settlements inhabited by homeless or displaced persons. In these settlements, shelters are made of wood, cardboard, or mud, with zinc sheet roofs. A public housing program is supervised by the National Housing Bank. The Ministry of Public Health and Welfare is charged with the improvement of rural dwellings.
Elementary education is free and compulsory for nine years although enforcement is lax in rural areas. Primary school covers six years of study, followed by three years of basic secondary school. Students may then choose a two-year diversified secondary program or a three-year technical school program.
In 2001, about 55% of children between the ages of five and six were enrolled in some type of preschool program. Primary school enrollment in 2003 was estimated at about 87% of age-eligible students. The same year, secondary school enrollment was about 30% of age-eligible students. It is estimated that about 66.5% of all students complete their primary education. The student-to-teacher ratio for primary school was at about 30:1 in 2003; the ratio for secondary school was about 14:1. In 2003, private schools accounted for about 12% of primary school enrollment and 74% of secondary enrollment.
Among Guatemala's six main universities, the Universidad de San Carlos, in Guatemala City, is the most important center of higher learning. The others include Universidad del Valle de Guatemala, Universidad Francisco Marroquin, Universidad Mariano Galvez, Universidad Rafael Landivar, and Universidad Rural. In 2003, about 9% of the tertiary age population were enrolled in some type of higher education program. The adult literacy rate for 2004 was estimated at about 69.1%, with 75.4% for men and 63.3% for women.
As of 1995, public expenditure on education was estimated at 1.7% of GDP.
There are three notable libraries in Guatemala City. The National Library, with about over 350,000 volumes, has collections of Guatemalan and other Central American books and newspapers. The General Archives of Central America has a 100,000-item collection of documents for the three-century colonial period, when Guatemala was the administrative center for the Central American area. The library of the Geographical and Historical Academy of Guatemala (30,000 volumes) is of special value to researchers. The Central American Industrial Research Institute maintains the largest technical library in Central America (36,000 volumes). The Institute of Nutrition in Central American and Panama in Guatemala City maintains an important collection of public health documents. The University of San Carlos library has 205,000 volumes. There are about 64 public libraries that are supervised through the National Library. Another 29 public libraries are sponsored by the Bank of Guatemala.
The Museum of Archaeology and Ethnology (1948) in the capital has an excellent collection of Mayan artifacts, and the Colonial Museum in Antigua contains colonial paintings, woodcarvings, iron and leatherwork, and sculpture. Also in the capital are the National Museum of Fine Arts, the National Museum of History, the Museum of the National Palace, the Popol Vuh Archaeological Museum, and the Center for Conservation Studies, founded in 1981.
Except for a few privately controlled facilities, the government owns and operates the postal, telephone, and telegraph services. The Guatemalan Telecommunications Enterprise provides international radiotelegraph and radiotelephone service. In 2003, there were an estimated 71 mainline telephones for every 1,000 people. The same year, there were approximately 131 mobile phones in use for every 1,000 people.
As of 2000 there were 130 AM and 487 FM radio stations. In 2001, four of the most prominent television stations were all owned by the same Mexican citizen, who has a political preference for the FRG. In 2003, there were an estimated 79 radios and 145 television sets for every 1,000 people. The same year, there were 14.4 personal computers for every 1,000 people and 33 of every 1,000 people had access to the Internet. There were 50 secure Internet servers in the country in 2004.
There were three major daily newspapers in 2004, all published in Guatemala City. They were (with orientation and 2004 circulations): Prensa Libre (moderate liberal, 110,000), Siglo Veintiuno (moderate, 56,000), and La Hora (moderate liberal, 18,000).
The constitution provides for free speech and a free press, though journalists admit that in certain cases fear of reprisals or government pressure leads to self-censorship.
Artisans', consumers', service, and savings and credit cooperatives are grouped in four federations. The major employers' organizations are the General Farmers' Association, the Chamber of Commerce, the Chamber of Industry, and the National Coffee Association.
The Academy of Geography and History of Guatemala promotes the study of Guatemalan history, geography, and culture. There are several associations dedicated to research and education for specific fields of medicine and particular diseases and conditions.
National youth organizations include the Association of University Students, associations of Boy Scouts and Girl Guides, youth rotary clubs, and Junior Achievement of Guatemala. Sports associations promote amateur competition in such pastimes as hiking, football (soccer), tae kwon do, and squash. Volunteer service organizations, such as the Lions Clubs and Kiwanis International, are also present. The Red Cross and Habitat for Humanity are active in Guatemala.
All visitors need a passport and may need a visa depending on nationality. Tourism has rebounded since Guatemala's return to civilian rule in 1986. In 2003, approximately 880,223 tourists arrived in Guatemala. There were 17,519 hotel rooms in 2002 with 44,579 beds and an occupancy rate of 47%. Guatemala's main tourist attractions are the Mayan ruins, such as Tikal; the numerous colonial churches in Guatemala City, Antigua Guatemala, and other towns and villages; and the colorful markets and fiestas.
In 2005, the US Department of State estimated the daily expenses of staying in Guatemala City at $200. Other areas were estimated at $156 per day.
The Rusticatio Mexicana, by Rafael Landívar (1731–93), represents the height of colonial Guatemalan poetry. Outstanding figures of the romantic period were philologist Antonio José de Irisarri (1786–1868); José Batres y Montúfar (1809–44), the author of Tradiciones de Guatemala and many poetical works; and José Milla y Vidaurre (1822–82), a historian and novelist and the creator of the national peasant prototype, Juan Chapin. Justo Rufino Barrios (1835–85) became a national hero for his liberal, far-reaching reforms between 1871 and 1885. Enrique Gómez Carillo (1873–1927), a novelist and essayist, was perhaps better known to non-Spanish readers during his lifetime than any other Guatemalan author. Twentieth-century novelists include Rafael Arévalo Martínez (1884–1975), Carlos Wyld Ospina (1891–1956), and Flavio Herrera (1895–1968). The novelist and diplomat Miguel Ángel Asturias (1899–1974) was awarded the Nobel Prize for literature in 1967.
Mario Cardinal Casariego (b.Spain, 1909–83) became the first Central American cardinal in 1969. Among the better-known Guatemalan political personalities of the 20th century are Col. Jácobo Árbenz Guzmán (1913–71), president during 1951–54, and Gen. Miguel Ydígoras Fuentes (1896–1982), president during 1958–63. Alfonso Portillo Cabrera (b.1951) served as president from 2000 to 2004. Óscar Berger (b.1946) succeeded him. Rigoberta Menchú (b.1959) won the 1992 Nobel Peace Prize for her campaign against human rights violations and for the rights of indigenous peoples.
Guatemala has no territories or colonies.