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U.S. Department of State
Guatemala Country Commercial Guide
Office of the Coordinator for Business Affairs
COUNTRY COMMERCIAL GUIDE
GUATEMALA
FISCAL YEAR 1996
This Country Commercial Guide (CCG) presents a comprehensive look at
Guatemala's commercial environment through economic, political and
market analyses.
The CCGs were established by recommendation of the Trade Promotion
Coordinating Committee (TPCC), a multi-agency task force, to consolidate
various reporting documents prepared for the U.S. business community.
Country Commercial Guides are prepared annualy at U.S. Embassies through
the combined efforts of several U.S. governement agencies.
Table of Contents
Chapter
I. Executive Summary
II. Economic Trends and Outlook
A. Major Trends and Outlook
B. Principal Growth Sectors
C. Government Role in the Economy
D. Balance of Payments Situation
E. Infrastructure Situation
III. Political Environment
A. Nature of Bilateral Relationship with
the United States
B. Major Political Issues Affecting
Business Climate
C. Brief Synopsis of Political System,
Schedule for Elections, and Orientation
of Major Political Parties
IV. Marketing U.S. Products and Services
A. Distribution and Sales Channels
B. Use of Agents and Distributors: Finding a Partner
C. Franchising
D. Direct Marketing
E. Joint Ventures
F. Licensing
G. Steps to Establishing an Office
H. Selling Factors/Techniques
I. Advertising and Trade Promotion
J. Pricing Product
K. Sales Service/Customer Support
L. Selling to the Government
M. Protecting Products from IPR
Infringement
N. Need for a local Attorney
V. Leading Trade Prospects for U.S. Business
A. Best Prospects for U.S. Exporters of Non-agricultural Products
B. Best Prospects for U.S. Exporters of Agricultural Products
VI. Trade Regulations and Standards
A. Trade Barriers, Tariffs and Import Taxes
B. Customs Valuation
C. Import Licenses
D. Export Controls
E. Import/Export Documentation
F. Temporary Entry
G. Labeling/Marketing Requirements
H. Prohibited Imports
I. Standards
J. Free Trade Zones/Warehouses
K. Membership in Free Trade Arrangements
VII. Investment Climate
A. Openness to Foreign Investment
B. Conversion and Transfer Policies
C. Expropriation and Compensation
D. Dispute Settlement
E. Political Violence
F. Performance Requirements/Incentives
G. Right to Private Ownership/Establishment
H. Protection of Property Rights
I. Regulatory System
J. Bilateral Investment Agreements
K. OPIC and Other Investment Insurance Programs
L. Labor
M. Foreign Trade Zones
N. Capital Outflow Policy
M. Major Foreign Investors
VIII.Trade and Project Financing
A. Brief Description of Banking System
B. Foreign Exchange Controls Affecting
Trading
C. General Financing Availability
D. How to Finance Exports/Methods of
Payments
E. Types of Available Export Financing
and Insurance
F. Project Financing Available
G. List of Banks with Correspondent U.S. Banking
Arrangements
IX. Business Travel
A. Business Customs
B. Travel Advisory and Visas
C. Holidays
D. Business Infrastructure
X. Appendices
A. Country Data
B. Domestic Economy
C. Trade (1994 to 1996)
D. Foreign Direct Investment Statistics
E. U.S. and Country Contacts
Country Government Agencies
Country Trade Associations/Chambers of Commerce
Country Market Research Firms
Country Commercial Banks
U.S. Embassy Trade Personnel
Washington-Based USG Country Contacts
U.S.-Based Multipliers Relevant for Country
F. Market Research
Industry Sector Analyses (ISAs)
Scheduled USDA/FAS Annual Commodity and Special Reports
G. Trade Event Schedule
I. Executive Summary
Guatemala is the northernmost country in Central America with Mexico to
the north and west, Belize and the Atlantic Ocean to the east, Honduras
and El Salvador to the southeast and the Pacific Ocean to the south.
Famed for its volcanoes, textiles and Mayan ruins, Guatemala is also a
good market for U.S. products and can be an attractive place for foreign
investment. With a population of 10 million, it is the largest country
in Central America. The capital, Guatemala City, has a population of
about two million and has several first-class hotels and restaurants.
The city is served by La Aurora International Airport, which is located
just minutes from the major business and financial areas.
Guatemala's economy is the largest in Central America, with a GDP of
about $12 billion. It is also one of the most important U.S. trading
partners in the Caribbean Basin region. Imports from the United States
in 1994 reached $1.35 billion, with a significant U.S. trade surplus,
and are forecasted to grow at an average annual rate of 10 percent over
the next few years. U.S. products and services enjoy high name
recognition in Guatemala and U.S. firms have a good reputation in the
Guatemalan market. As a result, almost one half of all Guatemala's
imports come from the United States.
The Guatemalan market is competitive. Guatemalan business people are
price sensitive and expect good after-sales service and support. They
are accustomed to doing business with U.S. firms and many travel
regularly to the United States and speak English.
The Guatemalan economy has done well over the last several years. Real
GDP grew by 4.8 percent in 1993 and by 4.0 percent in 1994. Guatemala
may see higher growth during 1995. Inflation has been relatively
moderate, as well, holding at 11.6 percent each of the last two years.
Through the first six months of 1995, the Bank of Guatemala reported an
annualized inflation rate of just under 8.0 percent. Guatemala's
expanding economy has been led by traditional exports, such as coffee
and sugar, and by non-traditional exports, such as assembled clothing,
winter fruits and vegetables, furniture and cut flowers. The non-
traditional sector, in particular has seen dramatic growth and has
provided jobs and increased income for tens of thousands of people over
the last ten years. Tourism has also developed significantly and should
continue to grow. In 1994, more than half a million tourists visited
Guatemala.
The Government of Guatemala welcomes foreign investment and generally
accords foreign investors national treatment; there are few legal or
regulatory restrictions placed on foreign investors. The U.S. is by far
the largest foreign investor in the country.
Most hurdles to exporting and investing in Guatemala are bureaucratic in
nature. The government is generally aware of these problems and has
proposed some steps to overcome them. One of the most crucial is the
"one-stop shop" for investors, legislation for which is currently
pending before the Guatemalan Congress. There are no exchange controls
and the currency, which currently trades at about 5.7 quetzales to the
dollar, has not fluctuated significantly in recent years. Currency is
bought and sold freely in national markets. There are no restrictions
on repatriation of profits by foreign business people.
Country Commercial Guides are available on the National Trade Data Bank
on CD-ROM or through the INTERNET. Please contact STAT-USA at 1-800-
STAT-USA for more information. To locate Country Commercial Guides via
the INTERNET, please use the following world wide web address: WWW.STAT-
USA.GOV. CCGs can also be ordered in hard copy or on diskette from the
National Technical Information Service (NTIS) at 1-800-553-NTIS.
II. Economic Trends and Outlook
A. Major Trends and Outlook
After peaking at 4.8 percent in 1992, real growth decelerated in 1993
and 1994 to 4.0 percent. The government's goal is 5 percent real growth
in 1995, but most observers are predicting another year of 4 percent
growth. Most of that growth continues to result from increased
consumption. Accounting for over three quarters of GDP, private
consumption continued its steady acceleration of the last five years,
increasing from 4.6 percent real growth in 1992 to 5.0 percent in 1994.
Rising a scant 0.4 percent in 1994, private investment decelerated
dramatically from the 14 percent achieved in 1992. Inflation has
exceeded the official target of 8 percent in each of the past three
years. Topping 13.7 percent in 1992, it dipped to 11.6 percent in 1993
and 1994. The goal for inflation is again 8.0 percent for 1995; through
the first six months of 1995, the Bank of Guatemala reported an
annualized inflation rate of just under 8.0 percent.
Agriculture continues to dominate the Guatemalan economy, contributing
roughly a quarter of total output, two thirds of exports and half of
employment. Guatemalan agriculture is in the process of
diversification; production of premium grade coffee no longer
predominates in the agricultural economy, even though it is still the
single largest export. In recent years there has been significant
development of small-to-medium size fruit and vegetable production for
export to the United States, Europe and the rest of Central America.
Guatemala also produces a variety of other commodities. It is the third
largest exporter of the spice cardamom, a large producer and exporter of
shrimp, seafood, cut flowers, ornamental plants, fruits and vegetables.
Overall growth in the agricultural sector should be moderate but steady
over the next three to five years. Coffee prices have recovered from
lows in the early 1990's, sugar demand should remain strong and exports
of non-traditional products should continue to grow, albeit at a slower
rate than in the late 1980's.
B. Principal Growth Sectors
Finance has been the fastest growing sector. Construction, which had
been a real growth sector has slowed significantly. After growing 21.5
percent in 1992 and 10.5 percent in 1993, construction expanded only 1.9
percent in 1994. Finance accelerated slightly from 6.4 percent real
growth in 1992 to 7.9 percent in 1993 and 1994.
The agricultural sector grew 1.9 percent, in real terms, during 1994,
down only slightly from 2 percent real growth in 1993. Over the last
five years the non-traditional products sector has accounted for
Guatemala's greatest agricultural growth. This trend is expected to
continue in the short-run, although, at a slower rate. The fruit and
vegetable industries in Guatemala have continued expanding and have
become far more organized and accustomed to U.S. regulations and market
requirements. Vegetable and fruit exporters in Guatemala can now
virtually sell all they produce. During the past five years the
production of baby vegetables (small, immature), sugar, snap peas, and
berries has increased in response to a growing demand in the United
States. Macadamia nut production is another sector showing impressive
growth potential. Future export growth will depend on increased
production and maintenance of the U.S. Generalized System of Preferences
(GSP) and Caribbean Basin Initiative (CBI) which grant them preferential
access to the U.S. market.
Guatemala's sugar production and exports should continue to rise in the
short-run as the industry continues to reduce costs through greater
efficiencies. The area planted for sugar continues to expand using
lands traditionally devoted to cotton and cattle production. The coffee
industry is expected to increase production by increasing yields, but is
not expected to begin expanding production for another few years. A key
factor for all long-run capital investment in agriculture will be
interest rates. Guatemalan interest rates are in the high twenty
percent range, which makes it difficult for agro-businesses to borrow
money locally.
C. Government Role in the Economy
The government plays a small and decreasing direct role in the economy.
It directly owns and operates a small number of enterprises. The most
significant of these are GUATEL, the Guatemalan Telecommunications
Company, INDE, the National Electrification Institute and EEGSA, the
Guatemalan Electric Company. GUATEL has a legal monopoly on
telecommunications services but has authorized domestic and foreign
firms to provide paging, cellular and international services, and is
currently in the process of selecting a second national cellular
telephone service provider. INDE and EEGSA have similarly contracted
with a number of private companies for the generation of electricity
over the last three years. One U.S. firm is already providing close to
a fifth of the country's functioning electrical capacity. Another U.S.
firm recently began operating a plant that will contribute another 78 MW
this summer.
The government accounts for only a small share of Gross Domestic Product
(GDP). Government parastatal entities contribute less than 3 percent to
GDP, in addition to the approximately 10 percent of GDP usually
generated by the central government in any given year. Poor tax
collection and administration hamper the government's ability to provide
sufficient basic infrastructure and other services and contribute to the
government's generally weak fiscal position. Tax revenues fell back to
just 6.7 percent of GDP in 1994 and the combined public sector deficit
reached 2.7 percent of GDP for the second straight year. The government
hopes to increase the tax burden to 8.5 percent and reduce that deficit
to 1.3 percent of GDP in 1995, although that looks increasingly
difficult.
D. Balance of Payments Situation
Growth in imports declined to 8.6 percent in 1994. As a result, the
trade deficit fell from 11.2 percent in 1993 to 9.5 percent in 1994. The
government hopes to bring this deficit down to 8.1 percent in 1995, if
they can boost exports by 21.8 percent and limit the growth of imports
to only 9.1 percent. With family remittances exceeding $350.00 million
a year, the current account deficit is significantly smaller than the
trade deficit. After rising to 7.8 percent in 1993, the current account
deficit dropped to 5.7 percent of GDP last year. The government hopes
to reduce it further to 4.9 percent of GDP in 1995.
In any case, the 1994 current account deficit was more than compensated
by a fairly robust net inflow of $667.20 million in private capital (a
decrease of 32 percent from 1993 inflows). Net official capital flows
decreased from $77.80 million in 1993 to $55.30 million in 1994.
Overall, net capital flows were $787.50 million in 1994, down from $959
million in the previous year. As a result, foreign reserves finished
1994 at $800.00 million, equal to slightly more than 3.5 months of
imports. The goal for 1995 is to maintain foreign reserves at that
level.
E. Infrastructure Situation
Guatemala's national infrastructure in telecommunications, electricity,
highways and ports is inadequate to meet the needs of the population and
impedes economic growth. Telephone density is low, even by regional
comparison, and only approximately one third of the population has
access to electric power. The highways are generally in poor condition
and both the highways and the ports have serious security problems.
Generally, infrastructure is significantly better in Guatemala City and
Guatemalan and foreign business people do business in Guatemala
successfully.
The Government recognizes the problems caused by the general lack of
adequate infrastructure and is working within the resource constraints
that it faces to improve the situation. The Guatemalan Telephone
Company just conducted an international public bid for a second national
provider of cellular telephone services and has been undertaking a
number of projects to increase the number of regular telephone lines
throughout the country. The two government-owned electricity providers
have are looking to private sector solutions to increase the national
capacity to generate electric power and granted contracts to national
and foreign firms to sell electric power to the national grid. In the
area of highways, the Ministry of Communications, Transport and Public
Works has also been looking to private concessions to expand and improve
the national road network. Security on the national roads and at the
ports continues to be a problem, but the Government and private sector
have formed a commission to see how the situation can be improved.
Guatemala has five ports, of which three are important for international
trade, especially in agricultural products. On the southern, Pacific
coast about 110 kilometers south of Guatemala City is Puerto Quetzal,
the country's largest and newest port, which handles all bulk grains and
a significant amount of container imports. It is connected both by
railway and by roads to the city of Escuintla and Guatemala City.
Warehouses are available within the port area, but total warehouse
infrastructure is limited. Therefore, importers and distributors
typically move their cargo to storage facilities in Guatemala City or in
the case of raw materials directly to the processing plants. Virtually
all agricultural and non-agricultural imports are moved by truck.
On the northeastern Caribbean coast, approximately 300 kilometers from
Guatemala City are the ports of Santo Tomas de Castilla and Puerto
Barrios. They have container and very limited bulk unloading capacity.
Puerto Barrios is owned by a banana company and is used mainly for
banana exports; because it is privately owned it charges higher prices
for rendering its services for export and lower prices for imports.
These ports are connected to Guatemala City by both railway and roads,
but most containers are transported by truck. These ports are ideal for
exporters from the East Coast of the United States. The vast majority
of container shipments from Miami, New Orleans and Texas enter Guatemala
through these two ports.
The La Aurora International Airport in Guatemala City is the only
international airport in the country that is equipped with freight,
legal and warehouse (including refrigerated warehouses) infrastructure.
The airport serves a large number of national and international
passenger and freight airlines and offers good access to the United
States, Central America and Mexico, as well as flights to Europe and
South America.
The Panamerican Highway runs through Guatemala connecting it with
Mexico, Honduras and El Salvador. Customs procedures have improved
significantly at the borders in recent years and no longer represent
major bottlenecks. The import/export traffic between Guatemala and El
Salvador is the heaviest.
III. Political Environment
A. Nature of Bilateral Relationship with the United States
Relations between the United States and Guatemala are generally good.
Current U.S. policy towards Guatemala is focussed on:
-Supporting the institutionalization of democracy;
-Encouraging Guatemalan respect for human rights
and the rule of law;
-Supporting the peace process to end the country's
long-running insurgency;
-Supporting sustainable broad-based economic growth,
with U.S. trade and investment; and,
-Cooperating with the Guatemalan Government in
fighting the illegal drug trade.
B. Major Political Issues Affecting Business Climate
Over the past decade, foreign investors have not generally been the
target of political violence, although Guatemala continues to struggle
to end its 35-year-old insurgency, led by the Guatemalan National
Revolutionary Union (URNG). Some public installations and projects
have, however, been affected by the violence. Numerous electrical
towers and some bridges have been destroyed or heavily damaged over the
years. Oil trucks have periodically been forced to dump their loads by
the side of the road in the Peten department. Recent advances in the
peace process offer hope that the insurgency is coming to a close.
On March 30, 1994 the Department of State issued a Travel Warning
advising all US citizens to avoid non-essential travel to Guatemala
because of possible violence related to widespread, unfounded rumors
that foreigners were stealing children in order to extract and sell
their vital organs. The warning was modified in mid-1994 to exclude
from the warning travel to the main tourist and business locations in
the country. None of the victims of the violence or harassment
resulting from the so-called "baby parts" issue has been a U.S. or
foreign businessperson.
C. Brief Synopsis of Political System, Schedule for Elections,
and Orientation of Major Political Parties
Guatemala's 1985 Constitution calls for election by universal suffrage
of a one-term President, a unicameral Congress, and municipal officers;
it mandates an independent judiciary and a human rights ombudsman, who
is elected by and reports to Congress. Democracy's roots are still
relatively shallow in Guatemala. The 1990 election was the first
peaceful transfer of power from one-elected civilian government to
another since 1951. Voter participation is generally low as is popular
confidence in the democratic system. The abstention rate in a runoff
election for the presidency in 1990 was 55 percent. More recently, 84
percent of eligible voters stayed home in a January 1994 referendum on
constitutional reforms. Twenty-six percent of the population -- the
highest in Central America -- do not oppose military intervention in
politics, according to a reliable 1993 survey. Polls also consistently
show little confidence in the judicial system and the Congress. The
significant political parties are on or towards the right of the
spectrum. Less than 5 percent of adults, however, belong to a formal
political party.
Then-Human Rights Ombudsman Ramiro De Leon Carpio was elected President
by the Congress on June 6, 1993, after President Jorge Serrano fled the
country in the wake of his failed attempt to assume dictatorial powers.
As a result of a lengthy anti-corruption campaign by De Leon that
resulted in some significant constitutional reforms, the country held
special congressional elections in August 1994, 16 months early. A new
Supreme Court was also selected shortly after the August voting last
year. General elections will be held as previously scheduled in
November 1995 to select a new congress and president. If no one
candidate in each election category wins 50 percent plus one vote, a
run-off election between the top two candidates in each election
category will be held in early January 1996. Winners will take office
on January 14, 1996.
V. Marketing U.S. Products and Services
A. Distribution and Sales Channels
Guatemalan business people are accustomed to doing business with the
United States. Most importers have traveled extensively to the United
States and/or done business with U.S. business people. Many speak
English. Nevertheless, to maximize the probability of succeeding in the
Guatemalan market, U.S. exporters should be aware of and respect local
business practices.
About half of all firms selling into the Guatemalan market do so by
means of a Guatemalan agent or distributor. The rest sell directly to
Guatemalan buyers. Generally speaking, the more pre-sales marketing and
after-sales support and service that a product requires, the more
important it is to have a local agent or distributor.
Most business is conducted in Guatemala based on personal relationships.
Guatemalan business executives and government officials place great
importance on personal contacts with suppliers. U.S. suppliers should
be prepared to have a local representative or distributor and to travel
to Guatemala personally. U.S. business persons often are surprised at
the accessibility to key decision makers and the openness and frankness
of local buyers.
B. Use of Agents and Distributors: Finding a Partner
One of the most important decisions a U.S. company will make in
Guatemala will be the selection of a qualified and competent sales
representative and/or distributor. A distributor with well-positioned
sales outlets in the major commercial locations will greatly enhance
chances of capturing a major share of the end-user market.
Selection of the appropriate agent or distributor requires time and
effort. Guatemala has a good number of qualified, competent people who
can serve in this capacity. The same high standards when selecting
someone in the United States should, to the greatest extent possible, be
used in Guatemala. English language capability, while important, should
not be the over-emphasized as a decision factor when selecting an agent
or distributor. Other Reputation, product and industry knowledge, track
record, enthusiasm and commitment should be weighed heavily.
Exclusivity will be requested by most potential agents and distributors,
not only for Guatemala, but also at times for part or all of Central
America. U.S. exporters should scrutinize the request closely. The
trend among foreign firms seeking representation in Guatemala is toward
non-exclusivity and even well-defined, renewable periods for
representation. Guatemala can be a great place from which to enter the
larger Central American market, but not all potential agents and
distributors will be in a position to do it well.
In deciding with whom to work, U.S. firms should take the time to to get
to know the people they are considering, both in business and social
settings (i.e. visit their offices, dine together, request both local
and international bank and trade references).
When consummating the agency or distribution arrangement, U.S. exporters
should make sure the agent or distributor understands clearly the terms
of the relationship. The written agreement is important; however, both
parties really need to understand it completely to avoid problems later.
The constant need to refer to the written agreement to clarify issues
forebodes problems for the success of the relationship.
Formal agency or distribution agreements should be reviewed by a
Guatemalan attorney hired by the U.S. exporter (independent of the
Guatemalan party with which the agreement is being established). The
Guatemalan legal system can be slow and the law, under certain
conditions, offers local agents and distributors a great deal of
protection. Under no circumstances should a U.S. exporter give a local
agent or distributor the responsablity of registering any intellectual
property (i.e. trademarks, trade names, copyrights, etc.); it should be
done directly by the U.S. exporter with the assistance of a Guatemalan
attorney.
C. Franchising
Guatemalan entrepreneurs are very receptive to U.S. companies offering
franchising arrangements. Presently there are close to 20 U.S. firms
operating under franchising arrangements, particularly companies that
provide fast-food services, hotel operations, physical fitness
facilities and car rentals. Such franchises include McDonald's, Burger
King, Wendy's, Sizzler Steak Houses, Westin Hotels, Marriott Hotels,
Ramada Hotels, Crowne Plaza Hotels and Radisson Hotels. The
opportunities for the establishment of additional U.S. franchises in all
areas of economic activity are very good.
D. Direct Marketing
Approximately one half of all imports from the United States are the
result of direct sales. Many of these result from Guatemalan business
people contacting potential suppliers located in their traditional U.S.
supply centers, such as Miami, South Florida, New Orleans and Houston,
among others, to satisfy a specific product or service need.
As previously mentioned, most business is conducted in Guatemala based
on personal relationships, however, direct sales by U.S. manufacturers,
suppliers, exporters, etc., to local end-users is possible without a
local representative. Direct marketing is usually more effective in
cases where the product is well known or the universe of local buyers is
relatively small and easily identifiable, i.e. sugar millers. To be
effective, a U.S. exporter would need to send a sales person (preferably
the same person all of the time so that a relationship can begin to
develop) to Guatemala on a regular basis to call on existing and
potential customers. Direct sales to Government agencies and state-
owned firms, except in a few cases, are not possible unless the foreign
firm has some sort of local representative authorized to act on its
behalf.
Telemarketing and mail order sales are not common in Guatemala.
E. Joint Ventures
Commercial companies in Guatemala are governed by the Commercial Code
(Congressional Decree No. 2-70 of January 28, 1970).
Article 10 of this Code recognizes as commercial companies those
organized exclusively as: (1) general partnerships; (2) limited
partnerships; (3) special limited liability companies; (4) corporations;
and (5) stock-issuing partnerships. Article 12 provides that banks,
insurance companies, reinsurance companies, bonding companies, re-
bonding companies, financial firms, general warehouses, stock markets,
mutual societies, and other similar organizations will be controlled
with respect to their form, organization and operation by the provisions
of the Commercial Code only to the extent they are not covered by other
specific laws and regulations.
Joint Ventures (negocios en participacion) are regulated by Articles 861
to 865 of the Commercial Code as contracts not as companies or juridical
persons. The use of a trade name that includes first names and two
family names of the participating persons shall make those persons
legally responsible, just as if they were members of a general
partnership, assuming they consented to the use of their name.
In a joint venture the participants enter into a participation contract
(contrato de participacion), by which the person called the "active
partner" obligates himself to share with one or more persons called the
"participants", who contribute goods or services, the profits or losses
resulting from one or several operations of their enterprise or of the
complete turnover thereof. The active partner operates in his own name;
there is no legal relationship between third parties and the
participants.
The Guatemalan Development Foundation (FUNDESA), a private sector
organized and operated business assistance organization, provides
information to foreign firms on joint-venture opportunities in
Guatemala. FUNDESA has offices both in Guatemala City and Miami,
Florida to provide information and assistance to U.S. firms. FUNDESA
plans to open a New Orleans Office in September 1995. The telephone
number for the Miami Office is (800) 741-6133.
F. Licensing
A company or association that has been legally established in the United
States may be established in Guatemala or may have agencies or branches
in Guatemala, after receiving authorization from the government. It must
show proof of its legal constitution, that it is not opposed to the laws
of the republic, and that it has appointed a remunerated local agent
with all general and special powers. For purposes of the law, the agent
will be presumed to be invested with such powers, even though the agency
agreement may not specifically so provide.
A foreign company or association that does business in Guatemala is
required to: (a) establish agencies or branches that take care of its
business; (b) have an accounting system, in legal form and in Spanish,
in which the operations or business negotiations that take place in
Guatemala are recorded; and (c) submit for decision by the laws and
courts of the republic any legal questions that arise from the business
of the agency or branch.
In general, licensing is defined as a contract partnership in which two
or more persons agree to place goods or services in common for the
purpose of carrying on a economic activity and dividing the profits. The
licensing contract is tailored according to the needs and interests of
the parties involved. However, all obligations are governed by the
Civil Code.
G. Steps to Establishing an Office
How to Obtain Permission to Operate in Guatemala:
A foreign entity legally registered in its country of origin and
intending to do business in Guatemala must:
-- Register with the Mercantile Registry (Registro Mercantil) and
-- Register with the Guatemalan Internal Revenue Service
(Direccion General de Rentas Internas-DGRI).
Documents to be submitted to the Mercantile Registry with
Request for Registration:
-- Proof that the entity is legally constituted in accordance
with the laws of the country (state) in which it is organized
or registered.
-- Certified copy of the deed of incorporation (charter), the by-
laws and modifications thereto.
-- Proof that the Board Directors has duly resolved to operate in
Guatemala and has authorized the legal procedure to obtain
permission to do so.
-- A power of attorney in which the person named is given ample
powers to act and to represent the entity in all legal matters.
-- A document in which an amount is assigned as capital with
reference to the entity's operations in Guatemala and in which
it is expressly stated that the entity will be responsible
for its obligations in Guatemala with all of its assets
both in Guatemala and abroad.
-- A declaration that the entity recognizes the jurisdiction of the
courts and laws of Guatemala with respect to its activities and
operations in the country and that neither the entity nor its
representatives and employees will will seek special rights as
foreigners.
-- A declaration that the entity, prior to concluding operations in
Guatemala will fulfill all legal requirements in connection
therewith.
-- Certified copies of its latest financial statements (balance
sheet and income account).
The documents must be certified by an authorized official in the country
(state) of origin and must be authenticated by an appropriate Guatemalan
Consular Official.
The address of the Mercantile Registry is the following:
-- Registro Mercantil de Guatemala
6 Calle 7-57, Zona 1
01001 Guatemala, C.A.
Tel. (502-2) 535819 and 300827
Attn. Mercantile Registrar
Registration with the Guatemalan Internal Revenue Service-DGRI:
The documentation for registration with the DGRI, as required by the
Income Tax Law is identical to that required for registration with the
Mercantile Registry. It is advisable to have the documents prepared in
duplicate and to submit one set to the DGRI together with a copy of the
authorization to operate in Guatemala issued by the Ministry of
Government. Registration under the Value Added Tax (Decree 72-83) is
also necessary.
H. Selling Factors/Techniques
The three most important factors affecting Guatemalan purchasing
decisions are price, service and quality. Being "Made in USA" usually
confers a strong advantage to any product in the Guatemalan market
place.
Direct sales by U.S. exporters to end-users, importers/wholesalers and
retailers is usually most successful when the product is well known
within the market or when a limited number of (usually large) buyers
exists. Direct sales are often supported by local advertisement, sales
promotional campaigns, technical or illustrative brochures, visits by
salespeople and in some cases samples.
Sales via local agents and distributors are the most effective means of
penetrating the market successfully in most cases. The U.S. exporter
appoints a person or firm who in turn either promotes sales on a
commission basis or purchases the merchandise and resells it. Endusers
and retailers generally do not have the experience nor the time to
import directly or to handle customs clearance which is time consuming.
Once an exclusive representation has been given to a local company, it
can not be taken away and given to another concern without complying
with the existing Agency, Distribution and Representation Law contained
in Congressional Decree No. 78-71, of September 29, 1971.
I. Advertising and Trade Promotion
Advertising in Guatemala is usually done through the local media such as
newspapers, magazines, radio and television. Also the use of billboards
displayed along highways has proliferated in recent years. Firms
interested in advertising in Guatemala may want to contact the following
association for guidance and names of Guatemalan firms that could be of
assistance.
-- Union Guatemalteca de Agencias de
Publicidad - UGAP
(Guatemalan Union of Publicity Agencies)
3 Avenida y 12 Calle, Zona 10
Edificio Geminis 10, Torre Norte
01010 Guatemala, C.A.
Tel. (502-2) 35-32-69
Fax: (502-2) 35-32-68
Trade Promotion:
The U.S. Department of Commerce's Commercial Office at the U.S. Embassy
in Guatemala City can provide guidance and assistance to U.S. firms
seeking to enter or expand their presence in the Guatemalan market. The
following trade associations at times can also provide guidance,
information and/or assistance to companies planning trade promotion
events which may include product demonstrations, seminars, conferences,
etc. The associations are as follows:
-- American Chamber of Commerce of Guatemala
6 Avenida 14-77, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 68-31-06/37-44-89
Contact: Charles Chambers, Executive Director
-- Camara de Comercio de Guatemala
(Chamber of Commerce)
10 Calle 3-80, Zona 1
01001 Guatemala, C.A.
Tel. (502-2) 30-51-56
Fax: (502-2) 51-41-97
Contact: Sr. Federico Pola, Manager
-- Camara de Industria de Guatemala
(Chamber of Industry)
Edificio Camara de Industria
Ruta 6, No. 9-21, Zona 4, Nivel 12
01004 Guatemala, C.A.
Tel. (502-2) 34-08-49
Fax: (502-2) 34-10-90
Contact: Lic. Eduardo Sperisen, Executive Director
-- Fundacion para El Desarrollo, S.A. - FUNDESA
(Guatemalan Development Foundation)
Parque Gerencial Las Margaritas, Nivel 4
Diagonal 6, 10-65, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 32-79-52 to 56
Fax: (502-2) 32-79-58
A major international promotion scheduled for October 31 to November 12,
1995 is INTERFER, the Guatemalan international trade fair held every odd
year in Guatemala City. Information on exhibiting in the "USA Pavilion"
can be obtained from the Commercial Service Office at the U.S. Embassy,
tel: 011-502-2-31-15-41 ext. 259 and fax: 011-502-2-31-73-73.
Major Newspapers:
The leading major dailies in Guatemala are the following:
1. Prensa Libre
13 Calle 9-31, Zona 1
Edificio Prensa Libre
01001 Guatemala, C.A.
Tel. (502-2) 30-50-96
Fax: (502-2) 51-87-68
2. Diario El Grafico
14 Avenida 4-33, Zona 1
01001 Guatemala, C.A.
Tel. (502-2) 30-50-80
Fax: (502-2) 51-00-14 (advertising)
3. Siglo Veintiuno
7 Avenida 11-63, Zona 9
Edificio Galerias Espana, Nivel 6
01009 Guatemala, C.A.
Tel. (502-2) 60-67-04
Fax: (502-2) 31-91-45
4. Diario La Republica
13 Calle 8-41, Zona 10
01010 Guatemala, C.A.
Tel. (502-2) 34-38-43
Fax: (502-2) 39-03-51 (advertising)
5. Diario La Hora
9 Calle "A" 1-56, Zona 1
01001 Guatemala, C.A.
Tel. (502-2) 2-68-66/2-68-64
Fax: (502-2) 51-70-84
Television Channels/Companies:
The following are the major television channels in Guatemala:
1. Canal 3 de Television
Canal 7 de Television
30 Avenida 3-40, Zona 11
01011 Guatemala, C.A.
Tel. (502-2) 94-64-92/94-74-91
Fax: (502-2) 94-74-92
2. Canal 5 de Television
4 Calle 18-68, Zona 1
01001 Guatemala, C.A.
Tel. (502-2) 53-21-03
Fax: (502-2) 53-39-71
3. Canal 11 de Television
Canal 13 de Television
20 Calle 5-02, Zona 10
01010 Guatemala, C.A.
Tel. (502-2) 68-05-69/68-25-32
Fax: (502-2) 37-08-61
4. Canal 21 de Television
Avenida de Las Americas 14-06, Zona 13
01013 Guatemala, C.A.
Tel. (502-2) 31-46-16
Fax: (502-2) 31-45-71
5. Mayacable/Comtech
23 Avenida 31-01, Zona 5
01005 Guatemala, C.A.
Tel: (502-2) 35-58-55
Fax: (502-2) 35-57-44
Radio Stations:
The following is a list of some of the major radio stations in Guatemala
City.
1. Radio Fabu Stereo
4 Avenida 2-07, Zona 9
01009 Guatemala, C.A.
Tel. (502-2) 31-65-26
Fax: (502-2) 34-11-94
2. Cadena Azul de Guatemala
Radio Mundial y Radio Emperador
6 Avenida 2-80, Zona 1
01001 Guatemala, C.A.
Tel. (502-2) 53-94-18
Fax: (502-2) 53-36-52
3. Emisoras Unidas
4 Calle 6-84, Zona 13
01013 Guatemala, C.A.
Tel: (502-2) 71-74-44
Fax: (502-2) 72-02-83
4. Radio Nuevo Mundo
Radio Cristal
6 Avenida 10-45, Zona 1, Nivel 2
Tel: (502-2) 30-36-18/30-39-28/30-46-18
Fax: (502-2) 2-20-36
5. Organizacion Alius
6 Avenida 0-60, Zona 4
Edificio Torre Profesional II, Nivel 3
01004 Guatemala, C.A.
Tel. (502-2) 35-24-33
Fax: (502-2) 35-20-45
6. Radio Panamericana
1a Calle 35-48, Zona 7
01007 Guatemala, C.A.
Tel: (502-2) 91-22-93
Fax: 95-65-04
7. Radio Corporacion Nacional
6 Avenida 11-55, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 35-20-30
Fax: (502-2) 35-20-05
Magazines and Business Journals:
The following are some of the leading magazines for business in
Guatemala.
1. Revista Cronica
6 Avenida 0-60, Zona 4
Edificio Torre Profesional II
Nivel 3, Of. # 312
01004 Guatemala, C.A.
Tel. (502-2) 35-16-93
Fax: (502-2) 35-23-60
2. Revista Critica
6 Avenida y 10 Calle, Zona 1
Plaza Vivar, 4o Piso
01001 Guatemala, C.A.
Tel. (502-2) 51-43-71
Fax: (502-2) 51-87-56
4. Revista Gerencia
Asociacion de Gerentes de Guatemala
6 Avenida 1-36, Zona 14
01014 Guatemala, C.A.
Tel. (502-2) 32-93-32 to 36
Fax: (502-2) 32-93-42
5. Revista Industria
Camara de Industria de Guatemala
Ruta 6, No. 9-21, Zona 4
Edificio Camara de Industria
01004 Guatemala, C.A.
Tel. (502-2) 34-08-49 to 58
Fax: (502-2) 34-10-90
6. Revista Comercio
Camara de Comercio de Guatemala
10 Calle 3-80, Zona 1
01001 Guatemala, C.A.
Tel. (502-2) 30-51-56/30-36-28
Fax: (502-2) 51-41-97
7. Guatemala Business Review
American Chamber of Commerce of Guatemala
6 Avenida 14-77, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 37-44-89
Fax: (502-2) 68-31-06
J. Pricing Product
Price is a very important decision factor for most Guatemalan business
people when selecting a supplier of imported goods and services. Many
Guatemalan business people are accustomed to purchasing directly from
abroad when they feel that the price of locally available imported
products or services are too high.
The Pricing of a product is based on different factors. Local merchants
consider the following when deciding how to price a product.
a) Product F.O.B. cost
b) Product freight and/or transportation cost
c) Product insurance cost
d) Consular fees
e) Import duties
K. Sales Service/Customer Support
Sales service and support ranks high in the minds of Guatemalan buyers.
U.S. firms, more than other foreign firms, generally have a reputation
for providing good service and support. U.S. firms interested in
penetrating the Guatemalan market should make a commitment to offer
excellent service and support to their Guatemalan buyers, agents and
distributors. This commitment to excellent service and support should
also be made clear by the U.S. firm to its local agent or distributor.
Poor or mediocre service often leads to lower sales. The Guatemalan
business community is comparatively small and word travels fast about
local and foreign firms that offer poor service and support.
Although after-sales service is not included in the Commercial Code,
many representatives, wholesalers and retailers provide after-sales
service and support. This is particularly the case with items such as
household appliances, electronic consumer goods, telecommunications and
computer equipment, other electronic equipment and industrial machinery.
There are no provisions in the law regarding product guarantees.
However, most retailers provide some sort of guarantee that covers
problems that occur under normal conditions of use.
L. Selling to the Government
Sales to government agencies and corporations are best achieved through
local agents, distributors and other types of representatives; at times
it is a requirement. Either way, it is not very practical to target
government sales if a firm does not have anyone in Guatemala to be on
the look out for the opportunities and then to assist with obtaining the
specifications and meeting the deadlines for submission.
The existing Government Procurement Law (Decree 57-92) stipulates that
all government purchases over US$ 161,000 must be submitted for public
competitive bidding and no less than 5 bidders must participate, except
when a project is considered to be so urgent as to be declared a
national emergency. In the latter case the Government of Guatemala can
forgo the bidding process and may acquire the goods or services,
regardless of the amount, from local firms or through dealers for direct
importation. Unless otherwise specified, all government public bidding
requires foreign suppliers to meet pre-qualification requirements, and
to submit bids through local established representatives. Government
purchases or acquisitions are generally exempted from import duties.
The period granted for submission of bids is often quite limited.
M. Protecting Products from IPR Infringement
U.S. and other foreign encounter a various kinds of intellectual
property issues in Guatemala. Firms with valuable intellectual property
to protect should take the legal steps necessary to assure that it is
protected. Firms should never delegate to a local agent, distributor or
business partner the job of registering intellectual property. It
should be done directly by the U.S. firm with the assistance of a
Guatemalan attorney. Careful attention to IPR issues initially can
prevent problems later.
Industrial Property Registry:
Congressional Decree No. 26-73 ratified the Central American Agreement
for Industrial Protection. This law established a uniform legal
framework for all the Central American countries regarding trademarks,
trade names and expressions or publicity jingles and signs.
Ownership of a trademark is obtained through its registration in
accordance with the above mentioned agreement and proven with the
registry's certification, issued by a competent authority.
The rights granted through the registration of a trademark last ten
years, and may be renewed repeatedly for the same period of time by
complying with the requirements established by the agreement.
Any natural or legal person, may obtain the registration of his trade
marks.
The Industrial Property Registrar may be contacted at:
-- Registro de la Propiedad Industrial
5 Calle 4-31, Zona 1
Edificio Plaza Rabi, 7o Nivel
01001 Guatemala, C.A.
Tel. (502-2) 30-16-92/7 and 30-18-22/5
N. Need for a Local Attorney
The professional services of a lawyer are very useful in instances like
preparation of agency and distribution agreements and practically
essential for registration of a new company, registration of a patent or
trademark, debt collection, property rights, power of attorney, and
trade arbitration. As a matter of good business practice U.S. business
people should not share the attorneys utilized by their local business
associates.
The following is a list of some of the Guatemalan law firms that have
English-speaking attorneys and practice international corporate law in
Guatemala. The U.S. Government cannot recommend any particular attorney
and many other qualified attorneys also practice business law in
Guatemala.
BELTRANENA, DE LA CERDA Y CHAVEZ
Avenida La Reforma 12-01, Zona 10
Edificio Reforma Montufar
01010 Guatemala, C.A.
Tel: (502-2) 31-86-33
Fax: (502-2) 31-76-14
Contact: Luis Beltranena Valladares
QUEZADA, TORUÑO Y ASOCIADOS
Avenida La Reforma 9-00, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 31-20-01
Fax: (502-2) 32-37-36
Contact: Fernando Quezada
BONILLA, MONTANO & TORIELLO
Avenida La Reforma 15-54, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 34-40-57/34-40-86/32-60-62
Fax: (502-2) 32-23-61
Contact: Rodrigo Toriello Arzu
PALOMO CAMPOS Y ASOCIADOS
12 Calle 1-25, Zona 10
Edificio Gemenis 10, Torre Norte, Ofcna. 1306
01010 Guatemala, C.A.
Tel: (502-2) 35-33-01/35-33-04 to 06
Fax: (502-2) 35-32-97
Contact: Eduardo Palomo E.
SOTO & SOTO
13 Calle 1-51, Zona 10
Edificio Santa Clara, Torre II, Ofcna. 202
01010 Guatemala, C.A.
Tel: (502-2) 31-39-60
Fax: (502-2) 31-34-09
Contact: Manuel Arturo Soto
MAYORA & MAYORA
Ruta 6, 9-21, Zona 4
Edificio Camara de Industria, Nivel 4
01004 Guatemala, C.A.
Tel: (502-2) 31-03-97/32-35-42/34-79-21
Fax: (502-2) 32-35-23
Contact: Eduardo Mayora Dawes
V. Leading Trade Prospects for U.S. Business
A. Best Prospects for U.S. Exporters of Non-Agricultural Products
(Millions of $US)
A. RANK OF SECTOR: 1
B. NAME OF SECTOR: Computers and Peripherals
C. ITA INDUSTRY CODE: CPT
1994 1995 1996
D. Total Market Size: 57.4 77.9 96.5
E. Total Local Production: - - -
F. Total Exports: .5 5.5 6.0
G. Total Imports: 57.9 72.4 90.5
H. Total Imports from U.S.: 52.3 65.4 81.7
I. Exchange Rate: 5.77 5.74 N/A
Comments:
The market for computers and peripherals is growing. Future demand for
computers and peripherals is excellent.
Imports of computers and peripherals increased from 40.3 million Dollars
in 1993 to 57.9 million Dollars in 1994, a 43 percent increase.
The Guatemalan government purchased approximately 15 percent of the
equipment imported. The rest was bought by industry, commerce, banks,
professionals, hospitals, individuals and universities.
Computers and peripherals have become an everyday necessity and are
essential to the public sector and to large private concerns. A large
number of PCs are being sold to small and medium sized firms, as well as
to the public in general. There are approximately 200 recognized
computer and peripheral equipment dealers in Guatemala, as well as four
warehouses. In addition there are a large number of "unofficial"
dealers who purchase only from the warehouses for a limited number of
clients. The import market is expected to grow at an estimated annual
rate of 25 percent for the next three years.
The main competitors for U.S. exporters, which already have a 90.4
percent of the import market, are: Panama with 2.9 percent of the
market; Mexico with 1 percent of the market; and Japan also with 1
percent of the market.
List of the most promising sub-sectors within this industry, along with
estimated 1996 total market size of each sub-sector (USD millions) :
8473.3000 Parts & Access. for adp. machines and units 26.1
8471.2000 Electronic computers 25.0
8471.1000 Analog or hybrid adp. machines 3.6
8471.90 Peripheral equipment 3.5
8523.2000 Unrecorded magnetic discs 1.6
Best Prospects for U.S. Exporters of Non-Agricultural Products
(US$ millions)
A. RANK OF SECTOR: 2
B. NAME OF SECTOR: Agricultural Machinery and Equipment
C. ITA INDUSTRY CODE: AGM
1994 1995 1996
D. Total Market Size: 91.2 109.6 127.7
E. Total Local Production: 28.4 34.1 40.9
F. Total Exports: 1.3 1.4 1.6
G. Total Imports: 64.1 76.9 88.4
H. Total Imports from U.S.: 36.8 44.2 53.0
I. Exchange Rate: 5.77 5.74 N/A
Comments:
1994 imports of agricultural machinery and equipment increased by 37.7
percent over the previous year. The U.S. alone experienced a 44.4
percent increase in exports to Guatemala between 1993 and 1994. Among
the traditional export crops, coffee had the highest earnings. Sugar
cane and milling machinery imports are expected to increase, since many
firms are increasing their investments. Guatemala's agricultural sector
is in the process of diversification. Agro-industries are being
established, using vegetable and fruit produce. The Bank of Guatemala
reported that during the first semester of 1995 export earnings for non-
traditional agricultural products increased by 42.9 percent over the
same period in 1994. Agricultural machinery import projections look
favorable with expected annual increases of 20% for the next three
years.
The agricultural sector employs approximately 60 percent of the labor
force of the country, contributes 25 percent to the gross domestic
product of Guatemala and accounts for about 66 percent of the country's
export earnings.
The main competitors for U.S. exporters in this industry are: Japan with
8.6 percent market share; Germany with a 6.4 percent market share; and
Italy with a 5.6 percent market share.
List of the most promising sub-sectors within the industry, along with
estimated 1996 total market size of each sub-sector (USD millions):
4011.9100 Tractor and agricultural machinery tires
and tubes 2.7
4011.9900 3.2
8201.4000 Hand tools and parts 3.1
8424.8110 Sprayers - agricultural and horticultural 2.5
8431.3900 Parts and accessories for conveyors, loaders
and elevators 1 0.0
8701.9010 Agricultural tractors, Disesel operated 43.0
8708.9900 Parts and accessories for agric. tractors 32.6
8716.3900 Trailers and loaders 3.3
New and used machinery.
Best Prospects for U.S. Exporters of Non-Agricultural Products
(U.S. millions, unless otherwise noted)
A. RANK OF SECTOR: 3
B. NAME OF SECTOR: Telecommunications Equipment
C. ITA INDUSTRY CODE: TEL
1994 1995 1996
D. Total Market Size 39.4 50.4 71.8
E. Total Local Production -- -- --
F. Total Exports 0.6 1.0 2.2
G. Total Imports 40.0 51.4 74.0
H. Total Imports from U.S. 20.0 24.6 34.0
I. Exchange Rate: 5.77 5.74 N.A.
Comments:
The largest buyer/importer of telephone equipment and systems is GUATEL,
the government-owned Guatemalan Telecommunications Company. Guatemala
is probably the largest importer of telephone equipment in Central
America. One of the fastest growing sub-sectors within this industry is
cellular telephony. The second cellular concession (Band "A") will be
awarded in September and the winning firm will start operations at the
end of 1995. According to GUATEL estimates, the establishment of the
new firm could generate additional imports of equipment in the U.S.$
7.0 to 10.0 million range in 1996 alone. Also within the next five
years, the following projects will be undertaken by GUATEL's Planning
Division: a) Installation of 50,000 digital lines in the capital city;
b) Installation of switching equipment for 40,000 telephone lines; c)
Installation of fiber-optic network and transmission equipment ,
electric power, air conditioning and the external plant for 47,000
subscribers; d) interconnection and infrastructure for metropolitan
telecommunications; e) Digital net-datalink: Digitalization of lines
rented to third parties in the Metropolitan Network and main towns in
the rest of the country. Also, the market for telecommunications
equipment, such as faxes, telephone sets, PBX's, answering machines and
others is open. Any government office, private company or individual can
acquire these products from local distributors. The import market for
this equipment is expected to grow at a rate of approximately 15 percent
per year. Local production includes
assembling of T.V. sets, telephone sets and some radio communications
equipment. The largest supplier of telecommunications equipment is the
U.S. with 48.0 percent of the import market. The second supplier is
Japan with 33.0 percent, followed by Mexico with 21.0 percent (1994).
Other country suppliers include Germany, Sweden, Panama and Taiwan.
List of the most promising subsectors within the industry, along
with estimated 1996 total market size of each subsector (USD
millions):
HTS NO.
85173 Telephone exchanges 15.0
85173 Telephone switching equipment 15.0
85173 Cellular telephone equipment 12.0
85179 Telephone switching parts 4.0
85171 Telephone sets 5.3
85183 Telephone hand-sets 2.0
85252 Telephone parts 2.5
85281 Television sets 5.0
85442 Telephone multi-cable 3.0
85447 Optical fiber cable 5.0
85251 Radio Transmission equipment 4.0
- - - Others 3.6
Best Prospects for U.S. Exporters of Non-Agricultural Products
(US$ millions)
A. RANK OF SECTOR: 4
B. NAME OF SECTOR: Food Processing & Packaging Equipment
C. ITA INDUSTRY CODE: FPP
1994 1995 1996
D. Total Market Size: 58.1 64.5 73.9
E. Total Local Production: 16.3 18.7 21.5
F. Total Exports: .2 2.5 3.1
G. Total Imports: 42.0 48.3 55.5
H. Total Imports from U.S.: 16.8 19.3 23.2
I. Exchange Rate: 5.77 5.74 N/A
Comments:
The market for food processing and packaging equipment has high
potential in Guatemala, due to strong interest in the country in
establishing new agro-industry plants and expanding existing ones, both
for local consumption and for export purposes as part of the campaign to
emphasize non-traditional exports. Non-traditional product exports were
reported by the Bank of Guatemala to have increased during the first
semester of 1995 by 42.9 percent over the same period in 1994.
There is also great demand for international food franchises, especially
U.S. franchises, which also use food processing equipment.
The U.S. market share during 1994 was 39.9 percent, followed by Germany
with 33.6 percent, Mexico with 3.9 percent and Argentina with 3.8
percent. For the next three years it is expected that imports will
increase at an annual average of 15 percent.
List of the most promising sub-sectors within the industry, along with
estimated 1996 total market size of each subsector (USD millions):
8419.8950 Machinery, plant equipment to process, heat,
cook, sterilize, cool, etc. food and beverages 3.8
8421.1100 Cream separators 2.5
8422.3090 Packaging machinery, including cleaning,
bottling, filling and sealing bottles, cans 11.1
8438.1000 Bakery, macaroni, spaghetti, etc. machinery 1.8
8438.3000 Machinery for sugar preparation 2.5
8438.4000 Brewery machinery 7.7
8438.8000 Machinery for the preparation and manufacture
of food and beverages 2.5
8438.9000 Parts for food processing machinery 6.3
8479.2000 Machinery for the extraction and preparation
of animal and vegetable oils and fats 3.2
Food processors are buying both new and used machinery.
Best Prospects for U.S. Exporters of Non-Agricultural Products
(U.S. millions, unless otherwise noted)
A. RANK OF SECTOR: 5
B. NAME OF SECTOR: Electrical Power Gen. & Dist.
C. ITA INDUSTRY CODE: ELP
1994 1995 1996
D. Total Market Size 42.7 45.6 49.9
E. Total Local Production 16.2 17.1 18.0
F. Total Exports 8.5 9.3 10.1
G. Total Imports 35.0 37.8 42.0
H. Total Imports from U.S. 16.0 17.1 20.0
I. Exchange Rate: U.S.D. 5.77 5.74 N.A.
Comments:
Total imports of electrical power generation and distribution equipment
have increased at an average rate of 5.0 percent per year. Electricity
sector authorities have reported that the forecasted demand for 1997
will be over 1,000 mega-watts and that by the end of this year 200
additional mega-watts will be installed. In the the short term, the
Guatemalan Electric Company (Empresa Electrica de Guatemala, S.A.-
EEGSA) plans to install or contract the installation of 4 or 5
electrical power generation sub-stations, which will increase the
national electrical power generation capacity by about 650 mega-watts by
the year 2000 at an estimated cost of U.S.$ 2.6 billion. Current
consumption is 300 kilowatts per capita per hour. Over the last five
years, the demand for energy has increased by 7 percent per year.
However, it is expected that from now to the year 2005 this demand will
grow at an annual rate of 6.5 percent. The local industry, which
consists principally of manufacturers of wire and cables, connectors and
terminals, fuse and switching boxes, and switch gears, also grew by
about 6.0 percent in terms of production value over the last year. The
U.S. has been the leading country supplier with approximately 42 percent
of the total imports. Other important suppliers include: El Salvador
(materials only), Germany, Japan, Brazil and Mexico.
List of the most promising subsectors within the industry, along
with estimated 1996 total market size of each subsector (USD
millions):
HTS NO.
8410/01 Hydraulic Turbines and parts 10.0
85023 Electrical/gas generators 10.0
85010 Electric generators 1.5
85023 Generating sets N.E.C. 2.0
84021/2 Steam Boilers and parts 2.0
85440 Wire and cable 3.0
85042 Dielectric Transformers 4.0
85043 Electric Transformers 2.0
83610 Automatic circuit breakers 1.0
85371 Control panels, consoles, desks 0.5
85324 Lightning arresters 0.4
85372 Switchgears and switchboards 1.0
85461 Electrical insulators 0.5
90283 Electricity meters 0.6
---- Others 1.0
Best Prospects for U.S. Exporters of Non-Agricultural Products
(U.S. millions, unless otherwise noted)
A. RANK OF SECTOR: 6
B. NAME OF SECTOR: Automotive Parts/Service Eqpt.
C. ITA INDUSTRY CODE: APS
1994 1995 1996
D. Total Market Size 36.2 39.0 42.5
E. Total Local Production 10.5 11.7 12.5
F. Total Exports 0.5 0.7 1.0
G. Total Imports 26.2 28.0 31.0
H. Total Imports from U.S. 11.8 13.1 15.2
I. Exchange Rate: 5.77 5.74 N.A.
Comments:
Imports of automotive parts, accessories and service equipment have been
growing steadily for the past three years. The future for this product
category looks promising. In order for U.S. suppliers to compete against
third country suppliers (Japan, Germany, Brazil and Taiwan), they must
offer good quality and service plus competitive prices. The U.S. has
been the leading country supplier accounting for approximately 45
percent of the total imports. Local production of certain items is also
growing due to the high retail price of some imported parts and
accessories and the growing number of vehicles in circulation. Most
vehicles in circulation in Guatemala are Japanese and European,
nevertheless, sales of U.S. vehicles are increasing.
List of the most promising subsectors within the industry, along
with estimated 1996 total market size of each subsector (USD
millions):
HTS NO.
840991 Ignition parts 9.0
848210 Ball bearings 4.5
87840 Engine parts 6.0
841391 Parts for fuel-inject. pumps 2.5
851100 Electronic ignition parts 1.5
848310 Transmission parts 3.0
841330 Fuel and oil pumps 0.8
840820 New and used engines 1.7
851220 Electrical lightning eqpt. 0.7
848410 Engine gaskets 1.0
401010 Rubber belts 1.0
681310 Brake linings and pads 2.0
840734 Spark ignition parts 2.0
- - - Others 9.5
Best Prospects for U.S. Exporters of Non-Agricultural Products
(US$ millions)
A. RANK OF SECTOR: 7
B. NAME OF SECTOR: Medical Equipment
C. ITA INDUSTRY CODE: MED
1994 1995 1996
D. Total Market Size: 25.6 29.8 36.9
E. Total Local Production: 10.2 11.2 12.3
F. Total Exports: 1.2 1.3 1.4
G. Total Imports: 16.6 19.9 24.9
H. Total Imports from U.S.: 8.6 9.9 11.9
I. Exchange Rate: 5.77 5.74 N/A
Comments:
During 1994 and 1995 the major importers of medical equipment have been
the private sector and international organizations providing assistance
in the health sector. 1994 imports increased by 39 percent over 1993.
U.S. exports rose 30 percent during the same period. Funds have been
virtually non-existent for government hospitals and institutions.
Guatemala, for the last several years, has been and still is in need of
medical equipment and supplies. Very good possibilities for imports of
equipment from the U.S. and other countries are foreseen for 1996 and
1997.
Loans from international financial organizations have been promised and
are expected to be made available soon.
The U.S. has a 52 percent share of the import market. The main foreign
competitors for the U.S. are: Japan with 16 percent; Germany with 9
percent and Taiwan with 3 percent.
List of the most promising sub-sectors within this industry, along with
estimated 1996 total market size of each sub-sector (USD millions) :
8713.9000 Invalid carriages, wheelchairs. 3.0
9018.1940 Electro-medical, electro-diagnostic equipment. 4.3
9018.3900 Catheters, drains, sondes, cannulae, parts
and access. 2.9
9018.9000 Odontologic instruments and apparatus 2.8
9018.9060 Electro-surgical instruments, appliances and
parts. 2.8
9022.1100 X-ray apparatus for medical, surgical and
dental use. 2.9
Best Prospects for U.S. Exporters of Non-Agricultural Products
(U.S. millions, unless otherwise noted)
A. RANK OF SECTOR: 8
B. NAME OF SECTOR: APPAREL
C. ITA INDUSTRY CODE: APP
1994 1995 1996
D. Total Market Size 33.7 35.5 34.2
E. Total Local Production 47.5 49.0 46.0
F. Total Exports 34.5 35.0 34.0
G. Total Imports 20.7 21.5 22.2
H. Total Imports from U.S. 5.5 6.4 7.3
I. Exchange Rate: 5.77 5.74 N.A.
Comments:
For the above shown figures it should be noted that export figures are
larger than total import figures, local production is almost exclusively
destined for exports to the U.S. market and the rest to the Central
American countries of El Salvador, Honduras and Nicaragua. Despite the
decrease in the maquiladora operations, the U.S. is the second largest
country supplier of apparel accounting for 26.5 percent of the total
imports. El Salvador was the leading supplier (1994) with 31.4, percent
followed by Panama with 10 percent. Other suppliers include Hong Kong
and Taiwan. It is estimated that approximately 40.0 percent of the total
imports of apparel from the U.S. are used clothing.
List of the most promising subsectors within the industry, along
with estimated 1996 total market size of each subsector (USD
millions):
HTS NO.
62034200 Women dresses 4.0
61091000 Cotton T-Shirts 1.9
62044900 Other women dresses 1.2
62121000 Women innerwear 1.3
61051000 Cotton shirts 1.1
61034200 Cotton pants 0.8
62042200 Cotton dresses 0.7
62052000 Other cotton shirts 0.8
62041200 Cotton suits 0.8
62046200 Women cotton pants 0.6
62031900 Other suit and dresses 0.5
61032200 Sleeping wear 0.5
62053000 Synthetic fiber shirts 1.0
65040000 Felt hats 0.4
- - - - Others 5.2
B. Best Prospects for U.S. Exporters of Agricultural Products
(US$ millions)
The following best prospects list is ranked according to the anticipated
two year growth between 1995 and 1996. The only exception is U.S. beef
exports which was ranked #8 because the market is so small.
A. #1
B. Snack Foods
C. N/A
1994 1995 1996
($ 1,000)
D. Total Market Size
E. Total Local Production Information not available
F. Total Exports
G. Total Imports
H. Total Imports from U.S. 2,601 3,500 4,000
Comments:
U.S. exports of snack foods to Guatemala have increased dramatically
over the past several years and while the rate of growth in exports is
likely to decline some over the next few years, strong continued growth
is forecast. Potato chips, popcorn, nacho chips, nuts and other salted
snack products are the leading sellers from the United States.
Competition from neighboring countries, especially Mexico and El
Salvador, is fairly strong. The other CACM-4 countries have duty-free
access to the Guatemalan market. Mexican and Central American snack
producers also have the infrastructure to manufacture and market product
sold in small package sizes. This allows them to dominate the low-end,
high-volume portion of the market.
A. #2
B. Beer & Wine
C. N/A
1994 1995 1996
($ 1,000)
D. Total Market Size
E. Total Local Production Information not available
F. Total Exports
G. Total Imports
H. Total Imports from U.S. 482 550 750
Comments:
There is tremendous opportunity for increased U.S. beer and wine sales
to Guatemala, but the key to success is establishing a solid exporter-
distributor relationship. One major U.S. beer company has recently
signed an agreement with the Guatemalan beer monopoly which should
significantly expand its presence in Guatemala. The locally produced
brands cover 85 percent of the market. Other than U.S. beer, German,
Dutch, and Mexican beers have had limited success in Guatemala. Exports
of U.S. wines to Guatemala have also been limited in the past.
Guatemalans perceive U.S. wines to be of inferior quality. This
resulted in Chile, France, Spain, and Italy becoming the main wine
suppliers to Guatemala. This trend should change as local distributors
make greater efforts to promote U.S. wines.
A. #3
B. Breakfast Cereals & Pancake mixes
C. N/A
1994 1995 1996
($ 1,000)
D. Total Market Size
E. Total Local Production Information not available
F. Total Exports
G. Total Imports
H. Total Imports from U.S. 2,180 2,100 2,400
Comments:
Guatemalan trade statistics are not available for breakfast cereals.
U.S. trade data show significant growth in U.S. exports of breakfast
cereals to Guatemala in the past two years. This is expected to continue
over the next few years as disposable incomes rise. Breakfast cereal
targeted at children is expected to be the fastest growing sub-sector.
Retailers of U.S. breakfast cereals enjoy free television advertising
through cable channels from the United States. There are no import
restrictions and domestic production has not been able to keep up with
total demand. U.S. cereal exports are forecast to grow approximately 25
percent over the next two years. Competition from Mexico has increased
in the past year.
A. #4
B. Fresh Fruit
C.
1994 1995 1996
D. Total Market Size
E. Total Local Production Information not available
F. Total Exports
G. Total Imports
H. Total Imports from U.S. 4,594 5,000 5,500
Comments:
U.S. fresh exports to Guatemala have risen significantly over the past
several years. This trend is expected to continue as Guatemalan
consumers are expected to increase their demand for imported deciduous
fruits. U.S. grape exports are the fastest growing sub-sector with
apples second. The majority of Guatemalan grape consumption comes
during the Christmas holidays. This coincides with U.S. supply
availability and has enabled the U.S. to capture the largest share of
the Guatemalan grape market. Chilean grapes are priced very
competitively but usually do not enter the market until January. Future
apple exports will depend on Guatemalan trade policy which must become
WTO consistent. In the past, apple imports were restricted to the first
six months of the year and are controlled with import licenses.
A. #5
B. Cotton
C. 2631000
1994 1995 1996
(1,000 MT)
D. Total Market Size 30 32 35
E. Total Local Production 6 5 4
F. Total Exports 1 1 1
G. Total Imports 19 21 24
H. Total Imports from U.S. 18 21 24
Comments:
Guatemalan cotton production continues to fall as land historically
dedicated to cotton continues to find more profitable alternatives.
Guatemalan textile production for exports remains strong and is expected
to increase if the proposed NAFTA parity is implemented. There is
virtually no significant competition from other cotton producing
countries Under Guatemalan regulations, cotton produced west of the
Mississippi must be fumigated at the point of origin. Upon arrival in
Guatemala, Guatemalan inspectors could order a second fumigation if it
is deemed necessary.
A. #6
B. Wheat
C. 0410000
1994 1995 1996
(1,000 MT)
D. Total Market Size 330 345 360
E. Total Local Production 22 20 18
F. Total Exports 0 0 0
G. Total Imports 295 325 342
H. Total Imports from U.S. 240 300 320
Comments:
U.S. wheat historically has been the single most important U.S.
agricultural export to Guatemala. Over the next two-three years U.S.
exports of wheat should remain strong with possible fluctuations due to
market conditions. European milling wheat entered the Guatemalan market
in 1993/1994 because of relatively lower prices, but this has proven to
be a short-term phenomenon. Guatemalan wheat millers prefer U.S. hard
(high protein) wheats. There is very little local production of wheat,
but what is grown must be purchased by wheat millers by Guatemalan law.
A. #7
B. Tallow
C. 4113200
1994 1995 1996
(1,000 MT)
D. Total Market Size 38 38 40
E. Total Local Production 3 3 3
F. Total Exports 0 0 0
G. Total Imports 35 35 37
H. Total Imports from U.S. 35 35 37
Comments:
U.S. tallow exports to Guatemala have been very steady and are expected
to grow moderately over the next few years. Guatemala produces a small
quantity of low quality tallow. Soap manufactures have become
accustomed to the high quality U.S. tallow and are expected to increase
imports moderately over the next several years. There is no third-
country competition and there are no restrictions on inedible tallow
imports.
A. #8
B. Beef
C.
1994 1995 1996
(1,000 MT)
D. Total Market Size 40 40 42
E. Total Local Production 53 52 53
F. Total Exports 13 8 10
G. Total Imports .5 .7 1
H. Total Imports from U.S. .3 .6 .8
Comments:
Guatemala is a net exporter of beef, but there is a rapidly growing
market for quality beef imports. As Guatemala's per capita income
increases, more and more consumers are expected to demand higher-quality
meat products. The most popular U.S. beef export is frozen carcasses
and half carcasses. Guatemala also imports small quantities of beef
from Nicaragua, Honduras and Mexico when prices are low enough. This
beef, however, does not significantly compete with U.S. beef exports.
Consumers perceive U.S. meats to be of higher quality and are willing to
pay more.
VI. Trade Regulations and Standards
A. Trade Barriers, Tariffs and Import Taxes
Exporters to Guatemala enjoy an increasingly open trade regime. Imports
are not generally subject to non-tariff trade barriers, although
possible arbitrary customs valuation and excessive bureaucracy can
sometimes create delays and complications. The Government of Guatemala
applies the Common External Tariff schedule of the Central American
Common Market (CACM) to almost all agricultural and industrial goods.
These tariffs range from five to 20 percent. A seven percent Value
Added Tax (IVA) applies to most imported goods at the point of entry.
The seven percent IVA will be increased to 10 percent no later than
January 1, 1996.
While Guatemala has significantly liberalized its trade policies, it
continues to impose restrictive policies on some products. Guatemala
uses a price bands mechanism on basic grains. Guatemala successfully
renegotiated higher tariff binding levels for many agricultural products
in the Uruguay Round. Depending on market conditions, tariffs for
agricultural products competing with local production could increase,
since Guatemala has now joined the World Trade Organization (WTO) and
ratified the Uruguay Round Agreements.
B. Customs Valuation
Nontransparent customs valuation procedures are occasionally a barrier
to trade in Guatemala. Established importers of U.S. products complain
that under-invoicing of imports and outright contraband is widespread,
damaging their relationship with the U.S. exporter, as well as their
ability to compete.
Guatemala employs an arbitrary product valuation system for poultry
imports that results in a higher level of effective protection than
would be implied by the nominal tariff rate.
C. Import Licenses
Guatemala allows the import of wheat flour by permit only. The system
is intended to protect local wheat producers as well as to compel price
restraint by local flour mills. No permits were issued in 1992 or 1993.
There are no other significant import licensing issues.
D. Export Controls
Guatemala operates a one-stop window for the granting of export permits.
The average exporter is able to receive authorization within four to
five hours.
E. Import/Export Documentation
All commercial invoices and bills of lading must be legalized at the
Guatemalan Embassy or one of its Consulates in the United States.
Pharmaceuticals, cosmetics and hygiene products must be included in the
Sanitary Registry (Registro Sanitario) of the Ministry of Public Health
and Social Assistance prior to being sold in Guatemala. Firms
interested in exporting such products to Guatemala are required to
present a "Certificate of Free Sale" prepared by an appropriate U.S.
state or federal agency. For more information, firms should contact the
Directorate General of Health Services at the following address and
telephone number.
Direccion General de Servicios de Salud
Ministerio de Salud Publica y Asistencia Social
10 Ave. 14-00, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 2-73-03 (5 digits only)/50-01-08
F. Temporary Entry
Guatemala's 1989 drawback and export promotion law allows duty and tax
free entry of raw materials, intermediate products, packaging and labels
used in the production or assembly of merchandise exported to markets
outside Central America.
G. Labeling/Marketing Requirements
Importers must register any food product to be imported with the
Department for the Registry and Control of Foodstuffs. The registration
is valid for one year. In addition to the range of product information
required for registration, Guatemalan law officially requires that
foreign products contain Spanish-language labeling indicating the
ingredients, registration number, and expiration date of the product.
This legal requirement is frequently ignored and the shelves of modern
stores and supermarkets are commonly full of food products labeled only
in English. Nevertheless, U.S. exporters of food products should
provide Spanish-language labeling in accordance with the law to avoid
problems.
H. Prohibited Imports
The Ministry of Defense's Department for the Control of Arms and
Munitions (DECAM) enforces a law which virtually prohibits the import of
offensive weapons, a category encompassing automatic type weapons, as
well as a range of military weapons and hardware.
It should also be noted that the U.S. Government requires firms to
obtain an export permit to export all arms, ammunition and related
products to Guatemala. For more information, U.S. exporters should
contact the Bureau of Export Administration at the U.S. Department of
Commerce, tel: (202) 482-5811.
I. Standards
The market has been largely self-regulating in packaged quantities and
product quality. The Ministry of Economy has proposed the establishment
of a consumer protection office designed to verify measurements and
quality, which has yet to be established.
J. Free Trade Zones/Warehouses
The "ZOLIC" free trade zone at Puerto Santo Tomas de Castilla, adjacent
to Guatemala's principal port on the Atlantic coast, and the Grupo Zeta
Free Zone located in the town of Palin near Guatemala City, offer
exemption from payment of all duties and taxes (except employer social
security contributions). Legislation passed in 1989 allows the
establishment of privately owned and operated free trade zones and
provides export incentives for maquila (draw-back) and other export
oriented industries whenever located.
K. Membership in Free Trade Arrangements
The Central Americans reestablished a uniform external tariff range
(five to 20 percent) as of April 1, 1993, and are working to establish a
common external tariff system. Internally, they are striving to
establish a true free trade zone, with duties eventually to be
eliminated on all but four designated products. A revised Protocol for
economic integration, setting out broader goals such as financial market
integration and macroeconomic coordination, was signed by six Central
American countries (Belize is at present not included) in October, 1993.
The integration protocol allows the countries of Central America to
advance at varying rates toward more open trade, and the "Northern
Triangle" countries -- Guatemala, El Salvador and Honduras -- have moved
most rapidly to eliminate trade barriers among themselves.
VII. Investment Climate
A. Openness to Foreign Investment
Guatemala can be an attractive place for foreign investors. Close to
the United States, Guatemala possesses a large labor pool and enjoys
preferential access to the U.S. market through the CBI (Caribbean Basin
Initiative) and GSP (Generalized System of Preferences). Because of
these programs, and good agricultural conditions, nontraditional exports
have enjoyed very healthy growth over the last decade.
In addition to maintaining a stable macroeconomic environment, the De
Leon Administration actively welcomes foreign investment. Foreign
investors are generally afforded national treatment and face very few
formal constraints on investment. Most of the restrictions,
requirements and approval mechanisms typically found in such laws do not
exist in Guatemala; e.g there is no general requirement for local equity
participation.
Foreign companies must comply with significantly more protracted
registration procedures than those faced by Guatemalan firms. All firms
wishing to operate in Guatemala must formally incorporate here, publish
their intent to conduct business and register with the Ministry of
Economy. Foreign firms must meet these same conditions, demonstrate
solvency, and solicit the approval of the Ministry of Government and the
Attorney General's Office. As a result, foreign companies can face a
long delay whereas local companies usually receive provisional approval
to begin operations within a few weeks. Although these additional
requirements present a significant delay, they are not used specifically
to screen or discriminate against foreign companies. The government is
attempting to consolidate registration procedures in a one-stop-shop for
investors and simplify and shorten registration procedures, but some
legislative changes will be necessary before the registration of foreign
companies can be measurably streamlined.
B. Conversion and Transfer Policies:
There are no restrictions on converting or transferring funds associated
with an investment into a freely usable currency (U.S. dollars) at a
legal market clearing rate. U.S. dollars are freely available and easy
to obtain within the Guatemalan banking system. There are no legal
constraints on the quantity for remittances or any other capital flows.
There are no restrictions on the repatriation of capital or profits.
C. Expropriation and Compensation:
The Constitution guarantees prompt compensation for any expropriation
and specifically prohibits confiscatory taxation. The government has
taken no expropriation actions since the 1950s and we do not foresee any
expropriations in the future.
D. Dispute Settlement:
The Government of Guatemala has not been a party to any major investment
disputes in the recent past. Under Guatemalan law, all investment or
contract disputes with the government fall under the jurisdiction of an
Administrative Dispute Court. Guatemala has signed the New York
Convention on the Enforcement of Foreign Arbitral Awards and the
Interamerican Convention on Arbitration (the Panama Convention).
Guatemala has not, however, enacted any special procedures for dealing
with international arbitration clauses or awards under the New York
Convention, or with international arbitration generally. Guatemala does
not belong to the World Bank International Center for the Settlement of
Investment Disputes (ICSID).
The standard procedures for enforcing agreements are clumsy and poorly
implemented. Theoretically, Guatemalan procedures are not much
different from those of the United States. In practice, however,
Guatemalan procedures are less transparent and more time-consuming. The
time required to complete these procedures can be significant and
Guatemala does not allow the parties to proceed to arbitration or obtain
a default award until those procedures are completed. The government
has committed to streamline these procedures and to make them consistent
with the New York and Panama Conventions.
The procedures for enforcing foreign awards are even more cumbersome.
The party against whom enforcement is sought can raise a number of
procedural objections through the judicial process, in a manner that is
inconsistent with the New York Convention.
E. Political Violence:
While the 35-year old insurgency continues in Guatemala, mainly in rural
areas and at a low level of violence, there has been very little
political violence directed at foreign firms operating in Guatemala.
The greatest security threat to anyone in Guatemala, citizen and
foreigner, is crime.
F. Performance Requirements/Incentives:
With few exceptions, investment incentives are specified in law and
available to both foreign and Guatemalan investors without
discrimination.
The major Guatemalan incentive programs are aimed at "maquiladora"
operations - manufacturing or assembly operations for which machinery,
supplies and components are imported and the completed products are
exported. Incentives include suspension of all import duties and value
added taxes on imported machinery and inputs to production. Investors
are also granted a 10 year income tax holiday and real estate tax
holidays of varying length depending on the type of investment.
Income taxes are not leveied for 10 years on industrial firms and five
years for commercial firms operating in free trade zones. Import duties
and value added taxes are not applied to inputs used for export
production in free trade zones. Companies investing in free trade zones
are granted a five year real estate tax holiday.
The government also provides incentives for forestry, mining, tourism
and petroleum investments.
-- Property owners who engage in reforestation activities can qualify
for a real estate tax exemption and can deduct the costs of these
activities from their income taxes.
-- In petroleum, 100 percent of the exploration and drilling expenses
are recoverable. Petroleum investors are eligible for tax free imports
of most inputs for five years and suspension of duties without bond on
items to be re-exported.
-- Mining and renewable energy projects qualify for duty-free imports
for goods that are not produced locally. Capital goods used in hydro-
electric projects (but not thermoelectric) may be imported duty free.
-- Firms involved in developing projects in designated tourism zones are
eligible for real estate tax exemptions. They can also import goods
duty free that are not manufactured anywhere in Central America.
G. Right to Private Ownership/Establishments:
The right to hold private property and engage in business activities is
specifically recognized by the Constitution. Both foreign and domestic
private entities may establish and own business enterprises and other
remunerative activities. This includes the right to freely establish,
acquire and dispose of virtually any type of business interest. There
are few cases in which competitive equality with public enterprises does
not apply.
H. Protection of Property Rights:
Guatemalan law permits foreigners to acquire, hold and dispose of real
property and tangible personal property with few restrictions. However,
foreigners are prohibited from owning land adjacent to rivers and
oceans.
The level of protection provided to intellectual property remains
inadequate. The criminal code contains ineffective penalties for
infringement of intellectual property rights and a poorly trained
judiciary is slow to provide effective relief.
Copyrights: Copyrights are protected under a 1954 law that provides
protection for literary and artistic works for 50 years after the
authors death. While the right to copy, publish and distribute is
clearly protected, control over leasing or renting of protected works is
not clear under Guatemalan law. Despite Guatemalan membership in the
Rome and Geneva Conventions, Guatemalan law does not generally protect
sound recordings. Nor do Guatemalan copyrights extend to databases,
audiovisual works and software. Legislation was enacted two years ago
prohibiting the pirated use of satellite television transmissions for
commercial use. As a result, unauthorized retransmission of signals has
declined markedly.
In a new law currently under consideration by the Guatemalan Congress,
which is expected to be passed in late 1995 or early 1996, copyright
protection would be extended to database and computer programs, and a
procedure for copyright registration in a new Registry of Intellectual
Property would be added. In addition, penalties for copyright
enforcement would be clarified and strengthened, with fines ranging from
50,000.00 to 100,000.00 quetzales and prison terms of 4-6 years. The
Guatemalan Government has also requested that the Congress ratify the
Berne Convention.
Patents and Trade Secrets: Guatemala's patent law dates from 1985 and
provides 15 year protection for the majority of patentable products,
with only 10 year protection for food and beverage products and
pharmaceuticals. No coverage is provided for plant varieties, trade and
commercial secrets or integrated circuits. Patent rights do not extend
to any action executed in the pursuit of education, research,
experiments or investigation. Patent rights do not prevent the
importation of counterfeits unless the product is being produced in
Guatemala. There are compulsory licensing provisions and local
exploitation requirements; protection lapses after six years from the
date of the patent if the product is not being produced locally.
A new patent law currently in the Guatemalan Congress and expected to be
approved in late 1995 or early 1996, would provide 20 year patent
protection and coverage for plant varieties, trade and commercial
secrets and integrated circuits. The new law would also strengthen
fines for patent infringement, stipulating penalties of 4-6 years in
prison and fines of 50,000.00 to 100,000.00 quetzales. The Guatemalan
Government has also requested that the Congress ratify the Paris
Convention.
Trademarks: The Central American Convention for the Protection of
Industrial Property (CACPIP) forms the legal basis for the protection of
trademarks in Guatemala. Guatemalan law does not provide for sufficient
protection against counterfeiters nor does it afford adequate protection
for internationally famous trademarks. The right to exclusive use of a
trademark, for instance, is granted to whomever happens to file first to
register the trademark. There is no requirement for use nor any
cancellation process for non-usage. As a result, foreign firms whose
trademark has been registered by another party in Guatemala have often
had to pay royalties to that party.
The CACPIP was revised by the Central American Ministers of Economy to
include protection for internationally-famous trademarks in November
1994, but will not enter into effect in the region until at least two of
the five Central American national legislatures ratifies the revision.
Ratification by the Guatemalan Congress is expected in late 1995 or
early 1996.
I. Regulatory System:
Bureaucratic hurdles are common for both domestic and foreign companies
wishing to operate in Guatemala. Not infrequently, companies are
subject to ambiguous requirements, applied inconsistently by different
government agencies. Regulations - where they exist - often contain few
explicit criteria for the government decision maker, creating
uncertainty. Public participation in the promulgation of regulations is
rare and there is no consistent judicial review of administrative rule
making. Customs administration is particularly problematic, with
inconsistent classification and valuation of imports, frequent delays at
the border and widespread corruption.
Few restrictions remain on foreign investment. As noted above, the
Constitution provides the state telephone company, Guatel, with a
monopoly on most telecommunication services. The Constitution also
designates all subsurface minerals, petroleum and other resources as
property of the state. Concessions are typically granted in the form of
production-sharing contracts. However, the solicitation and contracting
process for energy concessions tends to be protracted and non-
transparent. Some foreign oil companies also complain that the
Guatemalan royalty scale is not competitive with that of many other
countries.
In addition, only Guatemalan citizens or corporations which are at least
75 percent owned by Guatemalans can operate radio or television
stations. Foreigners can own no more than 30 percent of "small mining"
or forestry companies. Ground transportation is limited to companies
with at least 60 percent Guatemalan ownership. Licensing requirements
for fishing operations are enforced in such a way as to ensure at least
minority Guatemalan participation. Only airlines with at least 51
percent Guatemalan ownership can provide domestic service.
J. Bilateral Investment Agreements
In October 1991, the United States and Guatemala signed a Framework
Agreement on Trade and Investment, establishing a binational Trade and
Investment Council. The Council is designed to discuss general issues
related to trade and investment. Guatemala has also signed investment
agreements with the Republic of Korea, Germany and Taiwan. Guatemala is
party to a number of other bilateral agreements that deal partially with
investment issues. The government is studying a draft bilateral
investment treaty proposal by the United States.
K. OPIC and Other Investment Insurance Programs:
The Overseas Private Investment Corporation (OPIC) is active in
Guatemala, providing both insurance and investment financing. Obtaining
Foreign Government Approval (FGA) for OPIC applicants can be slow but
the government hopes to speed the process by eventuallually
incorporating it into a one-stop-shop for investors, which is still
pending. In the meantime, the government has been making an effort to
speed up the process for the granting of FGA; in one recent case, FGA
was granted in 3 1/2 days for a high priority electric power project
that was being undertaken by a U.S. company in collaboration with some
minority local partners. Guatemala has also joined the Multilateral
Investment Guarantee Agency. For more information on OPIC programs,
U.S. investors should contact OPIC headquarters in Washington, D.C. at
tel: (202) 336-8502.
L. Labor:
The minimum wage and maximum weekly working hours are established by law
and are revised periodically. The labor code provides the right to
organize employee associations and labor unions. Most labor unions are
in the public sector, although private sector unionization has increased
recently. Unions remain relatively small, with less than 1 in 14
workers belonging to a union. By law, at least 90 percent of any
company's work force must be Guatemalan and no company operating in
Guatemala can spend more than 15 percent of its total wage bill on non-
Guatemalan employees.
The labor code also specifies employer responsibilities for working
conditions, benefits, safety standards, severance pay and bonuses.
Employers are required to pay a bonus equivalent to a month's salary in
July ("Bono 14") and again in December ("Aguinaldo"). The law
establishes a two month probation period. If dismissed after more than
two months employment, employees receive separation pay equal to one
month's salary for each year worked. Employers are required to make a
contribution for social security. In total, these required benefits
raise the average wage bill by approximately 62 percent.
More than a third of the total work force has had no formal education.
Another fifth has had only a primary school education. Although the
choice of inputs varies greatly by industry, the availability of a
large, unskilled and inexpensive labor force has led many employers,
such as construction and agricultural firms, to use labor intensive
production methods. In contrast, shortages of skilled manual workers,
particularly in construction, and of management and information
processing professionals occur occasionally.
M. Foreign Trade Zones:
There are currently two free trade zones in operation in Guatemala,
Grupo Zeta in Palin (a small city located 30 kilometers from Guatemala
City) and Zolic in Puerto Santo Tomas de Castilla (a major port located
on the Atlantic Coast approximately 300 kilometers from Guatemala City).
Palin is privately owned and Puerto Santo Tomas de Castilla is
government owned.
Legislation passed in 1989 allows establishment of privately owned and
operated free trade zones in Guatemala.
N. Capital Outflow Policy:
Capital can be exported from Guatemala to any other place without
restrictions. Guatemalan investors historically have not been investors
in businesses outside of the country, except in perhaps other Central
American countries.
O. Major Foreign Investors:
Abbott Laboratories AT&T
Colgate Palmolive Upjohn Pharmaceuticals
IBM Proctor and Gamble
Kellogs United Airlines
American Airlines Continental Airlines
Ralston Purina ENRON Corporation
Texaco ESSO
Sealand American Express
TECO Power Services Citibank
DHL Pepsi
Coca-Cola Gillette
Maersk
VIII. Trade and Project Financing
A. Brief Description of Banking System
Capital markets in Guatemala have been developing rapidly in recent
years but remain fairly shallow. There are now 31 private commercial
banks, up from 21 just three years ago. Citibank is the sole U.S. bank
operating as a bank in Guatemala. There are also 15 investment firms
that specialize in somewhat longer term credit, 12 bonded warehouses
that issue warrants against the goods they hold, and five new exchange
houses. A large number of cooperatives provide credit to a variety of
small and medium businesses under the supervision of the Ministry of
Economy. Also a number of informal financial institutions operate
independently of any government supervision. These include parallel
exchange houses, informal investment firms, and traditional rural
moneylenders.
Government intervention in the financial sector is limited to
implementation of monetary policy and to prudential regulation of the
banks, investment firms, bonded warehouses and exchange houses. Credit
is not rationed or otherwise directed by the government with the minor
exception of a small amount of lending subsidized by the government -
principally for small businesses, small farms or low-income housing.
Two "stock" exchanges provide a limited alternative to the traditional
financial sector. The exchanges trade almost exclusively in government
bonds and corporate paper, and are much smaller than the commercial
banking sector. Repurchase agreements dominate the markets, accounting
for over three quarters of total volume. To-date, there have been no
equity issues. Three government bonds (the CENIVACUS, CERTIBONO and
CDP) are now traded on the exchanges. Secondary trading of both
government bonds and corporate paper is active, relative to the size of
the market. Trading in currency futures has also recently begun with
the liberalization of the exchange market.
B. Foreign Exchange Controls Affecting Trading
Guatemala maintains an open, relatively undistorted exchange regime.
There are no legal constraints on the quantity for remittances or any
other capital flows. In early 1994, the Bank of Guatemala (BANGUAT)
moved to a dirty float; although BANGUAT still intervenes occasionally,
there are no longer any delays in acquiring foreign exchange. The
government sets only one reference rate, which it applies only to its
own transactions and which is based on the commercial rate. Remittances
can take the form of dollar denominated government bonds, although the
supply of these is rather limited. A number of banks also offer "pay
through" dollar-denominated accounts; the depositor makes deposits and
withdrawals at a local bank but the account is actually maintained, by
the local bank on behalf of the depositor, in a U.S. bank.
C. General Financing Availability
The overwhelming bulk of credit is allocated by commercial banks on
market terms. The three largest banks hold almost a third of all
deposits, accounted for over a quarter of all loans and own over a
quarter of all assets. Most lending takes the form of short term and/or
signature loans. However, small and medium sized businesses complain
that it can be difficult to find operating capital: i.e. that commercial
lending is concentrated among a relatively small group of the large
borrowers. Foreign borrowers face no systematic discrimination in terms
or access.
Under its Financial Modernization Program (FMP) with the Inter-American
Development Bank, the government is attempting to make credit more
widely available, stretch out the term of most lending, and make
interest rates more competitive. The FMP also has tightened
requirements for reclassifying non-performing assets, for information
disclosure, and for avoiding lending to directors and owners.
Accounting practices have also been made uniform and external audits are
now required of financial institutions. In general, the government is
improving both prudential regulation and information disclosure.
Another objective of the FMP is to increase the number of instruments
available in Guatemalan financial markets and remove some of the
restrictions on the types of services banks and other financial
institutions offer.
D. How to Finance Exports/Methods of Payments
The most secure means of payment is cash in advance or an irrevocable
letter of credit. However, many Guatemalan imports are financed through
short term (typically 60 day) lines of credit. Generally, these are
extended directly by the U.S. exporter to the Guatemalan importer. This
method of financing is usually only available to large importers and
long-term clients. The larger Guatemalan importers frequently have
their own source of capital abroad which can be used to finance or to
leverage financing for imports. U.S. exporters should excercise caution
when extending credit. The pursuit of claims against Guatemalan firms
for lack of payment can be time-consuming and costly.
E. Types of Available Export Financing and Insurance
The Export-Import Bank of the United States (EXIMBANK) is active in
Guatemala and offers a number of programs to assist U.S. firms to export
successfully to Guatemala and elsewhere. EXIMBANK has published a
booklet entitled "General Information: Central America" which provides
information on all relevant programs available for exporters doing
business in Guatemala and Central America. U.S. exporters should
contact EXIMBANK at tel: (202) 565-EXIM/(800) 565-EXIM and fax: (202)
565-3931.
The U.S. Trade and Development Agency (TDA) has been involved in
financing a few public and private pre-feasibility and feasibility
studies and technical assistance programs for high priority development
projects in Guatemala that have the potential to generate significant
exports of U.S. products and services, most notably with the National
Electrification Institute (INDE). U.S. firms interested in learning
more about TDA and its activities in Guatemala should contact the agency
directly at tel: (703) 875-4009 and fax: (703) 875-4357.
F. Project Financing Available
Since domestic credit tends to be expensive unless guaranteed by a
government agency, many businesses look abroad for project financing,
despite the exchange risk. A large multinational recently sold bonds in
Europe and the United States to partially finance an energy project.
That project, and others have also been partially financed by the World
Bank's IFC. However, a number of recent projects, even those of larger
foreign firms, have recently encountered some difficulty in locating
international funding. Smaller projects usually must be financed
domestically, either out of a company's internal assets or from the
formal financial system.
Both the U.S. Trade and Development Agency (TDA) and the U.S. Overseas
Private Investment Corporation (OPIC) are operating in Guatemala and
have been supportive of U.S. firms seeking to undertake projects in
Guatemala that have the potential to generate substantial exports of
U.S. products and services.
G. Banks with Correspondent U.S. Banking Arrangements
Given the importance of the United States as a trading partner, almost
all of Guatemala's commercial banks maintain correspondent relations
with U.S. banks.
IX. Business Travel
A. Business Customs
Most business is conducted in Guatemala based on personal relationships.
Guatemalan business executives and government officials place great
importance on personal contacts with suppliers. U.S. suppliers should
be prepared to have a local representative or distributor and to travel
to Guatemala personally. Travelers often are surprised at the
accessibility to key decision makers and by the openness and frankness
of local buyers.
Promotional material should be in Spanish and emphasize U.S. origin.
Though many private and public officials speak and read English, many
technicians and engineers do not. Guatemalans are extremely receptive
to technical presentations that are educational rather than sales
oriented.
B. Travel Advisory and Visas
Entry requirements: A passport is required for travel into Guatemala.
A visa is required if an official or diplomatic passport is used. If a
tourist passport is used, a tourist card good for thirty days can be
purchased at La Aurora International Airport upon arrival or at the port
of embarkation in the U.S. for US$5.00 (U.S. currency only). A visa is
required for any stay over thirty days. Visas are available from the
Guatemalan Embassy at 2220 R Street N.W., Washington, D.C. 20008, tel:
(202) 745-4952, or Guatemalan consulates in Los Angeles, San Francisco,
Miami, New Orleans, New York, Houston or Chicago.
There currently is a U.S. travel warning in effect for Guatemala, which
excludes the normal business and tourist centers. U.S. citizens
travelling to Guatemala should contact the Department of State in
Washington, D.C., tel: (202) 647-5225 for travel information and to find
out if there is a Travel Warning in effect at the time of travel.
C. Holidays
Holidays in Guatemala are keyed to dates, not days of the month or week
(except for Holy Week) so they are the same every year. The following
are the (commercial) holidays.
New Year's Day January 1
Holy Week/Wednesday April 3, 1996 (p.m.only)
Holy Thursday April 4, 1996
Good Friday April 5, 1996
Holy Saturday April 6, 1996
Easter Sunday April 7, 1996
Labor Day May 1
Army Day June 30
Feast of Assumption August 15
Independence Day September 15
Revolution Day October 20
All Saints Day November 1
Christmas Eve December 24 (p.m.only)
Christmas Day December 25
New Year's Eve December 31 (p.m.only)
In addition, the banking sector celebrates the following holidays:
Bank Workers's Day July 1
Columbus Day October 12
Business travelers should avoid arriving in Guatemala on a holiday, if
possible, because of the unpredictability of transportation and other
services, especially during the Holy Week, when almost everything is
closed and tourist facilities are crowded.
D. Business Infrastructure
Language: Spanish is the official language in Guatemala. Many firms
are accustomed to working in English. However, correspondence should be
in Spanish. Catalogs and technical literature should be provided in
careful translations.
Currency: The official currency unit is the Quetzal. The exchange rate
as of July 1995 is approximately Q5.75 to US$1.00. Generally, the
exchange rate fluctuates minimally. Currency exchange facilities are
available at the airport terminal. Major credit cards are accepted at
most major hotels, restaurants and stores.
Business hours: Business hours for commercial and industrial firms are
from 08:00 to 18:00, Monday through Friday. It is not unusual for
offices and businesses to be closed from 12:30 to 14:30 or 13:00 to
15:00 for lunch.
Transportation: Taxi service is available between the airport and
hotels. Travelers arriving at La Aurora International Airport should
only hire vehicles marked clearly as taxis and bearing a registration
number on the left and right side doors. The taxi fare from the airport
to most of the business hotels is approximately US$6.80 or Q40.00.
Use of taxis within the city is strongly recommended as public bus
transportation is not up to U.S. standards. Taxis are available at the
hotels and if transportation is required from a company or restaurant to
the hotel or other places, a taxi should be requested by phone. Taxis
are not commonly available in the streets.
Communications: Basic telephone service is easily available at most
hotels and offices in Guatemala City. Generally, calls can be placed to
the U.S. without any problem. Calls can be placed through the hotel
operator (via the Guatemalan Telecommunications Company-GUATEL) or
directly (calling card or collect) via AT&T (dial 190), MCI (dial 189)
and Sprint (dial 195).
Hotel Accomodations and Housing: Hotel accomodations are abundant in
Guatemala City and in the major tourist areas, such as Antigua Guatemala
and Panajachel. Most U.S. business visitors to Guatemala City stay in
the following hotels located in Zones 9, 10 and 13.
Hotel Westin Camino Real
14 Calle y Avenida La Reforma, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 33-46-33
Hotel El Dorado (Marriott Guatemala City starting July 1996)
7 Avenida 15-45, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 31-77-77
Hotel Princess Reforma
13 Calle 7-65, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 34-45-45
Hotel Crowne Plaza Las Americas
Avenida Las Americas 9-08, Zona 13
01013 Guatemala, C.A.
Tel: (502-2) 39-06-76
Hotel Radisson Suites-Villa Magna
1a Avenida 12-46, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 32-97-97
For those firms planning to locate staff on a more permanent basis in
Guatemala there are a number of real estate brokerage firms and
independent agents that speak English and work with expatriate
government officials and business people seeking apartments and houses.
Rents are relatively expensive for housing that meets U.S. standards; it
is not wise to rent an apartment or house that does not already have
functioning telephone service. Most foreign government officials and
business executives live in Zones 10, 14, 15 and on the Carretera a El
Salvador. The Commercial Section of the Embassy can assist U.S. firms
in obtaining names of residential real estate agents.
Health: A full range of basic medical care is available in Guatemala
City, but medical care outside of the city is limited. Care in private
hospitals is generally adequate for common illnesses and injuries.
Cholera is present in Guatemala and hepatitis A is endemic. U.S.
medical insurance is not always valid outside the United States.
Travelers often find that supplementary medical insurance with specific
overseas coverage is useful. Additional health information may be
obtained from the Centers for Disease Control's international travelers
hotline at (404) 332-4559.
Food: Guatemala has numerous excellent restaurants suitable for
business meals and costs are reasonable by international standards.
Business persons should eat their meals at their hotels or in one of the
many modern clean restaurants. Improperly washed or cooked foods are
the principal cause of the simple diarrheas, food poisoning and
bacillary and amoebic dysentery. Only well-cooked foods served while
hot are recommended, except for fruits and vegetables that can be
peeled. It is not advisable to eat fruits or raw vegetables with a
broken skin and which have not been well washed and peeled or skinned.
Beverages: It is advisable to drink bottled drinking water or one of
the well-known brands of carbonated drinks. These can be obtained at
the hotel, restaurants or in supermarkets and mini-markets.
Climate: Guatemala is at 5,000 feet and has a temperate climate;
spring/fall weight clothing is most comfortable.
Crime: The main security threat in Guatemala is street crime. It is
advisable not to wear valuable jewelry nor carry large amounts of cash.
Leave valuables in the hotel's safe deposit box. It is generally
accepted advice not to resist a would-be thief or mugger. If interested
in visiting restaurants/nightspots in other zones of the city, it is
convenient to do it with others and obtain taxis from the hotel front
desk. The loss or theft of a U.S. passport abroad should be reported
immediately to the local police and the nearest U.S. embassy or
consulate.
X. Appendices
A. Country Data
Population in 1993: 10.3 million.
Population growth rate: 2.9 percent per year.
Religions: Roman Catholic, Protestant, Traditional Mayan.
Government System: Constitutional Democratic Republic.
Languages: Spanish, 23 Mayan languages (e.g Quiche, Cakchiquel and
Kekchi).
Work Week: 8:00 AM to 6:00 PM, Monday thru Friday, with a lunch break
that can begin between 12:30 PM and 1:30 PM and last 1 1/2 to 2 hours.
B. Domestic Economy
1994 1995 1996
GDP/1 12,006 12,931 13,926
Real GDP growth (percent) 4.0 4.0 5.0
GDP per capita (dollars) 1,166 1,220 1,277
Govnt Spending (percent of GDP) 10.9 11.7 12.5
Inflation (percent) 11.6 8.0 8.0
Unemployment Rate (percent)/2 5.5 4.6 3.6
Foreign Exchange Reserves 800 800 800
Average Exchange Rate (Q/$)/3 5.77 6.00 6.24
Debt Service Ratio (percent) 14.4 15.7 12.6
US Bilateral Aid (fiscal year, millions) 56.9 35.8 35.8
C. Trade/5: 1994-1996
1994 1995 1996
Total Country Exports 1,503 N/A N/A
Total Country Imports 2,780 3,030 3,310
U.S. Exports 1,354 1,490 1,639
U.S. Imports 1,282 1,411 1,552
Notes
All figures are based on Bank of Guatemala data and are in millions of
dollars, unless otherwise noted.
/1 GDP in quetzales divided by average nominal exchange rate
/2 Projections of Guatemalan Planning Agency, SEGEPLAN (underemployment
is estimated to exceed 50 percent)
/3 Based on BANGUAT projections of zero real appreciation in the
quetzal.
/4 consolidated public sector foreign debt
/5 Based on Guatemalan Customs Data
/6 US Department of Commerce
D. Foreign Direct Investment
Cumulative U.S. investment in Guatemala is estimated to be at least
$700.00 million spread out in more than 200 enterprises, U.S. companies
account for the vast majority of foreign investment in Guatemala. For
the past five years, foreign direct investment (FDI), as a percentage of
GDP, has remained about 0.9 percent. During that time, FDI in Guatemala
has fallen below the average for Latin America, as other countries in
the region have benefited more from the recent boom in foreign
investment throughout the hemisphere. In 1994, FDI was estimated to be
approximately $152.00 million. In 1993, FDI was estimated at $99
million. An accurate breakdown of investment is not available in
Guatemala. When investors register, they are required only to list an
initial investment of $5,000. Most investors list only the minimum
initial amount. Subsequent investment flows, along with export
earnings, are reflected only as net changes in dollar holdings by the
banking system.
E. U.S. and Country Contacts
Country Government Agencies
Contact names are omitted, since there will be a new Government
installed on January 14, 1996.
Please Note that Guatemalan local telephone numbers usually consist of
only six digits, however, there are some telephone numbers with only
five digits.
Ministerio de Economia
(Ministry of Economy)
8 Ave. 10-43, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 51-86-06, 51-50-86, 53-09-03
Ministerio de Finanzas Publicas
(Ministry of Public Finances)
8 Ave. y 21 Calle Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 53-74-84, 53-32-84, 51-35-42
Registro Mercantil
(Mercantile Registry)
6 Calle 7-57, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 2-07-19, 2-04-81, 2-01-51
Registro Propiedad Industrial
(Industrial Property Registry)
5 Calle 4-31, Zona 1
Edificio Plaza Rabi, 7o Nivel
01001 Guatemala, C.A.
Tel: (502-2) 30-16-92/7, 30-18-22/5
Ventanilla Unica de Inversiones
(One-Stop Investment Office)
8 Ave. 10-43, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 8-33-31, 8-33-32, 83-33-33, 83-33-34
*Not really functioning yet.
Aduana Central
(Central Customs)
10 Calle 13-92, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 51-62-62, 51-30-24
Ministerio de Comunicaciones, Transporte y Obras Publicas
(Ministry of Communications, Transportation and Public Works)
Palacio Nacional, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 51-27-69, 39-33-33, 8-29-75
Guatel - Empresa Guatemalteca de Telecomunicaciones
(Guatemalan Telecommunications Company)
7 Ave. 12-39, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 8-33-80, 53-10-42, 53-23-98
Ministerio de Trabajo y Prevision Social
(Ministry of Labor and Social Welfare)
14 Calle 5-49, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 8-25-22, 51-56-44, 30-13-66
Ministerio de Relaciones Exteriores
(Ministry of Foreign Relations)
Palacio Nacional, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 2-67-48, 39-33-33, 51-65-09, 53-47-88
Ministerio de Energía y Minas
(Ministry of Energy and Mines)
Diagonal 17, 29-78, Zona 11
01011 Guatemala, C.A.
Tel: (502-2) 76-24-59, 76-06-82, 76-20-44
INDE - Instituto Nacional de Electrificacion
(National Electrification Institute)
7 Ave. 2-29, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 34-57-75, 34-57-76, 34-57-11
EEGSA - Empresa Electrica, S.A.
(Guatemalan Electric Company)
6 Ave. 8-14, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 30-06-59, 30-06-71
Ministerio de Agricultura, Ganaderia y Alimentacion
(Ministry of Agriculture, Livestock and Nutrition)
Palacio Nacional, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 39-33-33, 53-68-16, 51-75-60
Ministerio de Gobernacion
(Ministry of Government)
Palacio Nacional, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 39-33-33
Ministerio de Salud Publica y Asistencia Social
(Ministry of Public Health and Social Assistance)
Palacio Nacional - 3er Nivel, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 39-33-33, 2-45-09, 8-02-58
INGUAT - Instituto Guatemalteco de Turismo
(Guatemalan Tourism Institute)
7 Ave. 1-17, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 31-13-33, 31-13-42, 31-13-34
BANGUAT - Banco de Guatemala
(Bank of Guatemala)
7 Ave. 22-01, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 8-16-33, 43-40-53, 53-40-53
Country Trade Associations and Chambers
Asociación de Gerentes de Guatemala - AGG
(Guatemalan Managers Association)
6 Ave. 1-36, Zona 14
01014 Guatemala, C.A.
Tel: (502-2) 32-93-32 to 36
Fax: (502-2) 32-93-42
Lic. Roberto Tenenbaum, President
Lic. Jessica Rochmann, General Manager
Gremial de Exportadores de Productos No Tradicionales - GEXPRONT
(Association of Exporters of Non-Traditional Products)
Edif. Cámara de Industria
Ruta 6, 9-21, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 34-68-72, 31-59-47
Fax: (502-2) 32-35-90
Dr. Gabriel Biguria, President
Lic. Fanny de Estrada, Executive Director
Comite Coordinador de Asociaciones Agricolas, Comerciales, Industriales
y Financieras - CACIF
(Coordinating Committee of Agricultural, Commercial, Industrial and
Financial Associations)
Edificio Camara de Industria, 4o Nivel
Ruta 6, 9-21, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 31-06-51
Fax: (502-2) 34-70-25
Lic. Roberto Ardon, General Manager
Camara de Industria de Guatemala
(Guatemalan Chamber of Industry)
Edificio Camara de Industria, Nivel 12
Ruta 6, 9-21, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 34-08-49 to 58
Fax: (502-2) 34-10-90/31-85-94
Ing. Juan Jose Gutierrez, President
Lic. Eduardo Sperisen, Executive Director
Camara de Comercio de Guatemala
(Chamber of Commerce of Guatemala)
10 Calle 3-80, Zona 1
01001 Guatemala, C.A.
Tel: (502-2) 30-51-56/30-36-28
Fax: (502-2) 51-41-97
Lic. Jorge Briz, President
Sr. Federico Pola, Manager
Camara Empresarial de Guatemala - CAEM
(Entrepreneurial Chamber of Guatemala)
Edificio Camara de Industria, 8o Nivel
Ruta 6, 9-21, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 31-65-13
Fax: (502-2) 31-65-13
Lic. Carlos Bonifasi, President
Ing. Otto Ernesto Becker, General Manager
Camara Guatemalteca de la Construccion
(Guatemalan Construction Industry Chamber)
Ruta 4, 3-56, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 31-80-52
Fax: (502-2) 31-29-39
Ing. Luis Fernando Montenegro, President
Lic. Jorge Franco, Manager
Camara de Comercio Guatemalteco-Americana
(American Chamber of Commerce of Guatemala - AMCHAM)
6 Ave. 14-77, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 37-44-89
Fax: (502-2) 68-31-06
Lic. Emilio Wong, President
Mr. Charles Chambers, Executive Director
*Affiliated to the Chamber of Commerce of the United States through the
Association of American Chambers of Commerce in Latin America (AACCLA).
Fundacion para el Desarrollo de Guatemala - FUNDESA
(Guatemalan Development Foundation)
Parque Gerencial Las Margaritas, Oficina 402
Diagonal 6, 10-64, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 32-79-52 to 57
Fax: (502-2) 32-79-58
Ing. Carmelo Torrebiarte, President
Lic. Paul Wever, Executive Director
Camara del Agro
(Agricultural Industry Chamber)
15 Calle "A" 7-65, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 31-78-28
Fax: (502-2) 31-78-28
Sr. Humberto Preti, President
Asociación Nacional del Cafe - ANACAFE
(National Coffee Association)
5 Calle 0-50, Zona 14
01014 Guatemala, C.A.
Tel: (502-2) 37-00-75, 33-75-35
Asociación de Azucareros de Guatemala - ASAZGUA
(Sugar Growers Association)
Edif. Tívoli Plaza
6 Ave. 11-08, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 318197, 313087, 340628
Country Market Research Firms
NB: There are no firms that really are dedicated exclusively to market
research. The following firms provide a wide range of business
consulting services.
Arevalo Pérez, Aranky y Asociados
(Arthur Andersen)
Centro Generencial Las Margaritas, Nivel 5
Diagonal 6, 10-65, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 32-79-39
Fax: (502-2) 31-69-14
Tulischth Diaz y Asociados
(Coopers & Lybrand)
Edificio El Triángulo, Nivel 17
7 Ave. 6-53, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 32-18-67
Fax: (502-2) 34-70-59
Tuncho Granados y Asociados
(BDO-Binder)
Edificio Plaza del Sol, Of. 413
12 Calle 2-04, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 31-97-44
Fax: (502-2) 31-42-17
Lizarralde, Ayestas, Asturias y Ramos
(Ernst & Young International)
Edificio Santa Clara II, Oficina 204
13 Calle 1-51, Zona 10
01010 Guatemala, C.A.
Tel: (502-2) 31-56-62
Fax: (502-2) 31-56-87
Aldana, Salazar, Garcia y Asociados
(KPMG)
Edificio Centro Financiero, Zona 4
Torre I, Nivel 16
7 Ave. 5-10, Zona 4
01004 Guatemala, C.A.
Tel: (502-2) 31-12-29
Fax: (502-2) 31-54-77
Cordon, Parra y Cia.
(Price Waterhouse)
Edificio Tívoli Plaza, Nivel 4
6 Calle 6-38, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 34-50-80
Fax: (502-2) 31-28-19
Lara & Coyoy
(Deloitte & Touche)
Edificio Casa, Nivel 4
7 Ave. 7-11, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 32-37-40
Fax: (502-2) 32-65-95
Bocanegra Cruz y Asociados
(Horwath International)
Edificio El Reformador, Nivel 4
Avenida La Reforma 1-50, Zona 9
01009 Guatemala, C.A.
Tel: (502-2) 345345, 351738
Fax: (502-2) 345362, 352333
Country Commercial Banks
BANCO AGRICOLA MERCANTIL (BAM)
7a. Avenida 9-11, Zona 1
01001 Guatemala, C.A.
Tels.: (502-2) 2-16-01 to 5 (five digits)
Fax: (502-2) 51-07-80
Contact: Eduardo Castillo, General Manager
BANCO AMERICANO, S.A.
11 Calle 7-44, Zona 9
01009 Guatemala, C.A.
Tels.: (502-2) 32-40-20/32-43-30
Fax: (502-2) 32-43-20
Contact: Rolando Porras, General Manager
BANCO CONTINENTAL, S.A.
6a. Avenida 9-08, Zona 9
01009 Guatemala, C.A.
Tel.: (502-2) 38-20-01
Fax: (502-2) 39-20-84
Contact: César García, General Manager
BANCO DE COMERCIO, S.A. (BANCOMER)
6a. Avenida 8-00, Zona 9
01009 Guatemala, C.A.
Tels.: (502-2) 39-05-04 to 08
Fax: (502-2) 39-05-55
Contact: Héctor Ramírez, General Manager
BANCO DE EXPORTACION, S.A. (BANEX)
Avenida de la Reforma 11-49, Zona 10
01010 Guatemala, C.A.
Tel.: (502-2) 31-98-61
Fax: (502-2) 32-28-79
Contact: Rafael Viejo, General Manager
BANCO DE LA CONSTRUCCION, S.A. (CONST