Latinamerica Collection
Economy and Business in Guatemala

The economy of Guatemala is one that continues to grow and develop with each passing year. Although as stated in the general description, Guatemala has a smaller GDP per capita than such larger countries as Brazil, Chile, and Argentina, Guatemala is the most populous of the Central American countries and their GDP is growing at a rate of nearly 5% per year.

 

Agriculture in Guatemala accounts for over 22% of the country's GDP as well as half of the 5 five million person labor force. More specifically, some of the agricultural commodities produced in Guatemala include sugarcane, corn, bananas, coffee, beans, and cardamom. Additionally, Guatemala is a producer of such animals as cows, sheep, pigs, and chickens. Of these agricultural commodities, coffee, bananas, fruits and vegetables, as well as cardamom are exported to other countries. The majority of Guatemalan exports are sent to the United States as well as El Salvador and Honduras.

 

Accounting for nearly another one fifth of the GDP is industry, which includes the production of such commodities as sugar, textiles, furniture, chemicals, petroleum, metals, and rubber. The labor force attributed to the industry sector is roughly 15%. The industrial growth rate in Guatemala is 3.6% which ranks among the top 100 countries in the world. Among these industrial commodities exported are sugar, petroleum, and apparel. Also, tourism falls into the industry portion of the GDP and has become increasingly important for the country as many cities rely heavily on tourism to their respective regions.

 

Finally, services account for nearly 60% of the nation's GDP as well as 35% of the labor force. Also, Guatemala has an import relationship with many countries, especially the United States. The country imports such items as fuels, machinery, construction materials, fertilizers, and electricity.

 

The distribution of wealth in Guatemala is significantly uneven with over 55% of the population below the poverty line. Also, Guatemala has a significant deficit which remains one of the important problems requiring a timely solution. In addition to this problem are other such as curbing drug trafficking, increasing revenues, and upgrading both private and public operations. Guatemala also relies on international donors for assistance and currently receives US$250 million per year from such assistance.