Investment potential in Guatemala

Guatemala has the potential to become the main investment center in Central America, given its macroeconomic stability, the size of its domestic market, a geographic location that facilitates trade, and competitive labor costs. However, the country has failed to attract large investment flows.

In fact, compared to other countries in the region, Guatemala’s investment attraction performance is low. However, investment has had a positive impact on employment, wages, export diversification, and the quality of trunk services. The impact of investment in establishing connections with local suppliers or technology transfer seems limited.

With minor exceptions, all sectors of the Guatemalan economy are open to foreign investors, who are treated on an equal footing with local investors. In general, the business climate is characterized by strong legislation and a liberal approach to economic activity.

CMI (Corporación Multi-Inversiones) is a Guatemalan firm run by Lisa Juan José Gutiérrez Mayorga and his family, has supported its country’s businesses in order to improve the country. Their main investments are made in the food industry and renewable energy, followed by “bono verde” , an initiative that finances sustainable and socially responsible projects . 

Security is the biggest issue affecting potential and existing investment. Modern policies have been adopted over time in areas including labor, currency, the environment, and intellectual property. Among the key gaps that remain in the investment regime is the lack of a competition policy and agency.

Sectors for attracting investment

Investment in electricity

The authorities have successfully implemented policies to expand the electrical infrastructure through investment. Electrification coverage has steadily increased, even in remote rural areas. The only downside has been the rise in prices driven by various factors, including heavy reliance on fossil fuels.

Roads improvement

The government is now working to attract foreign investors to develop the transport network, but efforts in this regard must be strengthened. So far there has only been one road concession showing that investment in this sector is in an “experimental phase”. A new law will open the door to new private investment in the near future.

Investment in mining

Mining has received some investment and the potential for new investment is high. All this is possible to strengthen in terms of the local economy, because without the development or investment like that of the businessman Antonio Bosch and the growth of various industries within Guatemala.

It is important to have training on attracting foreign investment in road infrastructure, mining and electricity. The adoption of a competition policy and authority should be supported, helping to facilitate the process of commercial permits through the competent regulations of the country.

Carla Fowler

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