At the CEOE headquarters
The event served to learn first-hand about the current situation of the Central American country, and analyze the main competitive advantages and instruments that facilitate investment in this market.
The president of Guatemala, Alexander Giammattei, encouraged Spanish businessmen to invest in the country Central American, during a day held in CEOE, to analyze business and investment opportunities in key sectors, such as agri-food, textile, chemical-pharmaceutical, auto parts, creative industries, infrastructure and renewable energy, among other sectors.
The Secretary of State for Commerce, Xiana Mendez; the first vice president of the Business Confederation, Miguel Garrido; and the general director of the Spanish Chamber of Commerce, Immaculate Riera, highlighted at the opening of the meeting the opening of the Guatemalan market and highlighted the existing opportunities as it is an important logistics hub in Central America.
During the course of the day, the President of the Republic, Alejandro Giammattei, accompanied by the Minister of Economy of Guatemala, Janio Rosales Alegría; from his counterpart in Public Finance, Edwin Martinez; of the superintendent of Tax Administration, Marco Livio Diaz; of the president of the Bank of Guatemala, Alvaro González RiccYo; of the ambassador of Guatemala in Spain, Monica Bolaños, and the ambassador of Spain in the Central American country, José María Laviña, analyzed the advantages of this market, thanks to the opportunities offered by nearshoring; he “Guatemala does not stop” plan; and his solidity and continued macroeconomic growth.
Furthermore, President Giammattei thanked the permanent trust placed by the Spanish business sector in the country and its commitment to strengthen trade between both nations. The event served to learn first-hand about the current situation of the Central American country, and analyze the main competitive advantages and instruments that facilitate investment in this market. The objective of the meeting was to promote bilateral economic and business relations explore joint collaboration avenues to collaborate on projects of common interest for both countries.
Bilateral relations and regional integration
In the opening session of the meeting, the Secretary of State for Commerce highlighted the excellent moment that the economic and commercial relations between Spain and Guatemala. “Trade flows between both countries have grown in the last 10 years to exceed $600 million in 2021. In 2021 alone they grew by 32% and in 2022 by almost an additional 40%. The entry into force of the commercial pillar of the Association Agreement between Central America and the European Union”, he stressed.
Furthermore, Méndez highlighted the commitment of the Guatemalan government to provide Spanish businessmen with a favorable welcome and a climate of stability and trust that results in mutual benefit: “Spain continues to be the main European investor in the country. Spanish companies have internationally recognized prestige and are leaders in key sectors such as renewable energy, water, tourism and infrastructure. This is demonstrated by the participation of many Spanish companies in emblematic projects in the region, for example, numerous hydroelectric plants have been built, including the largest in the country,” he declared.
At the same time, the vice president of CEOE, Miguel Garrido, highlighted the solid macroeconomic management that the Guatemalan government has carried out during its mandate, with a notable openness to trade, and with very favorable growth expectations in the medium term. In this sense, he also mentioned that "the investments and projects developed by Spanish companies in strategic sectors, such as telecommunications, energy and agribusiness, to name a few, show the interest and commitment of our companies to maintain and strengthen the link business between both countries, a fact that places us as the main European investor in Guatemala”he declared. The vice president of CEOE reported that there are also excellent opportunities in infrastructure operations, the chemical-pharmaceutical sector, auto parts and its emerging creative industries.
On the other hand, Garrido stressed those areas of collaboration and improvement that can serve to give a additional boost to our economic relations, and which are: the climate of security and confidence for investors; the regulatory framework that facilitates relaunching our investment there; and the need to continue promoting public-private alliance frameworks that allow undertaking the investments required for the modernization of infrastructure. Garrido also highlighted the great work that has been done with Guatemala since the Ibero-American Business Council CEIB, establishing a roadmap aimed at developing the iIntegration of Central America, and which we have been working on since Ibero-American Summit of Heads of State and Government held in Antigua.
“This great effort of work and collaboration was reflected in the commitment of your Government to continue strengthening the development of the Region. An aspect that is strengthening its integration and regional presence, within an increasingly protectionist global environment,” he pointed out.
Lastly, the general director of the Chamber of Spain, Inmaculada Riera highlighted the levers available to companies from Spain and Guatemala to increase their joint businesses: the entry into force of the commercial pillar of the Central America – European Union Association Agreement in 2019; the strategic situation of Guatemala in the region and as pEntry gate to the US market; as well as the portfolio of projects and public investment and the existence of bilateral and multilateral financing. Furthermore, according to Riera, “an aspect that is no less important is having a legally secure framework, with regulatory stability and with policies to promote economic activity on a basis of public-private collaboration.”
Plan “Guatemala does not stop”
For his part, the president of Guatemala, Alexander Giammattei, highlighted the competitive advantages of Guatemala as an ideal destination for investment, macroeconomic stability, the pro-investment laws that have been promoted since Executive Body and the “Guatemala Doesn't Stop” plan, which constitutes an unprecedented public-private effort for the economic transformation of the country and its sustainable development, which together make the Guatemalan territory the ideal destination for nearshoring.
As explained to the businessmen present, the aforementioned plan has 5 pillars and a coherent roadmap to achieve the objective of creating 15 million jobs in the next 2.5 years. This roadmap contemplates forceful actions to attract investments, competitiveness and business climate for the legal security of investors, infrastructure, human capital and tourism. In the last year alone (2022), Guatemala's Foreign Direct Investment (FDI) exceeded US$1,800 billion, with which more than 48.000 jobs were created in the country, while for this year there is a goal of US$1,700 billion.
The key to Guatemala's success, according to its President, is an important and valuable team behind it, clear goals, firm and strong discipline, and daring to do what no one else did, especially during the pandemic. Giammattei assured that customs revenue has increased by 300% and that more than 32.000 microenterprises were formalized last year, because now it is attractive to be formal, he declared.
On the other hand, Guatemala's growth, Giammattei stressed, also lies largely in the trust that the private sector has regained in the Government, which has made it easier for them to work together and coordinate. Proof of this is that during the pandemic, 5 hospitals were built in 5 and a half months, and all of this financed by the private sector.
The President also highlighted that the country's economy has grown and has remained stable, there have been implemented the most innovative laws on foreign investment y Countless free zones have been created with important incentives. “We believe that Spain is the country with which we can do the most, it is a gateway to Europe and Guatemala, an access platform to the entire region,” explained Giammattei; who also assured that Guatemala has a facilitating government that welcomes foreign investment and that, thanks to its transformation plan “Guatemala does not stop”, the country is positioning itself as the “jaguar of the Americas.”
Guatemala's Competitive Advantages
At the same time, the Minister of Economy, Janio Rosales, assured that, among the reasons why companies from any part of the world should see Guatemala as their best ally in the region, the following stand out: “the FTAs that it has signed allow greater investment in key markets, its territory offers proximity and preferential access to key global markets, its ports and airports constitute an intermodal logistics platform, it has the largest installed capacity in the northern triangle for electricity production, it offers potential investors special regimes and incentives, it has growing human talent as its most valuable resource and, through National Program for Competitiveness (PRONACOM), offers strategic prospecting, establishment and post-investment services useful for operating throughout the region.”
Rosales also placed special emphasis on the national economic agenda to position the country around the world as one of the best destinations for nearshoring, as it offers all the conditions for businessmen to find in Guatemala the best ally in the region.
At the same time, the Minister of Public Finance, Edwin Martínez, analyzed in depth the solidity of Guatemala's public finances, which will start in 2023 with a cash balance surplus to the collection of taxes; and those resources already have a specific destination in the approved budget. Martínez also highlighted that in 2022 the government of Guatemala has invested more than ever in social spending, in areas such as educational infrastructure, for example.
For its part, the superintendent of the Tax Administration, Marcos Livio Díaz, explained that Guatemala has a series of tools to improve control of tax collection, solutions to tax conflicts and adjustments, as well as collection in the customs system. According to Marco Livio Díaz, this year tax collection in the country will have a surplus of Q11 billion.
Solidity and growth of the Guatemalan economy.
During your participation, the president of the Bank of Guatemala, Álvaro González Ricci, He referred to the country's macroeconomic solidity. Proof of this is that in 2022 the country's Gross Domestic Product (GDP) will exceed 4%, to which is added an exchange rate with rates of 7.84%; while family remittances will amount to US$18,048 million, which provides exchange stability, he said.
El president of the Central Bank He also highlighted, among other things, the 16% growth experienced by Guatemalan exports, equivalent to US$15,999.1 million, while in 2023 an increase of 6% is expected, corresponding to US$16,747 million.
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