Guatemala: Facts & Stats

ECONOMY

Industry:

Manufacturing and construction account for about one-fifth of GDP. Guatemalan factories produce beverages, candles, cement, pharmaceuticals, chemicals, cigarettes, foodstuffs, furniture, matches, molasses, rubber goods, shirts, shoes, soap, sugar, textiles, and apparel. More recently established firms produce electrical machinery, refined petroleum products, metal furniture, instant coffee, pasteurized milk, plastic, plywood, aluminum and tires. Handmade woven and leather goods are sold to tourists and exported.

In 2002, major manufactures included sugar, clothing and textiles, furniture, chemicals, petroleum, metals, and rubber. Heavy industry included a small steel mill located in Escuintla, and an oil refinery that had a capacity of 16,000 barrels per day. The pharmaceutical industry shrank by 53% in 1998 because several manufacturing companies had moved their businesses to Mexico. Construction, very dynamic during the first half of the 1990s, was affected by falling demand in 1996 and 1997, but grew by about 25% annually in 1998 and 1999. Electricity generation and telephone services continued to grow strongly, while oil production, thanks to a very active development policy, increased by 250% between 1992 and 1998.

Agriculture:

In 1998, only about 17.5% of the total land area of Guatemala was used for the production of annual or perennial crops, although almost two-thirds is suitable for crop or pasture use. Agriculture contributes about 23% to GDP, makes up 75% of export earnings, and employs 50% of the labor force. The principal cash crops are coffee, sugar, bananas, and cotton, followed by hemp, essential oils, and cacao.

Coffee is grown on highland plantations; most of the bananas are produced along the Atlantic coastal plain. Cash crop output in 1999 included 15,459,000 tons of sugarcane, 200,000 tons of coffee, 3,000 tons of cotton, and 733,000 tons of bananas. Nontraditional agricultural exports have greatly increased in recent years; such products include: lychee, rambutan, melon, papaya, mango, pineapple, broccoli, okra, snow peas, celery, cauliflower, asparagus, garlic, spices and nuts, and ornamental plants. Guatemala's trade surplus in agricultural products was $488.4 million in 2001.

An agrarian reform law of 1952 provided for government expropriation of unused privately owned agricultural lands, with the exception of farms of 91 hectares (225 acres) or less and those up to 273 hectares (675 acres) if two-thirds of the acreage was under cultivation. By 1954/55, 24,836 hectares (61,371 acres) had been distributed to 10,359 farmers. The law of 1952 was supplemented by an agrarian reform law of 1956, which aimed to distribute state-owned farms (fincas nacionales) to landless peasants.

2009 Food Crisis:

In September 2009, Guatemalan President Alvaro Colom has declared the lack of food and proper nutrition to be a national emergency. Colom stated that the situation is the combined result of a number of factors, including a severe drought and global warming, which have reduced the domestic food supply, and the Global financial crisis, which has reduced Guatemala's ability to import food. Colom stated that the government will immediately seek assistance from the international community for emergency food supplies.

A number of international organizations have expressed concern with Guatemala's current economic status in 2009. The United Nations World Food Programme (WFP) and the World Bank reported the following:

• Guatemala has the fourth highest rate of chronic malnutrition in the world and the highest in the Western Hemisphere.


• Approximately 75% of Guatemalans live below the poverty level, which is defined as an income that is not sufficient to purchase a basic basket of goods and basic services.


• Approximately 58% of the population have incomes below the extreme poverty line, which is defined as the amount needed to purchase a basic basket of food.


• Approximately 50% of Guatemalan children under the age of 5 now suffer from chronic undernutrition.


• In the nation's highlands, where many indigenous people live, 70% of children under age 5 are malnourished.

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