FDI in figures

Guatemala has been involved in an effort of investment promotion since 2004.  The priority is for more transparence and competition.  For 2005, the FDI total was US $ 226.8 million, in 2006 it reached US $ 353.8 that is to say an increase of 56%.
In 2007 the total amount was US $ 535 million.

Why you should choose to invest in Guatemala

Strong points

The Guatemalan market is very competitive and the country is in a very advantageous position due on one hand to its proximity with Mexico and the United States and also to the rest of Central America on the other hand.  The customs union established amongst the Central American countries and the north facilitates the transit and exchange of wealth.  Today, the FDI supplies 17.4% of the GDP.  The latest management laws that came in force have accelerated the privatizations and instigated the end of the monopolies.  In this regard, a number of private investments will be able to get established.  The preferential sectors are the food industry, telecommunications, tourism and consummer goods.

Weak points

Guatemala has the usual problems of the so-called "developing" countries.  Corruption and the weakness of the intellectual property protection system are the two most significant loopholes.  Additionally, the slowness and complexity of the administrative and bureaucratic procedures are sometimes discouraging. The lack of security and the social inequalities can be a hinderance to the development of a company as well as dilapidated road and communication network in certain geographical areas.

Government measures to motivate or restrict FDI

The community model to which Guatemala is aiming for is not as rigorous as the European Union model but there is a real economic and commercial harmonization which renders investments more secure and more structured. In addition, the country has been making large efforts, since 2004, to promote foreign investment, facilitate administrative procedures and put in place the necessary information networks for all foreign investors.  Corruption and violence are denounced and fought by the State.  The governement's view is clear. The application and the success of the objectives take time but Guatemala is clearly investing in opening up economically and commercially and the proof of this is manifest in the number of Treaties, Conventions and Agreements to which Guatemala has subscribed in the past few years.  To be noted that Guatemala is part of the MIGA: Multilateral Investment Guarantee Agency, a branch of the World Bank in charge of promoting and protecting foreign investment.  It has also ratified the OPIC: Overseas Private Investment Corporation.  Belonging to these types of institutions shows Guatemala's will to create a clean and healthy environment for investors.

Procedures relative to foreign investment

Freedom of establishment

The freedom of the investor to set up is complete, there are even incentives to attract them. With regard to regional incentives, production or assembly operations using machines or imported components are highly encouraged.  These products have to be exported outside the Central American zone.  Companies established in free trade zones are exempt of all taxes and custom duties (except for social security contributions).  For more information refer to the Investments Promotion Agency and the Guatemalan Development Foundation .

Acquisition of holdings

A majority holding interest of stock in a local company is legal in Guatemala.  There is however restrictions regarding certain sectors like the press, aviation, the navy for obvious security and independance reasons.

Obligation to declare

The country's Foreign investments promotion agency enables one to get information on the necessary authorizations for establishment.  See also INVEST IN GUATEMALA.

Competent organization for the declaration

Company Register (Spanish only)

Requests for specific authorizations

None

Finding assistance for further information

Investment aid agency

E-regulation in Guatemala

Other useful resources

E-regulations Guatemala