Doing Business in Guatemala

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There are many factors to consider when deciding to do business with another country. The United States is one of the top industrialized countries and is highly involved in trade and investments. In evaluating a countries economic situation you can learn a lot about the risks and benefits of doing business with or in that country. For the United States to do business with Guatemala the factors to be considered include: international trade, exchange rates, Foreign Direct Investment, Economic structure and performance, cultural complications, as well as Social and Political stability.
Guatemala is the most populated Central American country. The country is dominated by the private sector. The United States is Guatemala’s largest trading partner providing approximately 36% of imports and receiving approximately 42% of the country’s exports. The country of Guatemala has experienced economic growth for the past 3 years and is expected to continue these growth patterns. Guatemala’s growth is estimated to increase by approximately 3.5% in 2013.
Being a member of the Central American Common Market (CACM) which includes Costa Rica, Nicaragua, El Salvador, and Honduras; Guatemala has worked towards full implementation of a common external tariff (CET) with very little if any tariffs between the members of CACM. Tariffs on products from sources other than those of CACM have been between one and nineteen percent.
Although Guatemala would like to welcome foreign investment the complex and confusing laws and regulations seem to discourage it. The government passed a law on foreign investment in attempt to address some of the issues. Restrictions still remain on sectors including: public utilities, auditing, insurance, mineral exploitation, f...

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..., and judicial branches much like that of the United States government. Guatemala elected Perez Molina late 2011 and was inaugurated in January 2012. Since taking office Molina has taken many actions to help the economy of the country. He created a Ministry of Social Development to implement social policy. The ministry was made to help programs and support the cornerstone of the former President Colom’s antipoverty agenda.
Guatemala is considered a lower middle income developing economy by the World Bank. Improvements in political and macroeconomic stability have done little to improve levels of poverty and inequality.
Being the richest in potential export resources, Guatemala is not utilizing its natural resources to help increase the economy’s standings. Some of these resources include oil, timber, nickel, gold, petroleum, hydropower, rare woods, and fish.

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