THE GEOGRAPHY (Foreign Office UK)
Area: 108,889 sq km
Population: 11,385,334 (official estimate
at mid-2000)
Capital City: Guatemala City (population:
1,015,303 at mid-2000)
People: Mayan Indians (66%) speaking
22 different languages. The rest are
Guatemalans of Spanish descent. A
small number are ‘Garifuna’ (of
Caribbean descent).
Language(s): Officially Spanish, but
there are more than 23 different
Mayan languages principally K’iche,
Kakchiquel, K’ekchi and Mam.
Commercial community speaks English.
Religion(s): Predominantly Roman
Catholic (60%). The rest are mainly
Protestants and ‘Born Again’
Christians. There are a small number
of Jewish, Moslem, Orthodox Catholic,
Buddhist, and ‘Moony’ congregations.
Currency: Quetzal made up of one
hundred centavos. Approximately
Q11.00 equal £1.00
Major political parties: As at November
2001 there were 10 registered parties:
FRG - Frente Republicano
Guatemalteco
PAN – Partido de Avanzada Nacional
Guatemalteca
URNG – Unidad Revolucionaria Nacional
Guatemalteca (part of ANN)
DIA – Desarrollo Intregral Autentico
PLP – Partido Libertador Progresista
UD – Union Democratica
LOV – La Organizacion Verde
DCG – Democracia Cristiana
Guatemalteca
PLG – Partido Laborista Guatemalteco
UN – Unidad Nacionlista
ANN – Alianza and Nueva Nación
MAS - Movimiento para Acción y
Solidaridad.
Government: Guatemala has a
unicameral Congress, comprising 113
members, elected every four years
with re-election for members. The
President is elected by universal
suffrage for a single term of four
years.
GEOGRAPHY
Guatemala is situated in Central
America and borders Mexico to the
north, Belize to the East and El
Salvador and Honduras to the South.
Mountains run through the country
from east to west and from north to
south, to the east of the Pacific coast.
There are lowlands to the north and to
the south of the mountains, towards
the Yucatan peninsula in the Atlantic
and along the Pacific Ocean coast. The
high plateau in the centre is volcanic,
and temperate in climate compared to
the hot tropical lowlands. Guatemala
has 33 volcanoes. Violent earthquakes
have, in the past, destroyed what were
small cities on average twice every
century. Modern construction is
supposed to follow California building
codes. There are black basalt volcanic
sand beaches on the Pacific Ocean and
white coral sand on the Caribbean Sea
beaches.
THE HISTORY (Foreign Office UK)
There were fishing and farming
villages in the territory that is now
Guatemala from as early as 2000 BC.
These gave rise to Maya civilisation
which reached its height between
AD600 and AD900. For several
centuries, Guatemala was a centre of
Mayan culture with one of the most
advanced pre-Colombian civilisations of
the New World.
1523-25 – The beginning of the
Spanish conquest when Pedro de
Alvarado invaded Guatemala and
defeated the indigenous rulers.
1542 - First Colonial capital, Ciudad
Vieja was ruined by floods and an
earthquake.
1543 - Antigua became the second
capital.
1776 – Guatemala City became the
third capital when Antigua was
destroyed by two earthquakes in 1773.
1821 – A declaration of independence
was drafted in Guatemala City, but
Mexico invaded and ruled until 1823.
1823-35 Guatemala joined the
Federation of the United Provinces of
Central America for a brief period.
1870s - Thoroughly modern state set
up. Separation of Church & State;
divorce, full civil rights for children
out of wedlock; universal and secular
public education.
1898-1920 – Guatemala’s first 20th
century dictator, Manuel Estrada
Cabrera opened the country to US
capital investment in railways, ports,
electricity, maritime transport and mail
service. The United Fruit Company
acquired significant landholdings, so
that by the 1930s, it was the largest
landowner, employer and exported in
Guatemala. On 8 April 1920, the
legislature found Estrada Cabrera unfit
to carry out his duties on the grounds
of mental incapacity. Subsequently,
Carlos Herrera was elected provisional
president, but was overthrown after
two months in office.
1921-1930 – General Jose Maria
Orellan became president from
1921-1926, dying of a heart attack
while in office. He was succeeded by
Lazaro Chacon from 1926-1930, who
had to resign from office after
suffering a haemorrhage. During both
presidencies Guatemala enjoyed
prosperity and democracy. The
currency was stabilised, labour unions
were organised, the education system
was expanded with an emphasis on
rehabilitation and there were
improvements in public health.
1931-1944 – The dictatorship of Jorge
Ubico, who believed he was a
reincarnation of Napolean. A vagrancy
law was instituted which punished
landless Maya if they did not work 150
days per year on planatations. Decree
816, which was introduced in 1932,
allowed landowners to take any action
necessary to protect their land and
goods. This effectively legalised the
murder of those Mayans who resisted
forced labour.
1944 – Jorge Ubico’s Government
was overthrown in June 1944 by a
combination of student strikes and a
military junta. In October ’44 the
successor military government was
overthrown.
1945 – Civilian Juan Jose Arevalo
Guzman was elected President.
1950 – Colonel Jacobo Arbenz elected
President.
1954 – Colonel Jacobo Arbenz was
forced to resign when an US-backed
group led by Colonel Carlos Castillo
Armas invaded the country from
Honduras.
1958 – Gen Ydigoras Fuentes assumed
the presidency following the murder of
Colonel Carlos Castillo Armas in 1957.
1961 – Junior military officers involved
in a failed coup attempt encouraged by
Cubans to become the nucleus of
forces involved in armed insurrection
against the government. Fighting
continued for the next 36 years.
Three leading guerrilla groups
combined to form the Guatemalan
National Revolutionary Unity (URNG) in
1982.
1966-1982 – A series of military or
military-dominated governments
followed. Most notable were:
1978-82 – General Romeo Lucas
Garcia expected a Sandinist-style
takeover.
Instead,
1982-83 – General Efrain Rios Montt
was invited by young officers to
participate in a three-member military
junta. They annulled the 1965
constitution, dissolved Congress,
suspended political parties and
cancelled the electoral law. He later
dismissed his junta colleagues and
assumed the de facto title of President.
1983 – General Rios Montt was
replaced by his Defence Minister
General Oscar Humberto Mejia
Victores, at bidding of young officers.
1985 - Guatemala returned to a
democracy after a new democratically
determined constitution was approved.
1985 – Vinicio Cerezo, a civilian
politician won the first election under
the new constitution. A government
priority was to bring an end to the
political violence and establish the rule
of law. The military returned to a
more traditional role of providing
internal security. Despite two failed
coup attempts by dissatisfied military
personnel in1988-1989, Cerezo served
his elected term.
1991 – Jorge Serrano Elias of MAS
was inaugurated as President. Serrano
took the step of recognising
neighbouring Belize’s sovereignty,
with which it had a territorial dispute,
which is as yet still unresolved (see
below).
1993 – Serrano illegally dissolved
Congress and the Supreme Court in an
effort to stamp out alleged corruption.
His efforts to emulate Peruvian
autorcrat Fujimori encountered strong
protests from most of Guatemala’s
society. Serrano was forced to leave
the country by the military.
1993 - On 5 June Congress elected
Ramiro De Leon Carpio, Human Rights
Ombudsman to complete Serrano’s
Presidential term. De Leon called for a
referendum, which replaced the
Congress, shortened terms from 5 to
4 years and amended the Constitution
to bar central bank lending to the
government. Under De Leon the
government and the URNG signed
agreements on human rights (March
1994), resettlement of displaced
persons (June 1994), historial
clarification (June 1994), and
indigenous rights (March 1995).
1996 - Presidential and Congressional
elections in November 1995 resulted in
the inauguration of Alvaro Enrique
Arzu Irigoyen (PAN), the Foreign
Minister who recognised Belize, as
President. The Government of
President Alvaro Arzu (PAN) signed
peace accords with the guerrillas
(URNG) in 1996 and began their
implementation of the Peace Accords,
ending the 36-year civil war. It
pursued a policy of modernising the
government and economy, as well as
introducing social reform.
POLITICS
The FRG beat the PAN party at the last
Presidential and Congressional elections
in November/December 1999. They,
and all other parties, promised to
improve security, redistribute income,
revive a weak economy, implement
outstanding commitments under the
peace accords and to address
long-standing problems of corruption
and violence. As no Presidential
candidate won an absolute majority, a
second round of the Presidential
election was held on 26 December.
Alfonso Portillo Cabrera won 68% of
the vote and the FRG became the
majority in Congress with 63 out of 113
legislative seats. The National
Advancement Party (PAN) won 37, the
New National Alliance (ANN) 9 and
three minority parties won the
remaining four. 40% of the electorate
turned out to vote. The EU election
observation mission considered the
elections were well conducted,
transparent, free and fair, as they
have been since 1984 when the
constitutional assembly was elected.
President Portillo was inaugurated on
14 January 2000. The FRG is a party,
founded and led by former General
Efrain Rios Montt. He presently
presides over the Congress but is
constitutionally barred from standing
for President of the country because
he previously came to power through a
coup in 1982.
The next Congressional and
Presidential elections are due in
November 2003.
The 1996 Peace Accords followed 36
years of civil war and set forth
various sectoral accords covering a
wide range of topics, from the role of
indigenous people to the desired annual
rate of growth of the Guatemalan
economy in the next few years. The
Inter-American Development Bank
drew up a Peace Programme for
1997-2000 for the implementation of
the Peace Accords costing US$2.8bn.
The EU contributed 200 meuros
(US$260million). There was good
progress at first, especially on
demobilising the guerrillas, reducing
the size of the army, the return of
refugees and setting up a new national
civil police force. The pace of
implementation has however slowed
over the last two years and the
timetable for implementation has had to
be extended by two years to 2004.
The Peace Accords require Guatemala
to raise fiscal revenue to 12% of GDP
to meet the Accords’ requirements.
In order to generate revenue Congress
approved a tax package in July 2001
that included an increase in VAT from
10% to 12% from 1 August 2001, reform
of the tax code and stronger tax
collection mechanisms. This was
despite fierce opposition from all
sectors, including the private sector’s
umbrella organisation, CACIF
(Coordinating Committee of
Agricultural, Commercial, Industrial and
Financial Associations) who have called
for more transparency and
accountability in Government spending.
Civil society has argued that the
increases penalise the poorest in
society.
Congress has implemented new
legislation to increase taxes on alcohol
and tobacco and a ‘Standby
Agreement’ negotiated with the IMF
has helped to stabilise state finances.
THE ECONOMY (Foreign Office UK)
GDP: US$ 18-19 billion per year
GDP per head: US$ 1,500 per annum
(2000)
Annual Growth: 1.5% (2001)
Inflation: 7.6% (2001)
Major Industries: Agriculture accounted
for 23% of GDP in 2000, exports
principally coffee, sugar, bananas
provide half the national income. Close
to 20% of the population live on
subsistence farming. Nearly 10% of the
population are urban indigent.
Together these 30% are very poor.
Coffee accounts for a third of exports
with bananas and sugar supplying a
further 15%. There is nevertheless a
well-developed industrial sector
specialising in the production of textiles
and light manufactured items.
Major trading partners: USA, El
Salvador, Costa Rica, EU.
Aid & development: Mainly from USA,
EU and Japan and provides 25% of
state expenditure which is 13% of GDP.
Exchange rate: Approx Q10 to £1.
According to the Inter-American
Development Bank (IADB) Guatemalas
economic growth rate reached an
annual average of 4% from 1995-97
and inflation was reduced to a single
digit, the combined public sector deficit
was kept below 1% of GDP,
international reserves increased by
almost half, exports grew by more
than 50% and the deficit in the external
current account balance stabilised at
around 3.5% of GDP. Taxation
remained low at 8.8% of GDP in 1997.
The macro-economic framework
started to deteriorate however in
1998-99 due to a significant increase in
public spending not only in areas
covered by the Peace Accords but also
in other sectors.
The new administration took office in
January 2000 announcing it would
restore macro-economic stability as a
government priority. They also
announced that they would reverse the
US$700 million privatisation of
Telecoms. In its first quarter
Congress approved a 10% reduction in
public expenditure. A Fiscal Pact was
signed in May 2000 setting an ambitious
agenda for tax reform, spending
targets, fiscal balance, fiscal
administration, debt management, and
the monitoring and auditing of fiscal
procedures. It was immediately
declared ‘non-binding’ by the Vice
President. Congress said it would
disregard it as it impinged on their
legislative prerogatives. International
reserves increased, with payments
from privatisation, the exchange rate
stabilised and short-term market
interest rates became less volatile.
However, only part of the fiscal
measures agreed under the Peace
Accords (specifying how GDP would be
increased to 12% of GDP signed in June
2000) was implemented. (See
‘Politics and Elections’, fifth and
sixth paragraphs, above) was
implemented. Private investment
stalled and the drop in coffee prices,
rise in oil prices, the slow-down in the
main export markets and increased
public spending of 50% during the first
four months of 2001, caused the
economy to deteriorate.
As a result the Congressional session,
boycotted by the PAN, introduced a
package of new tax measures in July
2001 including an increase in VAT, but
the finance sector remained shaky as
the monetary authorities decided to
intervene in three insolvent banks, two
of which had sequestered US$60 m.
into deposits, halting the housing
programme. The second half of 2001
saw a further downturn with the
drought in Central America in July and
August and the September 11 terrorist
attacks in the USA. There was a drop
in Guatemala’s main exports and in the
substantial number of remittances
from relatives in the USA, resulting in
a loss of $50-100 million for the rest
of 2001. Further information can be
found on the IADB's website.
INTERNATIONAL RELATIONS
Guatemala's Relations with its
Neighbours
When Guatemala became independent in
1821, it claimed it had inherited the
previous Spanish administration of
British presence in Belize. Britain
negotiated its establishment of a colony
there with Guatemala. Britain
announced plans for Belize’s
independence in 1963 and as a result
Guatemala broke off full diplomatic
relations, but consular relations
continued. Belize became
self-governing in 1964. In September
1981, Belize gained its independence, but
this was not recognised by Guatemala.
Independence was preceded by
Guatemala ending consular relations
with Britain earlier in September 1981.
Guatemala also closed its
Consulate-General in Belize City and
Consulate in Benque Viejo del Carmen,
Belize. Subsequently, HM’s Consul left
Guatemala. From 1975 successive UN
resolutions endorsed Belize’s right to
self-determination, independence and
territorial integrity. As relations
improved Guatemala recognised Belize
as a sovereign and independent state in
September 1991, though maintaining a
territorial claim on Belize.
Guatemalan/UK diplomatic relations
were resumed in December 1986, while
consular relations were renewed in
August of the same year.
Belize and Guatemala have had a series
of meetings under the auspices of the
Organisation of American States (OAS)
in an attempt to resolve the dispute
through peaceful negotiation. Two
Facilitators, one each appointed by
Belize and Guatemala, presented
comprehensive recommendations to
both countries on 16 September 2002
on settling the dispute. The
recommendations were made public on
17 September. They recommend some
adjustment to the land border and new
maritime limits giving Guatemala an
Economic Exclusion Zone of some 2000
square nautical miles. The
Governments of Belize and Honduras
have each agreed to contribute 1000
square nautical miles to this zone. The
Facilitators also recommend the
establishment of a tri-national
ecological park covering coastal,
insular and maritime areas of Belize,
Guatemala and Honduras and a
substantial internationally financed
Development Trust Fund.
Dr Denis MacShane, FCO
Parliamentary UnderSecretary of
State, attended an OAS ceremony on
30 September in Washington marking
the end of the facilitation process.
Colin Powell, US Secretary of State
and other representatives of the
international community were also
present.
Although the Belize government publicly
supported the recommendations, the
Guatemalan government felt it could
not. The OAS-sponsored process
formally ended on 30 September 2002.
Since then the Governments of Belize
and Guatemala have been working with
the OAS to secure an agreement to
extend the CBMs as well as a process
for maintaining the OAS Facilitators’
recommendations. Both Governments
signed an agreement at the OAS
Headquarters in Washington on 7
February 2003 covering these two
issues.
Guatemala's relations with the
International Community
Peace Accords
Delegates from 19 donor countries and
17 international agencies attended the
last meeting of the Consultative Group
in May 2003. The government’s
progress against a nine-point plan was
reviewed covering areas such as
combating corruption, promoting
transparency and accountability, the
rule of law, human rights and citizen
security, indigenous rights, and
demilitarisation. Many donors noted
the Guatemalan government's slowness
in implementing the Peace Accords and
called on the government to increase
their efforts. Donors had promised
support through technical and financial
assistance programmes totalling
approx. US$1.3 billion, subject to
further progress being made in the
implementing of the Peace Accords at
the 2002 meeting.
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