THE BRIDGE TO SUCCESS IN GUATEMALA

Any international company wishing to thrive in the market can benefit from working with a Guatemala PR agency that understands the unique cultural idiosyncrasies of the country, but also has an international perspective.

Whether you are a consumer brand, business services provider or a disruptive tech start-up, Sherlock Communications is a unique among PR agencies in Guatemala in offering an award-winning team that combines local insight and media contacts, besides decades of international experience.

Whether it’s media relations, social and digital media, influencer campaigns, performance marketing or inbound lead generation, Sherlock’s Guatemalan team has a proven track record of delivering great results for international clients, from disruptive tech companies to blue-chip brands.

Guatemala is the largest economy in Central America, with a recorded GDP of USD 75.7 billion in 2017 and an average growth rate of 3.6%, predicted to continue to 2023 according to IMF estimates, making it one of the most stable in the Latin America region.

It is also the most populous country with a population of 16.9m inhabitants and GDP per capita of USD 4,472. One of its main advantages is geographical access to Mexico and, via the North American Free Trade Agreement (NAFTA), trading access to the US and Canada. In the long term, Guatemala has the potential to be a major hub of supply chain companies, particularly due to the help of the recently launched customs union between Guatemala and Honduras.

Agriculture predominates, accounting for 23% of GDP and 75% of all exports and Guatemala is reliant on traditional exports such as coffee. Manufacturing is centred on light assembly and food processing whereas tourism and the export of textiles, along with non-traditional agricultural products such as fruit and cut flowers are increasingly important.

Guatemala has four major newspapers: Prensa Libre, El Periódico, Siglo XXI, which are all morning publications—and La Hora, an afternoon paper. Also published is one minor daily tabloid, the more sensational Nuestro Diario, as well as two weekly publications, Critica and Crónica. All except Crónica are independent.

The major independent newspapers regularly criticise the government as well as the military and other powerful segments of Guatemalan society. They have been able to publish reports on alleged government corruption and/or drug trafficking, using sources such as human rights groups, clandestine intelligence or left-leaning organisations like the news agency CERIGUA, or the Centro para la Defensa de la Libertad de Expresión (Center for the Defense of Freedom of Speech).

Both Critica and Crónica were historically equally independent, but Crónica became the target of an advertising boycott in 1998 and was forced to sell to a conservative owner. By 2002, it was reflecting the new owner’s right-wing philosophy, while Critica continued to be critical of the government.

Additionally, there is the English-language daily The Guatemalan Post, as well as the oldest surviving newspaper in Central America, the Diario de Centro America. However, in the first decade of the twenty-first century, Diario de Centro America was a semi-official paper that reported legal news only and has lacked the readership of many other papers.

Foreign news agencies active in Guatemala include Reuters and the Associated Press, as well as agencies from Spain, Germany, France, Mexico, the United States and Canada.

There are 26 TV stations, with the content deriving from one of four major outlets: Canal 3, Canal 7Televisiete, Canal 11, and Canal 13. All are located in Guatemala City, from where all media—print and electronic— originates. The government also owns other channels, Canal 21 and for the military, Canal 5. Radio broadcasters number approximately 600 stations.

Guatemala has 7.2 million internet users, approximately 42% of the population. Among these, 6,8 million use Facebook, mostly accessing via smartphones. The country has 18. Million mobile subscriptions.

Guatemala has the largest population of any Central American country with a GDP per capita roughly one-third of Brazil’s. According to World Bank data, Guatemala’s economy grew by 2.9% in 2016, 4.1% in 2015 and 4.2% in 2014. GDP growth for 2017 was approximately 3.2%. Despite the constant growth of the economy, inequality does remain a challenge, with 59.3% of the its people living in poverty, as recorded in 2014. The unemployment rate was 2.6% in 2017, however, informal economic activity accounts for at least 70% of the workforce, meaning less than 30% of workers are fully covered by social security regulations.

There is also a low minimum wage of USD 400 per month, not enough to cover basic consumer goods which are valued at USD 500 and inflationary pressures are likely to increase in with food and oil prices rising. Inflation increased to 37% in 2016.

Export-wise, Guatemala has shifted from being a raw materials and traditional agriculture commodities exporter, including sugar, coffee, beef products, cardamom and bananas at 25% of exports, to become one of the most diversified exporters in Latin America. Non-traditional products such as textiles/apparel and light manufacturing are now sent to more than 140 countries globally. Total exports in 2017 were USD 11bn.

Going forward, the Guatemalan government aims to expand its energy and extractive sectors, which currently are relatively undeveloped. According to further data from the World Bank, the flow of foreign direct investment (FDI) in 2015 was USD 1.18bn, a slight increase on the USD 1.17bn received in 2014. The Guatemalan Central Bank (Banguat) forecasted FDI to reach around USD 1.19bn in 2016.

The government is also implementing tools to more easily enable doing business in the country, including reducing time and therefore costs to set up a business, introducing online systems to open them, facilitating credit and working on regional integration, among others. Overall, the country’s level of imports of goods and services has continued to increase.

By 2017, the direct contribution of Travel & Tourism to GDP was USD: 2,208.8mn, 2.9% of the country’s and this is forecast to rise by 4.5% in 2018, further to by 4.0% pa to USD9,325.6mn, – 8.6% of GDP – in 2028. In 2017, the Travel & Tourism industry directly supported 166,000 jobs, 2.6% of total employment and this is also expected to rise by 4.5% in 2018, to 3.3% per annum and create 239,000 jobs – 2.7% of total employment – in 2028. Visitor exports generated USD 1,576.6m, which accounts for 9.5% of total exports in 2017, whereas investment in the sector in 2017 was USD 830.9m. This is expected to rise by 1.9% in 2018 and by 4.4% pa over the next ten years to USD1,302.2mn in 2028 – a rise by 9.1%.

Tourism has therefore become one of the main drivers of the economy and is growing. Guatemala receives about two million tourists every year and is visited by cruise ships from all over the world.