Foreign policy and defense
Guatemala is a nation in North America. Its capital city is Guatemala City. Guatemala’s foreign policy is characterized by its proximity to the United States, which has historically had a great influence on the development of the country and is its most important trading partner. Relations with other countries in Central America are also important and Guatemala has been driving to increase political and economic cooperation in the region. The relationship with Belize, on the other hand, is strained, as Guatemala claims parts of the neighboring country.
The United States has long considered Central America as its “backyard”. The 1954 coup is the most tangible example of Washington’s involvement, but the United States was a close ally even when the worst abuses were committed against civilians in the early 1980s. When the US government’s support for the military regimes in Central America waned, it helped to secure the Guatemalan peace treaty in 1996, and President Bill Clinton later apologized for US involvement. The United States has pledged hundreds of millions of dollars in aid to Guatemala after the war, although disbursements have sometimes been delayed due to drug trafficking, economic crime and suspicions of human rights abuses by security forces. However, in the spring of 2019, the United States stopped all aid to Guatemala and El Salvador and Honduras, due to the migrant flow to the United States (see Calendar).
- Countryaah: Overview of business holidays and various national observances in Guatemala for years of 2020, 2021, 2022, 2023, 2024 and 2025.
The tone has hardened in Washington after Donald Trump took office in 2017. Under former President Barack Obama, in 2014, an Alliance for Prosperity with Guatemala as well as El Salvador and Honduras was formed. The United States pledged a total of $ 750 million to the three countries of the “Northern Triangle” which is the most violent region in the world where there is no war. The idea was that the money would be used to improve security and reduce poverty in the three countries, thus counteracting the widespread influx of migrants illegally applying to the United States. The alliance was then formed a sharp increase noted by the number of Central Americans, and not least minors, who were trying to make their way to the United States. However, the desired effect has not been achieved, in 2019 the number of migrants applying from the three countries to the United States has again increased significantly.
In the summer of 2019, an agreement was signed with the United States, which means that migrants, primarily Hondurans and Salvadorans, who are trying to cross Guatemala to reach the United States should seek asylum in Guatemala first (see Calendar). If they still reach the United States, the US authorities, with the settlement, have the right to send them back to Guatemala, which will receive the status of “safe third country”. However, the agreement has been met with harsh criticism and it is questioned whether it is compatible with the country’s constitution.
Regional cooperation
Cooperation between the Central American countries is essential. Guatemala played an important role in the work on the regional peace plan launched in 1987 and in the founding of the Central American Parliament (Parlacén) that year. Economic coordination was initiated in the region in the 1950s and Guatemala has on several occasions entered into agreements on a common market with several neighboring countries. The disputed DR-Cafta FTA entered into force in 2006 between Guatemala, Costa Rica, El Salvador, Nicaragua, Honduras, Dominican Republic and the United States. The agreement meant that bilateral trade between Guatemala and the US more than doubled in a few years, but it was mostly imports from the US that increased. Guatemalan exports to the US increased significantly to a greater extent, most of which was Guatemalan textiles, shoes and food that benefited from the agreement.
Guatemala also entered into a free trade agreement with Taiwan in 2006. Like many of its neighboring countries, Guatemala has long maintained diplomatic relations with Taiwan instead of China. Despite this, Guatemala receives about a tenth of its imports from China.
Trade with the EU
After several years of negotiations, an EU-Central America Association Agreement became effective in 2013. For Guatemalan, the agreement entered into force on December 1, 2013. The comprehensive agreement includes free trade, development cooperation and political dialogue. The free trade section means that the Central American countries have free access to the EU market for 90 percent of their export products. However, in the case of important goods such as bananas, tariff rates are gradually reduced or, as for sugar and beef, gradually increased export quotas. The agreement also covers trade in services such as telecommunications and financial services, and the agreement also entails common rules on intellectual property rights.
Mexico
In September 2013, several Central American countries signed a free trade agreement with Mexico. The Puebla-Panama integration project already covers roads, electricity and other infrastructure, as well as industrial and tourism cooperation from Mexico’s southern states in the north to Panama in the south. The project has been widely criticized for favoring multinational companies rather than the people and the environment in the region. Guatemala and three other Central American countries have been discussing a free trade agreement with Canada since 2001, but so far only Honduras has entered into its own agreement with Canada.
Tight relations with Belize
The relationship with Belize is complicated. Belize became independent from the United Kingdom in 1981 but only ten years later did Guatemala recognize the neighboring country. Guatemala still claims half of Belize’s territory, and despite international mediation efforts, no settlement has been reached. In 2008, the countries agreed to hand over the case to the International Court of Justice (ICJ) in The Hague, but only after the peoples of both countries said their case. Referendums were to be held in 2013, the same day in both countries, but Guatemala backed out. Only in April 2018 did the referendum in Guatemala take place and 96 percent of the voters who participated said yes to allowing the ICJ to resolve the dispute. When the referendum was held in Belize in May 2019, 55 percent of Belizean voters voted for it.
In 2016, tension in the border region increased after a Guatemalan teenager was shot dead by the Belizean military. Guatemala sent 3,000 soldiers to the area (see also Calendar).
In half a year 2013, Guatemala joined the Venezuelan-led oil partnership Petrocaribe, which means that member states may buy Venezuelan oil at discounted prices or in exchange for goods and services. Guatemala became a member of the alliance in May, but left it in November because it did not receive the favorable terms the government hoped for.
Defense
Guatemala’s defense is based on selective military duty for 30 months. Military forces have been sharply cut since the 1990s. However, there are large reserve forces and paramilitary forces. According to the peace agreement, the military is only to be deployed against external threats, but despite this, the army has to some extent been used in the fight against violent crime.
FACTS – DEFENSE
Army: 15,500 men (2017)
The air Force: 1,000 men (2017)
The fleet: 1,500 men (2017)
Military expenditure’s share of GDP: 0.4 percent (2017)
Military spending’s share of the state budget: 3.0 percent (2017)