Guatemala has solidified its position as a key destination for FDI in Latin America. In 2024, the country achieved a foreign direct investment (FDI) volume of USD 1.65 billion and aims to sustain and increase these inflows in 2025. This strengthens its image as an attractive destination for international investment and allows it to capitalize on new opportunities in the global market. The government has been actively enhancing the business environment, ensuring investors find favorable conditions for expansion and growth.
Strategic Sectors and Growth Opportunities
Guatemala has demonstrated a remarkable ability to attract investment in key sectors such as manufacturing, information technology, and tourism. These sectors span a wide geographical area within the country and have been fundamental pillars of its economic growth. As global supply chains continue evolving, Guatemala’s strategic location in Central America offers an advantage for companies seeking to optimize logistics and reduce costs.
The Minister of Economy, Gabriela García, has highlighted the vitality and dynamism of these sectors, pointing out that manufacturing industries, hospitality and food services, and information technology continue to be areas with significant expansion potential. Guatemala’s ability to attract FDI in Latin America is primarily due to its macroeconomic stability and improvements in the business climate. The country’s young and growing workforce also provides a strong labor market for investors looking to scale operations.
Beyond traditional industries, emerging sectors such as renewable energy and financial technology (fintech) are also gaining traction. The government has introduced new policies encouraging investment in sustainable energy projects, promoting solar, wind, and hydroelectric power use. Fintech startups, driven by increased digitalization and financial inclusion initiatives, are also attracting interest from investors looking for high-growth opportunities.
Major Investors and Key Markets
Guatemala’s most significant sources of investment remain Central America, Mexico, and the United States. However, Panama’s growing interest in investing in the country is a noteworthy trend. “These monitored investment flows demonstrate the increasing relationship with traditional and emerging markets,” stated Minister García.
Additionally, the tourism and hospitality sector has received special attention as one of the areas with the most significant growth potential. The government aims to boost investment in hospitality and service activities to foster tourism, generate employment, and enhance local development. With its rich cultural heritage, diverse landscapes, and growing ecotourism industry, Guatemala presents an attractive destination for international hotel chains and tour operators.
Foreign investors are also increasing their presence in the banking and financial services. Guatemala’s stable banking regulations and improving financial infrastructure make it an attractive hub for regional financial operations. Investments in digital banking services and mobile payment solutions are expected to rise as the country modernizes its financial systems.
Strategies to Increase Foreign Direct Investment in 2025
In 2025, Guatemala aims to strengthen and diversify its strategies to attract larger foreign investments. One key initiative is the creation of ProGuatemala, an agency that will centralize government efforts to attract and manage foreign investment.
“With the launch of ProGuatemala, we are institutionalizing our efforts to attract and manage investments more effectively,” García explained. This agency will be crucial in improving investment intelligence, supporting businesses already established in the country, and ensuring the expansion of existing investments. ProGuatemala aims to position the country as a top choice for international companies by streamlining investment processes and providing investors with tailored support.
Guatemala also plans to intensify its presence at international events, enhancing its global perception and allowing it to adjust strategies according to market dynamics. This includes investment missions and participation in key economic forums to remain on the radar of the world’s top investors. Strengthening trade agreements with regional and global partners will also be a focal point in ensuring a more seamless investment environment.
Persistent Challenges
Despite progress, Guatemala faces significant challenges that could limit its potential as a recipient of FDI in Latin America. Some of the main obstacles include:
- Deficient Infrastructure: The lack of modernization in roads, ports, and energy systems affects the country’s competitiveness. “Improving our infrastructure is essential to facilitating trade and attracting more significant investments,” emphasized Minister García. To address these issues, large-scale infrastructure projects, such as the expansion of highways and modernization of airport facilities, are in the pipeline.
- Security Issues: Risk perception regarding security affects investors’ decision-making. According to the World Justice Project, Guatemala ranked 107th out of 142 in the Rule of Law Index in 2024. Additionally, the rising costs associated with security pose an extra barrier to attracting investors. The government has introduced initiatives to improve law enforcement and increase public safety, enhancing investor confidence.
- Composition of Foreign Direct Investment: While investment figures are encouraging, experts warn that a significant portion of the recorded amounts come from reinvesting profits by already established foreign companies or acquiring existing businesses rather than new investments. Encouraging greenfield investments involving new projects and job creation remains challenging.
Projections and Expectations for 2025
The Bank of Guatemala (BANGUAT) estimates that foreign direct investment will reach USD 1.815 billion in 2025, representing a 10% increase over the previous year. However, surpassing this figure will depend on the country overcoming the abovementioned challenges.
Although modest, the country’s economic growth relies heavily on domestic consumption. Strengthening both local and foreign investment is essential to ensure sustained development. Increased workforce training and education efforts will ensure that Guatemala’s labor market remains competitive and attractive to international businesses.
Conclusion
Guatemala continues establishing itself as an attractive destination for FDI in Latin America. Its macroeconomic stability, strategic location, and young population position it as an emerging market with great potential. However, to maximize investment opportunities, the government and the private sector must collaborate on infrastructure modernization, strengthening the rule of law, and creating competitive incentives for new investors.
If Guatemala successfully addresses these challenges, it can attract investments in key sectors such as processed foods, non-alcoholic beverages, chemicals, pharmaceuticals, textiles, software, contact centers, and BPOs. The future of foreign direct investment in Guatemala is promising. Still, its sustained growth will depend on the strategies implemented to improve the business environment and strengthen its appeal as an international investment destination.