Compare the differences in the US foreign policy to Guatemala between the Bush II and Trump administrations.

Current Politics and Economics of … ISSN: 1935-2549

Volume 12, Issue 2 © 2019 Nova Science Publishers, Inc.

GUATEMALA: POLITICAL

AND SOCIOECONOMIC CONDITIONS

AND U.S. RELATIONS

Maureen Taft-Morales

ABSTRACT

Guatemala, the most populous Central American country, with a

population of 16.3 million, has been consolidating its transition to

democracy since the 1980s. Guatemala has a long history of internal

conflict, including a 36-year civil war (1960-1996) during which the

Guatemalan military held power and over 200,000 people were killed or

disappeared. A democratic constitution was adopted in 1985, and a

democratically elected government was inaugurated in 1986.

President Jimmy Morales, a political newcomer, took office in

January 2016, having campaigned on an anti-corruption platform. The

previous president and vice president had resigned and been arrested after

being implicated in a large-scale corruption scandal. Morales is being

investigated for corruption and has survived two efforts to remove his

immunity from prosecution.

In what many observers see as a step forward in Guatemala’s

democratic development, the Public Ministry’s recent corruption and

human rights abuse investigations have led to the arrest and trial of high-

level government, judicial, and military officials. The Public Ministry is

responsible for public prosecution and law enforcement, and works in

conjunction with the United Nations-backed International Commission

 This is an edited, reformatted and augmented version of Congressional Research Service

Publication No. R42580, Updated March 27, 2018.

Maureen Taft-Morales 174

against Impunity in Guatemala (CICIG) to strengthen rule of law in

Guatemala. As their anti-corruption efforts prove effective, the circle of

those feeling threatened by investigations broadens, and attacks against

CICIG and the judicial system it supports broaden and intensify as well.

Since Morales and some of his inner circle became the targets of

investigations, he has tried to weaken CICIG and fired some of his more

reformist officials. Observers within Guatemala and abroad worry that

Morales is trying to protect himself and others from corruption charges.

Guatemala continues to face many other challenges, including

insecurity, high rates of violence, and increasing rates of poverty and

malnourishment. Guatemala remains a major transit country for cocaine

and heroin trafficked from South America to the United States. Although

Guatemala recorded record drug seizures in 2016, the lack of law

enforcement and the collusion between corrupt officials and organized

crime in many areas enable trafficking of illicit drugs, precursor

chemicals, weapons, people, and other contraband. During Morales’s first

year, his administration improved tax collection, and the interior ministry

reported a 5% drop in homicide rates.

Guatemala has the largest economy in Central America and in recent

decades has had relatively stable economic growth. Despite that

economic growth, Guatemala’s economic inequality and poverty have

increased, especially among the rural indigenous population. The

Economist Intelligence Unit projects that the country’s economic growth

rate will likely peak in 2018-2019 at 3.2%, followed by a decrease until

2022. The World Bank calls for rapid economic growth coupled with

increased public investment and pro-poor policies to improve social

conditions.

Traditionally, the United States and Guatemala have had close

relations, with friction at times over human rights and civil/military

issues. Guatemala and the United States have significant trade and are

part of the U.S.-Central America-Dominican Republic Free Trade

Agreement (CAFTA-DR). Top priorities for U.S. bilateral assistance to

Guatemala include improving security, governance, and justice for

citizens; improving economic growth and food security; providing

access to health services; promoting better educational outcomes;

providing opportunities for out-of-school youth to reduce their desire to

migrate. The U.S. Strategy for Engagement in Central America is meant

to spur development and reduce illegal emigration to the United States.

The Trump Administration’s proposed FY2018 budget request would

have cut funds for Guatemala by 36% and eliminated traditional food aid

and the Inter-American Foundation. Congress rejected much of those

cuts in the reports to and language in the Consolidated Appropriations

Act, 2018 (P.L. 115-141).

Guatemala 175

POLITICAL CONDITIONS

President Jimmy Morales, a relative political newcomer, won Guatemala’s

2015 presidential election by a landslide with 67% of the vote. During the

campaign, as mass protests calling for then-President Pérez Molina’s

resignation and an end to corruption and impunity grew, so did Morales’s

popular appeal.

Guatemala at a Glance

People:

Population: 16.58 million (2016, World Bank) Life expectancy: men, 71 years;

women, 75 years

Ethnic groups: Mixed and European (60.1%); Indigenous Maya (39.3%); other (0.6%)

Literacy: men, 87.4%; women, 76.3% Poverty: 59.3% (2014)

Economy

GDP: $68.763 billion (2016) GNI per capita: $3,790 (2016)

GDP composition by sector: agriculture, 13.2%; industry, 23.5%; services, 63.3%

(2016 estimates)

Trade

Key export partners: United States (33%), El Salvador (11.53%), Honduras (8.75%)

Top exports to the United States (2016): edible fruit and nuts, citrus fruit, or melon

peel; apparel articles and accessories; sugars and sugar confectionary

Leadership

President Jimmy Morales (the president is both chief of state and head of government)

Morales framed his lack of political experience as an asset. His campaign

slogan was “Neither corrupt nor a thief,” and he ran on a platform of

governing transparently and continuing to root out corruption. He is now being

investigated for corruption himself.

Guatemala faces many political and social challenges in addition to

widespread corruption and impunity. Guatemala has some of the highest levels

of violence, inequality, and poverty in the region, as well as the largest

population. Indigenous people, about half of the population, experience higher

rates of economic and social marginalization than nonindigenous citizens, and

have for decades. Almost half of the country’s children are chronically

malnourished.

Maureen Taft-Morales 176

Source: Graphic created by CRS using data from the Department of State (2015) and

Global Administrative Areas (2017).

Figure 1. Guatemala at a Glance.

Guatemala’s homicide rate decreased to 26.1 per 100,000 in 2017, which

nonetheless remains one of the highest rates in the region.1 Guatemala has a

long history of internal conflict and violence, including a 36-year civil war

(1960-1996). For most of that time, the Guatemalan military held power and

violently repressed and violated the human rights of its citizens, especially its

majority indigenous population. Reports estimate that more than 200,000

people were killed or disappeared during the conflict, with the state bearing

responsibility for 93% of human rights violations. More than 83% of the

victims were identified as Mayan.2 In 1986, Guatemala established a civilian

democratic government, but military repression and human rights violations

1 “Homicidios bajan a 12.16 por ciento,” Diario de Centro América, February 7, 2018. 2 Christian Tomuschat, Otilia Lux de Coti, and Alfredo Balsells Tojo, Guatemala: Memory of

Silence, Commission for Historical Clarification,1999, pp. 17, 20.

Guatemala 177

continued. Peace accords signed in 1996 ended the conflict. The United States

maintained close relations with most Guatemalan governments, including the

military governments, before, during, and after the civil war.

Since the late 1980s, Guatemala has sought to consolidate its transition

from military and autocratic rule to a democracy. Democratically elected

civilian governments have governed for over 30 years, but democratic

institutions remain fragile due to high levels of corruption, impunity, drug

trafficking, and inequitable distribution of resources. Although state

institutions have investigated and arrested high-level officials, including a

sitting president, for corruption, high levels of impunity in many cases

continue due to intimidation of judicial officials, deliberate delays in judicial

proceedings, and widespread corruption.

The Supreme Electoral Tribunal (TSE) investigated multiple political

parties for violations of election campaign finance laws in 2014 and 2015, as

part of its auditing process. As a result, the TSE dissolved two major parties,

the Partido Patriota—former President Pérez Molina’s party— and LIDER.

President Morales presented his General Government Policy for 2016-

2020 in February 2016. The five pillars of this plan are zero tolerance for

corruption, and modernization of the state; improvement in food security and

nutrition; improvement in overall health and quality education; promotion of

micro, small, and medium enterprises, and tourism and housing construction;

and protection of the environment and natural resources.

Halfway into his four-year term, however, Morales is being investigated

for corruption and criticized for seemingly backing off his pledge of zero

tolerance for corruption. In 2017, two members of the president’s family were

arrested on corruption charges. In August and September 2017, Guatemala’s

attorney general and a United Nations (U.N.) anti-impunity commission

announced they were seeking to lift the president’s immunity from prosecution

as they investigate alleged violations of campaign finance laws and bonuses

paid to him by the military. The president tried unsuccessfully to expel the

head of the U.N.-backed International Commission against Impunity in

Guatemala (CICIG), Commissioner Ivan Velásquez, and has since argued that

the commission is no longer needed. (See “Efforts to Combat Impunity and

Corruption,” below.)

A recent opinion poll found that more than 72% of the population has

little or no trust in the police, and about 65% has little to no trust in the

Maureen Taft-Morales 178

government3 Conversely, 83% of the population said they supported CICIG

and the Public Ministry—which is headed by the attorney general— making

them Guatemala’s most trusted institutions.

So far, the judicial process, protests, and mass mobilizations in the wake

of high-level government corruption scandals have remained peaceful.

Nonetheless, tensions have heightened since President Morales tried to expel

CICIG’s commissioner, and the Guatemalan Congress tried to reduce criminal

penalties for campaign-related corruption. Renewed public protests called for

the resignations of President Morales and members of Congress seen as

protecting corrupt practices. (See “Current Political Tensions,” below.)

While some see the corruption charges as a crisis, others—including many

within the Guatemalan government—see an opportunity to make the

government more honest and accountable. Nonetheless, continued impunity

coupled with the state’s failure to provide basic public services to large parts of

the population and limited advances in reducing Guatemala’s high poverty

levels could prolong protests. Military-criminal enterprises and other powerful

interests that have benefited from corruption and the status quo have fought

against anti-corruption and anti-impunity work since it began. They have

threatened public prosecutors, the attorney general, and members of the

judiciary. Continued prosecution of corruption could provoke increasingly

violent responses from those whose wealth or power are threatened. Powerful

interests also use more subtle methods to try to weaken CICIG, the Public

Ministry, and groups pushing for political reform. These include tactics such as

discrediting the reputations of officials, activists, and their organizations; delays

or cuts in the judicial system’s budget; spurious legal actions that delay trials

and drain fiscal and human resources; and attempts to change CICIG’s mandate

or terms.

President Jimmy Morales’s Administration

President Morales’s administration achieved a few significant reforms in

the first year and a half. For example, the administration developed tax reform

3 Martín Rodríguez Pellecer, “Encuesta: Pro MP-CICIG y Democracia, y no por Gobierno, Cacif

y Ejército,” Nómada, March 27, 2017.

Guatemala 179

policies covering tax collection, the tax authority administration, and the

customs office structure. Since Morales and some of his inner circle became

the targets of investigations, however, he has tried to weaken CICIG and fired

some of his more reformist Cabinet ministers and other officials who worked

closely with CICIG and the attorney general’s office, replacing them with

closer allies. This has raised concerns both domestically and internationally

that Morales is trying to protect himself and others from corruption charges

and may be reversing reformist policies.

The tax administration (SAT), under the leadership of Juan Francisco

Solórzano for the first two years of the Morales administration, used judicial

measures and intervention to increase recovery of unpaid taxes and

substantially increased tax collection. Solórzano, a former head of the criminal

investigation unit at the attorney general’s office, had the endorsement of

CICIG as well as the Inter-American Development Bank, World Bank, and

International Monetary Fund.4 Under his leadership, the SAT collected $297

million in recovered taxes in 2016 compared to $5 million in 2015.5 Following

austerity measures in 2016 that limited government spending and decreased the

deficit, the Guatemalan Congress passed an expansionary budget for 2017.6

This was possible in part because of increased state revenues from improved

tax collection. Solórzano also played a key role in prominent anti-corruption

cases. President Morales fired Solórzano in January 2018.

President Jimmy Morales

Born in 1969 in Guatemala City, Guatemala, to a family of humble means, Morales

entered politics after making a name for himself as a TV comedian. When he lost the

mayoral race for Mixco in 2011, Morales joined his current party, the right-wing National

Convergence Front-Nation (FCN-Nación), in 2013 and became secretary general of the

party. In 2015, FCN-Nación nominated him as its presidential candidate; he drew on his

outsider status to distance himself from the historically corrupt political class.

Investigations by CICIG and the Public Ministry (MP) have implicated Morales’s

brother and son in a fraud case. The attorney general is seeking to have Morales’s

immunity from prosecution lifted so he can be investigated for possible campaign

finance violations and payments the military paid to him while president.

4 “Morales Fills a Key Post in Guatemala,” LatinNews, March 10, 2016. 5 Urias Gamarro, “Intervenciones de SAT Mejoraron Cobranza,” Prensa Libre, May 2, 2017. 6 Economist Intelligence Unit, “Country Report: Guatemala,” generated June 7, 2017, p. 2.

Maureen Taft-Morales 180

The interior ministry, which includes Guatemala’s National Civil Police

(PNC) force, oversaw a drop in the homicide rate from 27.3 homicides per

100,000 people in 2016 to 26.1 per 100,000 in 2017, the lowest rate in nine

years.7 In February 2018, the Morales administration dismissed the three

senior officials of the national police, saying it sought “to generate more

positive results to benefit citizen security and the fight against organized

crime.”8 A wide range of people, including human rights activists and business

leaders, expressed concern at their dismissal. The country’s Human Rights

Ombudsman, Jordán Rodas, said Guatemalans must be “very alert” to any

movement that represents “regression.”9 A prominent trade association known

by its acronym CACIF criticized the ouster, saying that outgoing police

Director Nery Ramos had reduced crime. The U.S. Embassy in Guatemala

congratulated Ramos just a few weeks before his dismissal for his team’s work

in reducing homicides by 10% compared to January 2017 and for the PNC’s

“fight against corruption and to improve security throughout Guatemala.”10

In response to the high level of violence over many years, a number of

municipalities asked for military troops to augment their ineffective police

forces; the Guatemalan government has been using a constitutional clause to

have the army “temporarily” support the police in combating crime. Despite

efforts to develop a comprehensive, whole-of-government approach to

security, the previous five administrations’ actions often have been reactive

and dependent on the military. The Morales administration announced a two-

phase plan to remove the military from citizen security operations by the end

of 2017. The new plan includes shuffling military currently involved in citizen

security efforts to the country’s borders to control land routes used by

traffickers and gangs.11 This would be a significant effort to comply with

provisions of the 1996 peace accord calling on the army to focus solely on

7 Carlos Hernández, “Monitoreo Final de PNC Reportó 258 Homicidios Menos en el País,”

Ministerio de Gobernación, January 1, 2017, and “Homicidios bajan a 12.16 por ciento,”

Diario de Centro América, February 7, 2018. 8 “Destituyen a los tres altos mandos policíacos en Guatemala,” Diario 24 Horas, February 28,

2018. 9 Héctor Silva Ávalos, Felipe Puerta, and Kelly Grant, “Ousting of Police Director May Shift

Guatemala’s Balance of Power,” InSight Crime, March 2, 2018. 10 “Ambassador Arreaga supports the efforts of the National Civil Police,” U.S. Embassy in

Guatemala, January 31, 2018. 11 Lorena Baires, “Guatemala Reforzará Sus Fronteras para Cortar Rutas de Narcotráfico,”

Diálogo, April 4, 2017.

Guatemala 181

external threats. The interior minister who initiated the plan, Francisco Rivas,

was fired by the president in January 2018. Morales said that the plan would

continue, however, and military troops would be withdrawn from the streets

by March 31, 2018.12 Morales’s new interior minister, Degenhart Asturias, has

indicated a shift in priorities away from fighting corruption to fighting gangs.

One of his first actions was to ask the Guatemalan Congress to designate

criminal gangs as “terrorist organizations.”13

Morales had already faced criticism for not acting forcefully enough on

his pledge to crack down on corruption, and for his links to family and friends

under investigation, before he tried to expel Commissioner Velásquez.

Attorney General Aldana has said she will resign if the president expels the

head of CICIG, with whom she has worked closely to prosecute high-level

corruption and human rights violation cases. Both Attorney General Thelma

Aldana and the commissioner of CICIG said that the president had not

interfered directly in corruption cases—even those involving his family. But

both also expressed disappointment that he had not spoken out in support of

them and their anti-corruption efforts when attacked by anti-reform elements.

They also voiced concern that Morales has publicly portrayed himself and his

family as victims of the judicial system, potentially biasing the judicial

process.

Initially, President Morales’s political power was limited as a result of his

own inexperience and his party’s weak position in the legislature. Morales’s

small party, the right-wing National Convergence Front-Nation (FCN-

Nación), won 11 of 158 seats in the legislature. The Guatemalan Congress

elected an opposition member to be president of the unicameral chamber. At

the beginning of Morales’s term, deputies defected from other parties, bringing

the FCNNación’s seat total to 37. People criticized Morales for allowing the

deputies to join his party just before the Congress outlawed the practice. The

public prosecutor received complaints alleging that bribery motivated some

defections to the FCN-Nación.14

12 José Meléndez, “Guatemala retira al ejército de las calles,” El Universal, March 8, 2018. 13 “Guatemala seeks to designate criminal gangs as ‘terrorists’,” Agence France Presse, January

29, 2018. 14 “Lack of Reforms Will Undermine Corruption Crackdown,” Business Monitor Online, March

1, 2016.

Maureen Taft-Morales 182

Morales has since formed an alliance able to pass legislation, however, and

consolidated his support in the Congress. In 2017, the legislature twice voted

against prosecutors’ requests to lift the president’s immunity for violations of

campaign finance laws and bonuses paid to him by the military, blocking

further investigations into the president’s role in the scandals. The Congress

tried to weaken anti-corruption laws with a measure to reduce penalties for

illegal campaign financing that the public dubbed the “Pact of the Corrupt.”

Public outcry was so strong that Congress repealed the law two days after

passing it. Nonetheless, the Congress elected a new leadership in February

2018, all of whom, according to the State Department, voted for that pact.

Morales has also come under fire for two contracts with an Indiana

lobbying firm that reportedly has ties to U.S. Vice President Mike Pence.15

The firm was hired to improve relations between the U.S. and Guatemalan

governments outside of normal diplomatic channels. Guatemalan politicians

without the authority to act in foreign affairs signed the contracts. Morales

denies knowing about the contract, though one was signed on his behalf, and

only he and the foreign ministry are authorized to intervene in foreign

affairs.16 Furthermore, observers criticize his reclusiveness with the press: he

has removed journalists’ access to the presidential palace, and rarely holds

press conferences.

Morales’s administration and the secretariat for Social Welfare came

under scrutiny after a fire killed 41 girls in a state-run home in March 2017.

The director of the shelter, the minister of Social Welfare, and his deputy were

dismissed after the fire. Recently, a judge charged the former minister, his

deputy, and five additional people (two police officers with abuse, and three

senior members of social and child protection agencies with manslaughter or

negligence).17

During the campaign, Morales was criticized for a short governing plan

with proposals such as tagging teachers with a GPS device to ensure they

attend classes and giving every Guatemalan child a smartphone in exchange

for advertising on school walls. U.S. embassy officials expressed concern that

15 Nina Lakhani, “Guatemala President Under Pressure over Lobbying Firm Linked to Mike

Pence,” The Guardian, June 23, 2017. 16 Nina Lakhani, “Guatemala President Under Pressure over Lobbying Firm Linked to Mike

Pence,” The Guardian, June 23, 2017. 17 “Guatemala: Officials and Police Charged over Girls Shelter Blaze,” BBC, June 25, 2017.

Guatemala 183

Morales’s campaign team refused to cooperate with certain elements of

Guatemalan civil society, particularly human rights advocates working on the

protection of children and trafficking victims, and LGBTI (lesbian, gay,

bisexual, transgender, intersex) issues.18

Links between Morales’s Party and the Military

Before the current controversy between Morales and CICIG, human rights

and other observers expressed concern that Morales’s party’s ties to former

military officers might put pressure on Morales’s support of CICIG, as well as

limit his government’s investigation of military corruption and human rights

violations. Before the new government was sworn in, Attorney General

Aldana requested legal action against retired army colonel Edgar Ovalle, a key

advisor to Morales and a legislator-elect with the FCN-Nación, for alleged

civil war-era (1960-1996) human rights violations. After declining the request

in 2016, Guatemala’s Supreme Court lifted Ovalle’s immunity in 2017.

Ovalle’s whereabouts have been unknown since March 2017.

Over a dozen other military officers have been arrested on similar charges.

Many of them support the FCN-Nación and belong to a military veterans’

association, Avemilgua, which Ovalle helped found. Avemilgua members

created the FCN-Nación in 2004, and testified in court in defense of former

dictator Efrain Rios Montt in 2013. Rios Montt, found guilty in 2013 of

committing genocide and crimes against humanity during the civil war, had his

conviction effectively vacated a short time later. On January 5, 2016, a judge

suspended a retrial, which began again in March. In 2017, a judge ordered Rios

Montt to stand trial in a different case for the massacre of 201 people between

1982 and 1983 in Dos Erres.19 Morales reportedly said he did not believe

genocide had been committed during the war, but that crimes against humanity

had.20

The Defense Ministry recently said that it has been paying President

Morales a substantial salary bonus since December 2016 (see “Current

Political Tensions” below). Two former presidents, Alfonso Portillo and

18 Communication between U.S. State Department officials and CRS Specialist. 19 Henry Estuardo Pocasangre and Jerson Ramos, “Ríos Montt Enfrentará Juicio Especial por

Masacre de Dos Erres,” Prensa Libre, March 31, 2017. 20 Sarah Blaskey, Jeff Abbott, “The Military Powers Behind Guatemala’s Comedian Presidential

Front-Runner,” Tico Times, October 9, 2015.

Maureen Taft-Morales 184

Alvaro Colom, reportedly said they received no such bonus.21 Morales’s

former defense minister has been arrested in the case.

Attorney General Thelma Aldana and CICIG

On May 17, 2014, Thelma Aldana replaced former Attorney General Claudia Paz y

Paz. Some people questioned if Aldana, a former head of the Supreme Court seen as

favored by then-President Pérez Molina, would pursue corruption and human rights

cases as ardently as her predecessor. Since assuming her role, Aldana has led

investigations resulting in the forced resignation and later arrest of Pérez Molina and

Roxana Baldetti, then vice president. Aldana is pursuing investigations for alleged

illegal campaign contributions by various political parties. She has pushed for special

prosecutors’ offices to deal with cases involving sexual violence and crimes against

women and children. Both the previous and current attorneys general, as well as judges

on prominent cases, have received death threats. Aldana briefly suspended public

activities and left the country after receiving multiple death threats in 2016.22 Aldana’s

term expires in May 2018.

The United Nations and Guatemala agreed to establish CICIG in 2007. Its mandate

is to help Guatemala dismantle illegal groups and clandestine structures responsible for

organized crime, human rights violations, and other crimes through investigations and

prosecutions, as well as to recommend legal reforms. Many experts agree CICIG has

made significant progress in its goals. In 2015 alone, the Public Ministry arrested about

602 public officials for alleged corruption and abuse of office.23 According to public

opinion polls, CICIG and the Public Ministry are the most trusted institutions in

Guatemala.

Efforts to Combat Impunity and Corruption

In what many observers see as a step forward in Guatemala’s democratic

development, the Public Ministry’s recent corruption and human rights abuse

investigations have led to the arrest and trial of high-level government,

judicial, and military officials. They have also led to a backlash against those

reform efforts, threats against the attorney general and the head of an

21 Martin Rodriguez Pellecer, Javier Estrada Tobar, “Aislado y en pie de guerra, asi afrontan

Jimmy y FCN el Paro Nacional,” Nomada, September 20, 2017. 22 Elisabeth Malkin, Nic Wirtz, “Byron Lima Oliva, Bishop’s Killer, Dies in Attack at Guatemala

Prison,” New York Times, July 18, 2016. 23 “Guatemala Corruption Report,” GAN Business Anti-Corruption Portal, August 2016, p. 5,

http://www.businessanti-corruption.com/country-profiles/guatemala.

Guatemala 185

international commission, and a political crisis involving current President

Jimmy Morales. The Public Ministry, which is headed by Attorney General

Thelma Aldana, is responsible for public prosecution and law enforcement,

and works in conjunction with CICIG to strengthen rule of law in Guatemala.

Since 2007, CICIG has worked with the Public Ministry and the attorney

general’s office to reduce the country’s rampant criminal impunity by

strengthening Guatemala’s capacity to investigate and prosecute crime. The

government invited CICIG to assist with constitutional reforms and

restructuring the judicial system. As a result of collaboration with CICIG,

prosecutors have increased conviction rates in murder trials, and targeted

corruption and organized crime linked to drug trafficking. The Guatemalan

public widely supports CICIG.

The United States, other governments, and international institutions have

expressed broad support for the work of both the attorney general’s office and

CICIG.

The process is currently under way to select a new attorney general in May,

2018, when Aldana’s term expires. Anti-corruption and human rights advocates

express concern that Morales could choose a candidate who will not pursue

corruption cases as effectively as Aldana. A bipartisan group of Members of the

U.S. Congress have called for the selection process to be transparent.

Impeachment of a Former President, Arrest of Another

Public Ministry investigations, coupled with mass public protests, forced

the resignations of the sitting president and vice president in 2015. Attorney

General Aldana and CICIG exposed an extensive customs fraud network, now

known as the “La Linea” case, at the national tax agency (SAT), leading to the

arrest of dozens of people, including the previous and then-directors of the

SAT. After the Guatemalan Congress lifted then-President Otto Pérez

Molina’s immunity so he could be investigated, the attorney general’s office

indicted him, Vice President Roxana Baldetti, and other officials, who then

resigned. The country proceeded lawfully and peacefully to form an interim

government, hold scheduled lawful elections, and elect a new president,

Jimmy Morales, who took office in January 2016.

The related corruption case implicated dozens of high-level government

officials and private-sector individuals as well. Attorney General Aldana

asserted that the “La Linea” case represented “just a sliver of a sprawling

Maureen Taft-Morales 186

criminal enterprise run by the state,” which widely tolerated corruption,

leading to impunity and the strengthening of criminal structures within the

government.24 The attorney general and other observers have raised concerns

about unnecessary delays in the sentencing process due to appeals and other

litigation by defense teams. Baldetti and Pérez Molina remain in prison as

their cases proceed.

Following the historic “La Linea” case, more former and current high-

level officials in the executive branch, the legislature, and the judicial system

have been implicated in corruption cases. Three justices of the Supreme Court

of Justice (CSJ) had their immunity removed to face charges of corruption and

influence trafficking. In late March 2017, authorities arrested various

congressional representatives for corruption. According to Transparency

International, Guatemala ranked 136th out of 176 countries on the

organization’s Corruption Perceptions Index for 2016, the second-worst score

in Central America, behind Nicaragua.

Guatemalan police arrested another former president, Alvaro Colom, in

February 2018. Colom was arrested along with nine former members of his

Cabinet, including former Finance Minister Juan Fuentes Knight, who has

chaired Oxfam International since 2015. The group faces charges related to a

$35 million fraud case involving a new bus system in the capital.

Current Political Tensions

Two days after the attorney general and CICIG announced they were

seeking to lift President Morales’s immunity from prosecution, Morales

declared the head of CICIG, Iván Velásquez, persona non grata and ordered

him expelled from the country. One of Morales’s ministers resigned rather

than carry out the order, and the constitutional court—Guatemala’s highest

court—blocked the order. A Guatemalan congressional committee

recommended that the president lose his immunity. Two-thirds of the 158-

member legislature, or 105 deputies, are needed to remove an official’s

immunity. On September 11, 2017, though, the Guatemalan Congress as a

whole voted to protect the president from further investigation; only 25

deputies voted to remove his immunity. About 20% of the legislators are also

under investigation, with more likely to become so. The legislature fell one

24 The Editorial Board, “A Corruption Crusade in Guatemala,” New York Times, June 11, 2016.

Guatemala 187

vote short of shelving the request permanently, however, so a member of the

Congress may reintroduce the question of lifting President Morales’s

immunity at a later date.

On September 13, the Guatemalan Congress passed a “national

emergency” bill to reduce penalties for violations of campaign finance laws,

and make party accountants—rather than party leaders—responsible for such

violations. Public outcry was such that the Congress repealed the bill two days

later. Thousands of protesters demanded the resignation not only of Morales,

but also of the 107 legislators who voted to weaken anti-corruption laws. On

September 21, the Guatemalan Congress again defeated a vote to lift the

president’s immunity. This time, however, the number voting to rescind his

immunity had risen to 70. In 2015, public protests contributed to the

legislature reversing itself and rescinding the previous president’s immunity.

Morales was losing support within his own government. Several officials

were fired or resigned rather than carry out his order to expel Commissioner

Velasquez. Three Cabinet ministers resigned, saying that as a result of the

political crisis, “spaces of opportunity to carry out our work programmes have

rapidly closed down.”25 Initially, Morales persuaded some of those officials to

stay, but in January 2018 he fired several of them and replaced them with

people he considered stronger allies.

Also in September 2017, Guatemala’s federal auditor said that it is

investigating a substantial salary bonus that the Defense Ministry has

acknowledged paying to the president since December 2016. The monthly

bonus increases Morales’s salary by more than a third, reportedly making him

one of the most highly paid leaders in Latin America.26 Attorney General

Aldana again asked that Morales’s immunity be lifted, this time so that her

office can investigate his bonus from the army. The Congress again voted

against lifting Morales’s immunity from prosecution.

Early in his term, President Morales reached out to policy experts and

international donors for advice on fighting corruption. In April 2016, President

Morales formally requested—and the U.N. granted—the extension of CICIG

25 “Guatemala: 3 Ministers Resign, Citing ‘Political Crisis,’” BBC Monitoring Americas,

September 20, 2017. 26 Sofia Menchu, “Guatemala Federal Auditor to Probe President’s Pay Bonus,” Reuters,

September 12, 2017. Also see http://www.paywizard.org/main/salary/vip-check/world-

leaders-salaries for salary comparisons.

Maureen Taft-Morales 188

until 2019, as its two-year mandate was due to expire in September 2017. His

subsequent efforts to expel CICIG’s commissioner and to question CICIG’s

role, however, have raised serious doubts about his stated commitment to fight

corruption. Public protests in Guatemala have demanded Morales’s

resignation.

Morales said previously that before he left office, he would extend

CICIG’s term again, until 2021.27 In recent months, however, Morales has

suggested that he might not renew CICIG. The U.N. and other members of the

international community, and many Guatemalan civil society organizations,

have expressed strong support for CICIG and its commissioner. A new

organization was launched in February, the Citizens’ Front Against Corruption.

This group of prominent business people, indigenous leaders, academics,

activists, and others expressed public support for both Attorney General Aldana

and CICIG Commissioner Velásquez. U.S. Ambassador to the U.N. Nikki Haley

met with President Morales in Guatemala in February, reporting that “I told him

that we supported CICIG and supported the commissioner.”28 Haley also met

with Aldana and Velásquez, telling them that CICIG should do their job

“quietly. They don’t need to be in the paper every day.”

Judicial Reforms and Efforts to Stop Them

Attorney General Aldana and CICIG have made progress in pursuing

justice for human rights violations that occurred during the civil war. In March

2016 they tried a historic case known as the “Creompaz case”—the first

prosecution for sexual violence committed during the civil war. A Guatemalan

high-risk court convicted two former military commanders at the Sepur Zarco

military base of murder, sexual violence, sexual and domestic slavery, and

enforced disappearances. In March 2017, a judge sent to trial a former military

chief of staff and four other high-ranking military officials accused of crimes

against humanity, aggravated assault, sexual violence, and forced

disappearance. Also in March, the Supreme Court ruled to remove immunity

from FCN-Nación deputy Edgar Ovalle for his alleged involvement in the

27 “Guatemala’s Morales Reiterates Support for Cicig,” LatinNews, October 29, 2015. 28 Michelle Nichols, “U.S. Envoy Tells Guatemala President: We Back U.N. Graft Body, Chief,”

Reuters, February 28, 2018.

Guatemala 189

case.29 As noted previously, Ovalle, a key advisor to President Morales, has

since disappeared. Another case dealing with forced disappearances allegedly

committed by the Guatemalan military during the civil war took a dramatic

turn in March 2016 when a judge seized and made public previously unknown

documents detailing information about military counterinsurgency objectives,

operations, and campaigns from 1983 to 1990. Since the Peace Accords were

signed in 1996, the Guatemalan army had repeatedly denied such documents

existed.

As anti-corruption efforts prove successful, the circle of those feeling

threatened by investigations broadens, and attacks against CICIG and the

judicial system have intensified.30 The U.N. Office of the High Commissioner

for Human Rights (OHCHR) issued a report in March 2017 saying it was

“seriously concerned” about threats and attacks against various judicial

authorities, including both Aldana and Judge Miguel Angel Galvez.31 The

International Commission of Jurists noted concern about efforts to criminalize

lawyers, as well as community leaders, human rights defenders, and public

employees, such as Supreme Court justices.

Civil society groups and elements of the government have called for

further reforms to combat impunity. An April 2017 report from the

International Commission of Jurists found that despite tackling historic cases,

Guatemalan courts still show signs of irregularity and impunity, such as many

judges’ failure to condemn litigation that results in delays of trials. Many of

the accused in the La Linea case still await sentencing almost two years after

the scandal broke, in part because of litigation filed by their own lawyers in

what are widely seen as delaying tactics.

According to CICIG head Iván Velásquez, the work of CICIG and the

attorneys general has resulted in more than 300 people either in prison, facing

trial, or being charged. These include high-level officials, such as the former

president and vice president, five former Cabinet ministers, three former 29 “Diputado Edgar Ovalle pierde su inmunidad y queda arraigado,” Prensa Libre, March 15,

2017. 30 Attorney General Thelma Aldana left the country for a month due to death threats. She, as well

as judges presiding over prominent cases, continue to face death threats and intimidation.

Intimidation has included public and anonymous attempts to discredit the head of CICIG, as

well as other officials, activists, and their organizations. 31 Annual Report of the United Nations High Commissioner for Human Rights on the Activities of

His Office in Guatemala, U.N. General Assembly, A/HRC/34/3/Add.1, March 22, 2017, p.

4.

Maureen Taft-Morales 190

presidents of Congress and various deputies, two former CSJ magistrates, the

former president of the Instituto Guatemalteco de Seguridad Social (IGSS),

two former banking superintendents, and a director of the prison service,

among others.32

President Morales spoke before the U.N. General Assembly in September

2017. He pledged to strengthen and support CICIG, but he also said

Guatemala was revising the interpretation and application of its agreement

with CICIG and no institution should interfere in Guatemala’s administration

of justice.33 On the same day, three of Morales’s Cabinet members resigned

over the political crisis instigated by the president’s effort to expel CICIG’s

commissioner. In February 2018, Morales sent a representative to the U.N. to

express his administration’s concerns about CICIG.

Many in the U.S. Congress have expressed concern over President

Morales’s effort to expel CICIG’s commissioner. The House Foreign Affairs

Committee chairman issued a statement reading, “The U.S. Congress has

spoken with one voice in support of the International Commission against

Impunity in Guatemala. We will continue to stand with the Guatemalan

people, and especially those in poverty, who are hurt most by corruption.”34

The Trump Administration continues to express support for CICIG. U.S.

Ambassador to the U.N. Nikki Haley said that the United States expects the

Guatemalan government to allow CICIG to “do its critical work without

interference.”35 In February 2018 outgoing Secretary of State Rex Tillerson

reiterated the Administration’s support of CICIG.

Various Guatemalan and international organizations consider judicial

reforms necessary to solidify progress against widespread corruption and to

strengthen the judicial branch so it can continue consolidating the rule of law

in Guatemala. Nonetheless, forces opposed to the reforms have emerged as

well.

32 “Latin American Weekly Report,” LatinNews, May 4, 2017. 33 “At UN, Guatemalan President Pledges Government’s Full Commitment to Fight Corruption,”

U.N. News Centre, September 19, 2017. 34 “Chairman Royce Statement on Guatemala,” House Foreign Affairs Committee News Release,

U.S. Government Publishing Office, August 28, 2017. 35 Dudley Althaus, “U.S. Urges Guatemala’s President to Allow Corruption Probe; Comments

from Officials Come a Day After Jimmy Morales Moved to Expel Special Prosecutor,”

Wall Street Journal, August 28, 2017.

Guatemala 191

The Guatemalan Congress approved changes concerning judge and

magistrate selection and requirements. A recent International Commission of

Jurists (ICJ) report concluded that reforming the selection process of judges

and separating judicial processes from administrative processes could

strengthen Guatemala’s judicial system. CICIG and others launched a judicial

observatory of criminal justice to analyze judiciary rulings and make

recommendations to improve the justice system in other ways as well.

The ICJ found that the Guatemalan state has responded passively to

defamation campaigns, attacks on judicial independence, and other forces trying

to influence judges, prosecutors, and investigators.36 According to the director of

the Guatemalan Institute of Comparative Studies in Criminal Sciences, the

groups seeking to stop the reforms are the same elements that launched

defamation campaigns on social media against CICIG head Iván Velásquez in

early 2017.37

Some of the recent actions taken by the Guatemalan legislature represent

efforts to advance various types of reform, whereas others reflect an effort to

reverse or stall reform efforts. The Guatemalan Congress passed two major

reform packages in 2016 after then-President Otto Perez Molina was forced to

resign and was arrested on corruption charges in 2015. The reform packages

were designed to streamline legislative procedures and make political and

electoral system procedures more transparent and equitable. A lengthy national

process produced 60 proposed amendments to the constitution and other laws

to promote judicial reform. Congress did not pass an initial package of the

reforms in 2016 and did not bring it up again in 2017. The most divisive

proposed change was a stronger recognition and use of the indigenous justice

system.

Some observers expressed concern that the new leaders who assumed

office in January 2016 either lack the ability to form the alliances necessary to

push the constitutional reforms through, or were less committed to doing so

due to their links to people under investigation for corruption.38 This latter

view was reinforced by congressional actions in September 2017 preserving

36 Carlos Rafael Rodríguez Cerna Rosada, La Independencia Judicial en Guatemala,

International Commission of Jurists, November 2016. 37 “Se Plantean 60 Enmiendas a Reformas,” Prensa Libre, February 13, 2017. 38 Adriana Beltrán, “Guatemala at a Crossroads: Reinforce the Fight Against Corruption or

Reinstate the Hidden Powers?” Washington Office on Latin America, December 12, 2016.

Maureen Taft-Morales 192

the president’s immunity and trying to reduce penalties for violations of

campaign finance laws.

Nonetheless, the legislature passed two laws in late 2017 intended to

improve the judicial process. One created a Judicial Career Council to relieve

the Supreme Court of having to address internal human resources

administrative matters, and the other created a National Bank of Genetic Data

to be used in judicial processes as well as a Register of Sexual Aggressors.

ECONOMIC AND SOCIAL CONDITIONS

Guatemala has enjoyed relatively stable economic growth in recent

decades, and the World Bank named it a top performer in Latin America.

Guatemala has struggled, however, in recent years to address its high poverty

rates. The country has the largest economy in Central America, with a gross

domestic product (GDP) of $63.794 billion and a per-capita income of $3,590

in 2015.39 The World Bank characterizes Guatemala as a lower-middle-income

country, and it ranks 125th out of 188 on the 2015 Human Development Index.

Guatemala’s stable growth rates have not been enough to decrease some of

the highest levels of economic inequality and poverty in the region. Instead,

Guatemala has backtracked. After decreasing the overall poverty rate from 56%

to 51% between 2000 and 2006, the rate increased to 59% in 2014, with a rate

just over 79% for indigenous people, according to a national survey. Some

elements of Guatemalan society and government have tried to bring about

equitable development, yet its rural and indigenous populations remain socially

and economically marginalized. For rural municipalities, which constitute 44%

of the country, almost 8 out of 10 people live in poverty.40 Demonstrating the

difference in economic and social conditions, literacy rates for the

nonindigenous population were 88.9% for men and 83.7% for women, but rates

decreased to 77.7% for indigenous men and 57.6% for indigenous women 15

years and older.41

39 World Bank data online, at http://data.worldbank.org/country/guatemala, 40 World Bank, Guatemala: Overview, accessed March 29, 2017, http://www.worldbank.org/en/

country/guatemala/overview. 41 Instituto Nacional de Estadística Guatemala, República de Guatemala: Encuesta Nacional de

Condiciones de Vida 2014, December 2015, https://www.ine.gob.gt.

Guatemala 193

The International Monetary Fund (IMF) concluded that Guatemala met

none of the Millennium Development Goals for rural and indigenous

populations in 2015 and met only a quarter of them for the country as a

whole.42 Furthermore, extreme poverty increased and school enrollment

decreased. Nonindigenous children average twice as many years of schooling

as indigenous children.43 To improve social conditions, the World Bank calls

for rapid economic growth coupled with increased public investment and pro-

poor policies. According to the Economist Intelligence Unit (EIU),

Guatemala’s economic growth rate is expected to average out at 3.1% in 2017.

EIU projects growth will likely peak in 2018-2019 at 3.2%, followed by a

slowdown to 2.4% for 2020.44 The EIU concludes that slowed economic

growth and rapid population growth will keep per-capita income growth too

low to reduce poverty.

Factors that impede economic growth and development include

corruption, limited government revenues, weak institutions, and weak

transportation and energy infrastructure. Guatemala’s persistent failure to

deliver services and improve the quality of education and health care

contribute to a low-skilled workforce, which also limits growth. According to

the U.N. Educational, Scientific, and Cultural Organization (UNESCO),

Guatemalan adults had only 3.6 years of education, on average, in 2005, and

“if Guatemala had matched the regional average, it could have more than

doubled [emphasis in original] its average annual [economic] growth rate

between 2005 and 2010.”45

Guatemala has the lowest tax-to-GDP ratio in the region at 12.4%,

compared to 22.8% for Latin America in 2015.46 This is due in part to the high

rate of employment in the informal economy— the Instituto Nacional de

Estadística found that 69.8% of the population held informal employment in

2016, with higher percentages for rural and indigenous segments of the

42 International Monetary Fund Western Hemisphere Department, IMF Executive Board

Concludes 2016 Article IV Consultation with Guatemala, International Monetary Fund,

September 2016, http://www.elibrary.imf.org. 43 UNDP, Human Development Report 2016, March 2017, http://hdr.undp.org/sites/default/files/

2016_human_development_report.pdf. 44 EIU, Guatemela Country Report, generated February 14, 2018, p. 35. 45 UNESCO, “Education Transforms Lives,” 2013, p. 7. 46 Organisation for Economic Co-operation and Development, Revenue Statistics in Latin

America and the Caribbean 2017, March 23, 2017.

Maureen Taft-Morales 194

population.47 Another contributing factor includes the business and elite

sectors’ historical resistance to paying taxes. While the Morales administration

has improved tax collection (see “President Jimmy Morales’s

Administration”), the IMF has called for a tax revenue rate increase to at least

15% of GDP in order to address social, security, and infrastructure needs.48

Land conflicts, especially those involving mining, are contentious, and

often violent, in Guatemala and elsewhere throughout the region.49

Governments often see mines as a source of revenue, potentially for poverty

reduction and social programs. Indigenous populations often object to mining

under current conditions, however, because they say it violates their ancestral

land rights, removes them from and/or damages their source of livelihood,

and/or excludes them from the decisionmaking process as to how mine profits

should be spent. Guatemala is a signatory to the Indigenous and Tribal Peoples

Convention, 1989, also known as the International Labour Organization’s

(ILO’s) Convention 169. The treaty calls on governments to consult indigenous

peoples before permitting exploitation of natural resources on their land.

According to a recent report by the ILO, the Guatemalan government granted

367 mining licenses between its ratification of the convention in 1996 and

2014, and held only 60 community consultations, all of which had expressed

opposition to the projects.50 The report found that Guatemala’s Constitutional

Court had found such consultations nonbinding. Guatemala has not developed

regulations to govern prior consultations.

Ongoing conflicts around land use are likely to continue to delay such

projects. Other types of land conflicts and evictions are related to biofuels,

dams, ranching, and drug trafficking; these are also frequently violent.

47 Instituto Nacional de Estadística Guatemala, Estadística: Tema/Indicadores, February 2018,

https://www.ine.gob.gt/ index.php/estadisticas/tema-indicadores. 48 IMF, op. cit. 49 For example, seven Guatemalan protesters recently won the right to sue a Canadian mining

company in Canadian courts for injuries sustained when Tahoe Resources security guards

sprayed protesters with rubber bullets outside the Guatemalan Escobal mine with rubber

bullets in 2013. “Supreme Court Clears Way for Lawsuit by Mine Protesters in Guatemala,”

Vancouver Sun, June 8, 2017. 50 Organización Internacional del Trabajo, Convenio núm. 169 de la OIT Sobre Pueblos

Indígenas y Tribales en Países Independientes y la Consulta Previa a los Pueblos Indígenas

en Proyectos de Inversión. Reporte Regional: Colombia, Costa Rica, Guatemala, Chile,

Lima, OIT, Oficina Regional para América Latina y el Caribe, 2016. Findings cited here are

on pp. 46, 34, and 15, respectively.

Guatemala 195

Coffee production and prices recovered from a recent decline, and are

expected to help growth in the agricultural sector. Remittances from

Guatemalans abroad boost the Guatemalan economy as they constitute over

10% of the GDP. Remittances grew by almost 15% in 2017, to the highest

level in any year to date.51 Private consumption accounts for 85% of GDP.

U.S.-GUATEMALAN RELATIONS

Traditionally, the United States and Guatemala have had close relations,

with friction at times over human rights and civil/military issues. According to

the State Department, current U.S. policy objectives in Guatemala include

supporting the institutionalization of democracy; encouraging respect for

human rights and rule of law, and the efficient functioning of CICIG;

supporting broad-based economic growth and sustainable development and

maintaining mutually beneficial trade and commercial relations, including

ensuring that benefits of CAFTA-DR reach all sectors of Guatemalan society;

cooperating to fight money laundering, corruption, narcotics trafficking, alien

smuggling, trafficking in persons, and other transnational crimes; and

supporting Central American integration through support for resolution of

border and territorial disputes.52

During his confirmation hearings in January 2017, then-Secretary of State

Rex Tillerson testified that the Trump Administration would continue to support

CICIG and provide foreign assistance to Central American allies to help combat

crime and impunity, and ensure that citizens of those countries have access to a

functioning and fair justice system. The next month, then-Homeland Security

Secretary John Kelly met with President Morales and Commissioner Velásquez

in Guatemala, and reiterated U.S. support for the Public Ministry’s and CICIG’s

fight against corruption.53 On the same day, a U.S. court indicted former

Guatemalan Vice President Roxana Baldetti and former Interior Minister

51 EIU, Guatemala Country Report generated on February 14, 2018, p. 35. 52 U.S. Department of State, “U.S. Relations with Guatemala,” Fact Sheet, December 8, 2016,

accessed October 2, 2017. 53 U.S. Embassy, Guatemala, tweet, @usembassyguate, February 22, 2017, http://pic.twitter.com/

xkY8mg66rs.

Maureen Taft-Morales 196

Mauricio Lopez Bonilla on criminal drug trafficking charges.54 A Guatemalan

court approved a request for Baldetti’s extradition in June 2017, but first she will

face prosecution on four charges of corruption in Guatemalan courts.55 Lopez

Bonilla must first face three counts of corruption in Guatemalan courts. The

United States arrested former Guatemalan presidential candidate Manuél

Baldizón as he entered the country in January 2018. The U.S. Embassy in

Guatemala said the United States would “return Mr. Baldizón to Guatemala to

face justice”; he faces charges of bribery, conspiracy and money-laundering

related to helping the Odebrecht company win construction contracts in

Guatemala. The Odebrecht scandal is enveloping politicians across Latin

America. Baldizón requested asylum in the United States.56

U.S. Vice President Mike Pence, Tillerson, Secretary of Commerce

Wilbur Ross, Kelly, and Secretary of the Treasury Steven Mnuchin attended

meetings with President Morales, as well as his Honduran counterpart and the

Salvadoran vice president, in June 2017 at the Conference on Prosperity and

Security in Central America in Florida. Pence said that addressing migration to

the United States requires strengthening the sending countries’ economies,

including through foreign assistance.57 The Trump Administration has

proposed cutting aid to Central America by 30% compared to FY2017 and

emphasizing security over development.

President Morales followed President Trump’s lead in December 2017 in

announcing his country would move its embassy in Israel to Jerusalem from

Tel Aviv. The change has been widely criticized internationally. In February

2018, Trump met with Morales in Washington, thanking him for his support

on Israel. According to the White House, Trump “also underscored the

importance of stopping illegal immigration to the United States from

54 U.S. Embassy, Guatemala, tweet, @usembassyguate, “Roxana Baldetti and Mauricio Lopez

Bonilla indicted in US Court,” press release, February 24, 2017, http://pic.

twitter.com/W2NQo5AMMg. 55 Associated Press, “Guatemala Court, ex-VP Baldetti Accept Her Extradition to US,” June 15,

2017. 56 Sofia Menchu, “Guatemala businessman, wanted on graft charges, seeks U.S. asylum,”

Reuters, January 21, 2018. 57 Ben Fox, Gisela Salomon, “US, Central America Work Toward Common Ground at Security

Conference,” Associated Press, June 16, 2017.

Guatemala 197

Guatemala and addressing Guatemala’s underlying challenges to security and

prosperity.”58

U.S. Foreign Assistance

The United States has been providing assistance to Guatemala through

regional initiatives: the Central American Regional Security Initiative

(CARSI), for combating narcotics trafficking and preventing transnational

crime; the President’s Emergency Plan for AIDS Relief (PEPFAR); and Food

for Peace. Currently, U.S. assistance to Guatemala is guided by the U.S.

Strategy for Engagement in Central America. The various programs are

integrated for a greater impact in the Western Highlands region of the country,

which has the highest rates of poverty and chronic malnutrition in Guatemala.

According to the State Department, “The overall objective of U.S. assistance

efforts is to create effective structures and organizations sustainable by the

Guatemalan government.” While some structures, such as the attorney

general’s office, have greatly improved their effectiveness with U.S. and other

support, other institutions remain weak.

Top priorities for U.S. bilateral assistance to Guatemala include improving

security, governance, and justice for citizens; improving economic growth;

improving food security and reducing chronic malnutrition; providing access

to health services and fostering adoption of healthy behaviors at the household

level; promoting better educational outcomes; providing opportunities for out-

of-school youth to reduce their desire to migrate; and improving natural

resource management to mitigate the impact of climate change.59

In 2014, the Obama Administration launched the U.S. Strategy for

Engagement in Central America (the Strategy), a whole-of-government

approach aimed at addressing the root causes of illegal immigration from the

region by improving prosperity, regional economic integration, security, and

governance.60 Congress has appropriated $1.4 billion for the Strategy. Much of

58 “Readout of President Donald J. Trump’s Meeting with President Morales of Guatemala,” The

White House, February 8, 2018. 59 U.S. Department of State, 2017 International Narcotics Control Strategy Report, March 2017. 60 See CRS Report R44812, U.S. Strategy for Engagement in Central America: Policy Issues for

Congress, by Peter J. Meyer.

Maureen Taft-Morales 198

the aid has yet to be delivered, however, and the 115th Congress and the Trump

Administration are reassessing U.S. policy in Central America. Through the

2016 Consolidated Appropriations Act (P.L. 114-113), Congress provided up

to $750 million in aid to Central America and placed numerous conditions on

aid. The State Department certified that the governments of Guatemala (and El

Salvador and Honduras) met Congress’s conditions, which included taking

steps to combat corruption, prosecute security forces for human rights

violations, and other actions. Consequently, FY2016 money began flowing to

the region in early 2017. The Strategy complements the Plan of the Alliance

for Prosperity (AFP) in the northern triangle proposed by the presidents of El

Salvador, Guatemala, and Honduras (see “Regional Alliance for Prosperity

(AFP) and Security Initiatives” below).

On May 5, 2017, President Trump signed into law the Consolidated

Appropriations Act, 2017 (P.L. 115-31), which provides $655 million for the

continued implementation of the Strategy, with just under $126 million for

Guatemala and $329 million for CARSI.61

The funds appropriated for Guatemala include $110 million for

Development Assistance (DA); $1.74 million for Foreign Military Financing

(FMF); $13 million for Global Health Programs through the U.S. Agency for

International Development (USAID); and $800,000 for International Military

Education and Training (IMET). The measure also provides at least $6.5

million through Economic Support Fund (ESF) for forensic anthropology

assistance in six countries, including Guatemala; at least $6 million in

International Narcotics Control and Law Enforcement (INCLE) funding for

Central America and Mexico to combat human trafficking; $6 million through

CARSI to support CICIG; and $11 million mostly through CARSI ($500,000

through DA) to support the attorney general/Public Ministry. The act

maintains FY2016 conditions with slightly different language.

The Administration’s FY2018 budget request would cut funds by 36% for

Guatemala and 20% for CARSI compared to FY2017. The request includes

around $81 million for Guatemala, an overall decrease of almost $50 million

from the FY2017 funding estimate (see Table 1). It includes approximately

$77 million for Economic Support and Development Fund (ESDF); $3 million

61 U.S. bilateral assistance in 2017 included $5 million in food aid (as seen in Table 1), but this is

not included in the Strategy total because food aid is considered outside of the Strategy.

Guatemala 199

for Global Health Programs (USAID); and $760,000 for International Military

Education and Training. President Trump’s preliminary 2018 proposal

recommends replacing DA and ESF with ESDF. The Administration’s

FY2019 budget request proposed cutting aid to Guatemala by 40% compared

to FY2017 assistance. The budget request for Central America would tip the

balance toward security and away from traditional development goals—such

as good governance, economic growth, and social welfare.

Table 1. U.S. Bilateral Assistance to Guatemala by Account

and Fiscal Year (in thousands of U.S. dollars)

FY2015

Actual

FY2016

Actual

FY2017

Actual

FY2018

Request

FY2019

Request

FY2017-

FY2019

Increase/

Decrease

Development

Assistance

57,387 112,000 110,000 — — —

Economic Support

Fund

34,000 — — — — —

NEW IN FY2018:

Economic Support

and Development

Fund (Pre FY2018 DA

+ ESF, to compare)

(91,387) (112,000) (110,000) 76,900 65,649 (-44,351)

Foreign Military

Financing

1,000 1,740 1,740 0 0 -1,740

Global Health

Programs-

14,000 13,000 13,000 3,000 3,000 -10,000

USAID

International Military 798 775 753 760 760 +7

Education and Training

P.L. 480 Title II 5,914 3,711 5,000 0 -5,000

TO TAL 113,099 131,226 130,493 80,660 69,409 -61,084

Sources: U.S. Department of State, Congressional Budget Justification for Foreign Operations:

FY2015-2019.

The Administration’s proposed budget would also eliminate traditional

food aid (P.L. 480, Title II), and food aid would be provided only through the

International Disaster Assistance account. Some critics are concerned that

Maureen Taft-Morales 200

reducing nonemergency food aid could increase the already high levels of

malnutrition and stunting in Guatemala. In addition, a recent study by several

major international organizations found that “there is clearly a link between

food insecurity and emigration from [Guatemala, El Salvador and

Honduras].”62

The Trump Administration also would have eliminated the Inter-American

Foundation (IAF), an independent U.S. agency that supports grassroots

development throughout Latin America, including in all three northern triangle

countries. Many IAF programs in Guatemala are in areas that have high levels

of emigration to the United States; these programs aim to improve agricultural

and food production; improve the livelihoods of youth, women, and

indigenous people; and ease the transition of migrants who return to

Guatemala.63

Regional Alliance for Prosperity (AFP) and Security Initiatives

The Obama Administration and some Members pressed the northern

triangle governments (Guatemala, Honduras, and El Salvador) to invest more

heavily in their own development and security. In response to the Central

American immigration crisis in 2014, the Guatemalan, Salvadoran, and

Honduran governments proposed the Plan of the Alliance for Prosperity in the

northern triangle later that year, with the help of the Inter-American

Development Bank. The five-year, $22 billion initiative seeks to (1) stimulate

the productive sector to create economic opportunities; (2) develop human

capital through improved education, job training, and social protections (health

care, nutrition); (3) improve public safety and access to the legal system; and

(4) strengthen institutions and improve transparency to increase public trust in

the state.64 Some observers, including some U.S. officials, criticized the initial

62 Inter-American Development Bank, International Fund for Agricultural Development,

International Organization for Migration, Organization of American States, and the World

Food Programme, Food Security and Emigration: Why People Flee and the Impact on

Family Members Left Behind in El Salvador, Guatemala, and Honduras, August 2017. 63 “Guatemala,” Inter-American Foundation, accessed March 26, 2018, https://www.iaf.gov/our-

work/where-we-work/country-portfolios/guatemala. 64 See El Salvador, Guatemala and Honduras, Plan of the Alliance for Prosperity in the Northern

Triangle: A Road Map, September 2014, http://iadbdocs.iadb.org/wsdocs/get document.

Guatemala 201

plan for not focusing on development and poverty-reduction efforts in the

poorest regions, from which the highest numbers of people emigrate. The

Guatemalan Embassy says that the government has since shifted some of its

programs toward those regions.

In November 2016, Guatemala, Honduras, and El Salvador launched a

trinational task force to address the region’s security issues. The task force

focuses on greater border protection, undertaking operations to dismantle

gangs and criminal structures, taking action against human trafficking,

cracking down on terrestrial drug trafficking across borders, and stopping the

flow of contraband products through the northern triangle.65 The initiative

includes increased information sharing and cooperation among the three

countries’ governments, as well as law enforcement and investigative

agencies.

Trade and CAFTA-DR66

Guatemala and the United States have significant trade relations, and are

part of the U.S.-Central America-Dominican Republic Free Trade Agreement

(CAFTA-DR), implemented in 2006. Supporters of CAFTA-DR point to

reforms it spurred in transparency, customs administration, intellectual

property rights, and government regulation. Critics note that the commercial

balance between the two countries previously favored Guatemala, and that

Guatemala already had duty-free access under the Caribbean Basin Initiative.

Since CAFTA-DR, the balance has shifted in favor of the United States. The

U.S. goods trade surplus with Guatemala reached $1.9 billion in 2016, an

11.9% increase from 2015. From 2005 (pre-CAFTA-DR) to 2015, U.S.

aspx?docnum=39224238. See CRS Report R44812, U.S. Strategy for Engagement in

Central America: Policy Issues for Congress, by Peter J. Meyer. 65 “Presidente Hernández Asegura que ‘Fuerza Trinacional’ con El Salvador y Guatemala Va Por

Buen Camino,” La Tribuna, January 5, 2017. 66 Information in this section is from Office of the U.S. Trade Representative, “In the Matter of

Guatemala – Issues Relating to the Obligations Under Article 16.2.1(a) of the CAFTA-DR,”

https://ustr.gov/issue-areas/labor/bilateral-andregional-trade-agreements/guatemala-submiss

ion-under-cafta-dr, accessed June 27, 2017; Kevin Banks, et al., “Dominican Republic –

Central America – United States Free Trade Agreement Arbitral Panel Established Pursuant

to Chapter Twenty: In the Matter of Guatemala—Issues Relating to the Obligations Under

Article 16.2.1(a) of the CAFTA-DR, Final Report of the Panel,” June 14, 2017; and Isabelle

Hoagland and Jenny Leonard, “Sources: U.S. Loses to Guatemala in FTA Labor Dispute

Settlement Case,” World Trade Online, June 22, 2017. Trade data in this section are from

Global Trade Atlas.

Maureen Taft-Morales 202

exports to Guatemala increased by 106%, whereas Guatemalan exports to the

United States increased by only 31% during the same period.67 President

Trump has ordered reviews of U.S. trade agreements.68

Total U.S.-Guatemala trade in 2016 reached $9.8 billion, and U.S. exports

to Guatemala amounted to $5.8 billion. Mineral fuels, electrical machinery,

articles donated for relief, machinery, and cereals accounted for the majority

of U.S. exports. U.S. agricultural exports include corn, soybean meal, wheat,

poultry, and cotton. U.S. imports from Guatemala amounted to about $3.9

billion, with bananas, plantains, knit apparel, woven apparel, coffee, silver,

and gold accounting for the majority. Guatemala was the United States’ 43rd-

largest trading partner in 2016.

The U.S. Labor Department initiated a dispute settlement process alleging

that the Guatemalan government violated its CAFTA-DR labor commitments,

the first labor rights complaint lodged under a U.S. free trade agreement. In

August 2011, the U.S. Trade Representative officially requested an arbitral

panel. In June 2017, the panel concluded that although it agreed that

Guatemala had failed to effectively enforce its labor laws in certain cases, the

United States had failed to prove that the lack of enforcement negatively

affected trade, as required under CAFTADR. The two parties must now agree

on the resolution of the dispute, which normally conforms to the

determinations of the panel. Some observers say the finding could bring into

question the effectiveness of labor regulations in U.S. free trade agreements

and could affect the renegotiation of NAFTA.

Counternarcotics Cooperation

Guatemala remains a major transit country for cocaine and heroin

trafficked from South America to the United States. Guatemala’s porous

borders and lack of law enforcement presence in many areas enables minor

poppy and opium production, as well as smuggling of precursor chemicals,

67 This and the data that follow are from Office of the U.S. Trade Representative, Guatemala:

U.S.-Guatemala Trade Facts, https://ustr.gov/countries-regions/americas/guatemala,

accessed June 5, 2017. 68 Gregory Korte, “On His 100th Day in Office, Trump Orders Review of Free Trade

Agreements,” USA Today, May 1, 2017.

Guatemala 203

narcotrafficking, and trafficking of weapons, people, and other contraband.

Unlike former President Pérez Molina, current President Morales opposes

legalization of illicit drugs. According to the State Department, an estimated

1,000 metric tons of cocaine are smuggled through the country every year. In

2016, Guatemala recorded record drug seizures, captured high-profile

criminals, and underwent leadership changes in most law enforcement

agencies. The United States provides assistance in the areas of vetted units,

training, and information sharing. The 2017 International Narcotics Control

Strategy Report (INCSR) highlighted the above improvements in Guatemala’s

drug control and border security, but noted the following:

The Guatemalan government will not succeed in building sustainable

counternarcotics mechanisms until it fully implements its laws, reforms

law enforcement and judicial institutions, accelerates judicial processes,

improves interagency cooperation, and provides adequate financial

support to relevant agencies and government ministries.69

Corruption within the Guatemalan government has enabled illicit drug

trafficking. The U.S. Department of Justice requested the extradition of former

Interior Minister Lopez Bonilla, who oversaw the Guatemalan police and

prisons under the Perez Molina administration. The Justice Department

reportedly said that Lopez Bonilla received money from various drug cartels,

including the notorious Los Zetas, in exchange for allowing them to operate

freely across Guatemala.70

Migration Issues

More than 1.3 million Guatemalans live in the United States, of which the

Pew Research Center estimates some 525,000 to be unauthorized.71 From the

1970s to 1990s, the civil war fueled some migration. During the 2000s,

69 U.S. Department of State, 2017 International Narcotics Control Strategy Report, March 2017. 70 Louisa Reynolds, “Former Guatemala Interior Minister Accused of Receiving Money from Los

Zetas,” Noticen, August 17, 2017. 71 Anna Brown and Renee Stepler, Statistical Portrait of Hispanics in the United States, 2014,

Pew Research Center, April 2016; Unauthorized Immigrant Population Trends for States,

Birth Countries and Regions, Pew Research Center, November 2016.

Maureen Taft-Morales 204

migration became motivated by socioeconomic opportunities, natural

disasters, social violence, and family reunification. Unlike their neighbors in

the region, Honduras and El Salvador, Guatemalans have not received

Temporary Protected Status (TPS), which offers immigration relief from

removal under specific circumstances.72 Some Guatemalans benefit from the

Deferred Action for Child Arrivals (DACA) program, which allows people

without lawful immigration status who came to the United States as children

and meet certain requirements to request deferred removal for two years,

subject to renewal.73 On September 5, 2017, the Trump Administration

announced plans to phase out the DACA program over the next six months.74

President Trump later tweeted that if Congress did not pass DACA-like

legislation by that time, he would “revisit” the issue.75 As of the date of this

chapter, no such legislation has been passed. Due to federal court orders in

January and February 2018, DACA renewals are once again being accepted;

new applications for DACA, however, are not.76

From FY2009 to FY2014, the number of unaccompanied migrant children

(sometimes referred to as Unaccompanied Alien Children, or UAC) from

Guatemala apprehended at the U.S. border rose from 1,115 to 17,057, causing

concern among Congress and the executive branch.77 In 2015, the number of

unaccompanied minors apprehended at the border decreased to 13,589, then

fell sharply in FY2016 to 7,520.

To offer a safer alternative to illegal immigration, the U.S. government

launched the Central American Minors (CAM) Refugee/Parole program in

December 2014. The program allows children living in El Salvador,

Guatemala, and Honduras, whose parents reside legally in the United States, to

apply for legal entry to the United States. In July 2016, the U.S. government

72 See CRS Report RS20844, Temporary Protected Status: Overview and Current Issues, by Jill

H. Wilson. 73 See CRS Report R44764, Deferred Action for Childhood Arrivals (DACA): Frequently Asked

Questions, by Andorra Bruno. 74 U.S. Department of Justice, Office of Public Affairs, “Attorney General Sessions Delivers

Remarks on DACA,” Washington, DC, September 5, 2017. 75 Sophie Tatum, “Trump: I’ll ‘revisit’ DACA If Congress Can’t Fix in 6 Months,” CNN,

September 6, 2017. 76 See CRS Legal Sidebar LSB10057, District Court Enjoins DACA Phase-Out: Explanation and

Takeaways, coordinated by Hillel R. Smith and Ben Harrington. 77 U.S. Customs and Border Protection, “Southwest Border Unaccompanied Alien Children

Statistics FY2016,” accessed February 2018, https://www.cbp.gov/site-page/southwest-

border-unaccompanied-alien-children-statistics-fy2016.

Guatemala 205

expanded the CAM program to include additional family members. According

to State Department data, 30 Guatemalans left for the United States under

refugee status and 31 as parolees between the program’s start in December

2014 and March 2017. The CAM program will continue under the Trump

Administration, but remains subject to the suspension of larger U.S. refugee

admissions programs. According to the U.N. High Commissioner for

Refugees, 62% of unaccompanied migrant children interviewed in 2013 did

not mention serious harm as a reason for leaving Guatemala, and 84% cited

hopes for family reunification, increased work or study opportunities, or

helping their families as motivation for coming to the United States.78

The U.S. Strategy for Engagement in Central America and the Central

American Plan of the Alliance for Prosperity in the northern triangle were

developed in large part as a response to the immigration crisis in 2014. They

represent efforts to spur development and reduce illegal emigration to the

United States.

Intercountry Adoption

U.S. laws and policies concerning intercountry adoption are designed to

ensure that all children put up for adoption are truly orphans, and have not

been bought, kidnapped, or subjected to human trafficking, smuggling, or

other illegal activities. Similarly, the goals of the Hague Convention on

Protection of Children and Cooperation in Respect of Intercountry Adoption

are to ensure transparency in adoptions to prevent human trafficking, child

stealing, or child selling, and to eliminate confusion and delays caused by

differences among the laws and practices of different countries. Both the

United States and Guatemala are party to the convention. Because Guatemala

has not yet established regulations and procedures that meet convention

standards, the convention has not entered into force there.

In FY2007, U.S. citizens adopted 4,726 children from Guatemala, more

than from any other country except China (5,453 adoptions). When the

convention went into effect in the United States in 2008, adoptions from

Guatemala were suspended because Guatemala was not in compliance with the

convention’s standards. Since then, the only cases of adoptions by U.S.

78 U.N. High Commissioner for Refugees, Children on the Run: Unaccompanied Children

Leaving Central America and Mexico and the Need for International Protection, May 2014.

Maureen Taft-Morales 206

citizens of Guatemalan children that have been permitted are those that were

already in-process on December 31, 2007.79 There were about 3,000 such

adoption cases pending at the time. As of 2016, all but 3 cases had been

resolved. The U.S. and Guatemalan governments have continued to work

together to resolve the pending cases. Representatives of Guatemalan

adoption-related institutions say that their priority is “to strengthen their

processes and institutions in support of domestic alternatives for children ...

[and that] this needs to occur before they will consider reopening intercountry

adoptions.” The State Department’s Office of Children’s Issues supports those

efforts, while also advocating for Guatemala to develop intercountry adoption

procedures as another option for children who cannot find permanent homes

within Guatemala.

79 This and the following information is from the U.S. Department of State, Intercountry

Adoption, “Guatemala: Hague Convention Information,” accessed by CRS on February 16,

2018, https://travel.state.gov/content/adoptionsabroad/en/country-information/learn-about-

a-country/guatemala.html.

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