Guatemala fights to retain favored trade status with Europe

GUATEMALA CITY – There’s not a cocktail bar in Central London that doesn’t stock Guatemala’s famous Ron Zacapa, an English Starbucks that hasn’t launched a “Guatemala Cappuccino,” or a high-end British supermarket that doesn’t sell petit pois straight from the country’s highlands, according to Guatemalan Embassy staff in London.

Outside the United States, Guatemala’s biggest export market is Europe, and within that: Great Britain. Trade between the two countries has been steadily increasing over the past few years, and with the recently introduced free trade agreement between the European Union (EU) and Central America, commerce from Guatemala to the U.K, and vice versa, is set to grow even further.

Acisclo Valladares has been the Guatemalan ambassador to the U.K. for three years.

“In 2010 we didn’t have any economic investment sections,” says Valladares, who ran for president twice before taking up his current position in London.

Valladares and his team recently chaperoned a group of British businessmen to Guatemala, as part of Explore Guatemala, and helped give them an insight into the commercial opportunities that exist in the country. Investment missions like these led the health insurance giant BUPA to begin operating in Guatemala and Pollo Campero to set up shop in southern England.

After more than a year in planning, the EU free trade agreement with Central America entered into full effect earlier this month, giving the region access to a market of more than 500 million Europeans.

The benefits of the agreement include the elimination of the majority of import tariffs, an improvement in international relations between the two areas and more easily accessible investment markets. However, it’s not just about trade clauses. Central American countries must also abide by development policies such as introducing programs to fund the United Nations’ Millennium Development Goals, which include universal elementary education and the eradication of poverty, among others, and complying with international conventions relating to human and labor rights.

The Guatemalan government was recently warned by an international delegation of labor activists that if conditions in the country for trade unionists failed to improve, it could face losing its favored trade status with the EU.

Guatemalan Labor Minister Carlos Contreras Solórzano says the possibility of Europe closing its borders to Guatemala is a concern for the government.

“Of course it worries us that if the European Union, or whatever other business partner of ours, limits our exportations it will affect our workers because it will be the workers who will be left without jobs. We need jobs and we need to participate in the global market. We’ve made efforts to demonstrate that we want to comply with international labor rules and have a place in the global market,” he says.

The Guatemalan government is currently working with the International Labor Organization to improve working conditions in the country for workers and trade unionists in an effort to remain part of the free trade agreement between the EU and Central America.