Guatemala

Guatemala is a country of great cultural richness and geographic diversity, with a young population that represents an important asset for its development. Its strategic location, macroeconomic stability, and potential to boost productivity, investment, and job creation offer significant opportunities to accelerate growth and improve people’s living conditions.

However, deep social, economic, and territorial gaps persist, limiting opportunities for large segments of the population, especially in rural areas and among Indigenous Peoples. These disparities are reflected in high levels of poverty, historical inequality, and challenges in expanding access to quality public services and strengthening trust in institutions.

The country faces significant human capital challenges, including high rates of chronic childhood malnutrition and gaps in education and health. At the same time, high informality and low productivity constrain the creation of quality jobs and opportunities for economic mobility. Women, young people, and Indigenous Peoples continue to face additional barriers to participating fully in the economy and accessing better opportunities.

Guatemala also faces risks associated with phenomena such as El Niño, which can affect food security, the incomes of the most vulnerable households, and the pace of poverty reduction. Pressure on natural resources and persistent territorial gaps compound these challenges, particularly in rural areas.

Closing these gaps will require strengthening human capital, improving the quality and coverage of public services, expanding economic and employment opportunities, addressing infrastructure deficits, and strengthening institutions. These actions will be essential to foster more inclusive growth, generate more and better jobs, and expand opportunities for all Guatemalans.

Last Updated: October 6, 2025

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Guatemala is the largest economy in Central America. Between 2015 and 2025, growth averaged 3.6 percent per year, supported by prudent macroeconomic and fiscal management and a young, expanding labor force. Growth reached 4.3 percent in 2025, driven by higher remittance inflows and private consumption. For 2026, growth is projected at 3.7 percent, followed by an expansion of 3.8 percent in both 2027 and 2028, in line with a gradual moderation in remittance growth. The country continues to maintain low levels of public debt, which is estimated to reach 27.2 percent of GDP in 2026.

Despite this progress, significant social challenges remain. In 2023, 47.3 percent of the population lived on less than US$8.30 a day (2021 PPP). While poverty has been gradually declining, the rate is estimated to reach 45.4 percent in 2026. In addition, chronic child malnutrition continues to affect 46 percent of children under the age of five.

The labor market presents opportunities for improvement, particularly in terms of job quality, in a context marked by high informality and the prevalence of low-productivity jobs with limited social protection coverage. Although informality declined to 64.9 percent in the first quarter of 2026, it remains high. Gender gaps are also significant: only 47 percent of women participate in the labor force, compared to 83.5 percent of men, and women’s labor income is, on average, only three-quarters that of men.

Therefore, strengthening human capital through better education, health, and public services remains a priority. Reducing infrastructure gaps, boosting productivity and investment, strengthening institutional capacity, and improving public investment management are key to generating more and better jobs.

Various external factors, including changes in global economic conditions, fluctuations in fuel prices, developments in remittance flows, and the effects of the El Niño phenomenon on key sectors, could influence Guatemala’s economic outlook.

Last Updated: October 6, 2026

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The World Bank Group’s strategy in Guatemala seeks to expand job opportunities and strengthen sustainable growth through complementary actions in the public and private sectors. This includes investments to strengthen health and nutrition, human capital, resilience, infrastructure, and institutional capacity, together with the mobilization of private capital to expand access to finance, enhance competitiveness, and support productive sectors.

As of September 2026, the Bank has a portfolio of six operations totaling US$1.48 billion. This includes five investment projects: Growing Up Healthy, Rural Infrastructure and Mobility, Smart Public Finance, Airport Sector Modernization, Support for the Energy Transition, and a Development Policy Loan with a Catastrophe Deferred Drawdown Option (CAT DDO) to support Guatemala in the event of natural disasters.

The portfolio is complemented by two trust fund-financed operations totaling US$57 million—the Emissions Reduction Program and the Dedicated Grant Mechanism for Indigenous Peoples and Local Communities—as well as five grants totaling US$4.7 million.

For the same period, IFC’s portfolio in Guatemala exceeds US$4.6 billion in own-account commitments and mobilization, making it IFC’s largest exposure in Central America. The program is led by the financial sector, with US$3.57 billion, followed by infrastructure with US$1.02 billion, and investments in manufacturing, agribusiness, and services totaling US$31.8 million.

The cumulative long-term portfolio totals US$3.13 billion, complemented by US$1.49 billion in short-term finance, reflecting IFC’s commitment to mobilizing private capital and strengthening Guatemala’s competitiveness and sustainable growth.

Among the results achieved, the Growing Up Healthy project strengthened primary health care and nutrition, expanded access to safe water and sanitation, and trained health personnel in seven departments. In addition, more than 4,200 midwives were certified as breastfeeding promoters, 359 health posts were equipped, and 90 facilities were built or rehabilitated, improving access to maternal and child health services. These efforts improve the lives of people in vulnerable communities and are complemented by broader initiatives to strengthen infrastructure and disaster risk management, among others.

Last Updated: October 6, 2026

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The Country Partnership Framework (CPF) of the World Bank Group for Guatemala (2024–2027) with an emphasis on strengthening human capital, disaster resilience, and job opportunities, as well as improving institutional capacity and the inclusion of women and Indigenous peoples.

As part of the World Bank Group, the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA) also support these objectives by facilitating access to financing, promoting public-private partnerships, and reducing investment risks to foster more inclusive and sustainable growth.

You can download the CPF here

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