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Guatemala Country Analysis Paper

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Country Overview
Guatemala is located in Central America, bordering the North Pacific Ocean, El Salvador, Mexico, Honduras and Belize. It is the most populous country in Central America with an estimated population of around 15.47 million.
Guatemala used to be the center of the Maya culture during the first millennium A.D. In 1523, Spanish came to this land, destroyed the Maya culture, and made it become a colony for around 300 years. In 1821, Guatemala won its independence. This country suffered a 36-year civil war during the second half of last century, which killed more than 200,000 people and created about 1 million refugees. In 1996, the government ended the conflict formally by signing a peace agreement. Since then, the political stability …show more content…

The data from the World Bank also indicates that Guatemala experienced a rapid growth of economy from 2005 to 2007. The world financial crisis affected this country a lot, making the real GDP growth drop to 0.5% in 2009 from 6.3% in 2007. After 2009, Guatemala has been struggled to recover from crisis. Although the real GDP growth in 2011 reached 4.2%, it dropped again to 3.0% in 2012. It is estimated that it will drop again to 3.4% in 2014 from 3.7% in 2013.

At the same time, the GDP per capita in this country is roughly one-half that of the average for Latin America and the Caribbean. The data of the World Bank shows that the distribution of income remains highly unequal with the richest 20% of the population accounting for more than 51% of Guatemala's overall consumption. More than 50% of the population is below the national poverty line, and 13% of the population lives in extreme …show more content…

The civil war which ended in 1996 left the country deeply fragmented. Land rights issues still exist, with 1.2 percent of the population owning 60 percent of the land. The current housing deficit in Guatemala is over 1.8 million homes. Not enough homes are being built, and many people who have homes lack legal claim to the land or live in inadequate shelter threatened by severe weather, theft or eviction. In addition, homes often have insufficient space or lack access to basic services.
In Guatemala, remittances could be a source of financing for the purchase of a home when basic consumption is fulfilled. Another source of financing is mortgage. The government housing agency, FHA, guarantees about 50% of total mortgages loans. The housing price in Guatemala rises when the mortgage lending grows. Most local banks in Guatemala relies on short-term deposits to fund their longer-term mortgage portfolios, and they tend to overlook the low-income market segment. In 2011, the Overseas Private Investment Corporation (OPIC), a U.S. governmental development finance institution, approved US$100 million for mortgage project in Guatemala, which establishing the country’s first multi-bank, market-wide mortgage platform, targeting low and middle-income

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