Role of guatemala in the wto

Carolina Murga Ruiz. EVALUATION OF THE ROLE OF GUATEMALA IN THE WORLD TRADE ORGANIZATION –WTO-: ANALYZING ITS PARTICIPATION WITHIN WTO’S GROUPS

Guatemala has been a Member State of the World Trade Organization since its creation in 1995. According to the Ministry of Economy of Guatemala, which is the Ministry in charge of creating and administrating Guatemala’s economic policies, the generalobjective of the Permanent Mission in the WTO is to protect Guatemala’s interests in the trade field. It also seeks to achieve direct results in market access for goods and services, protection to the competitiveness of the productive sectors, increase in the world trade share, development of technical assistance policies and capacity building (Ministry of Economy, 2006). To achieve this an active,efficient and effective role is needed;

therefore, the purpose of this research is to determine whether the Permanent Mission in the WTO, through the membership in various groups of the WTO, has been fulfilling its objectives throughout the years, in the hopes to improve Guatemala’s level of trade and development.

INTRODUCTION: The Republic of Guatemala is located in Central America,bordering Mexico, the Pacific Ocean, El Salvador, the Gulf of Honduras (Caribbean Sea), Honduras and Belize. The area of the country is 108,890 Km2, and the estimated population for 2009 is 13,276,517 (CIA World Fact Book, 2009). It is a Member State in the BCIE, FAO, G-24, G-77, IADB, IBRD, ICC, IFAD, IFC, ILO, IMF, IOM, ECLAC, LAIA (observer), NAM, OAS, UN,

UNCTAD, UNESCO, UNWTO, WCO, WIPO, WTO,amongst others (CIA World Fact Book, 2009). According to the CIA World Fact Book, the estimated GDP in 2008 was US$ 68.02 billion and the estimated GDP per capita for the same year was US$ 5,200. The sectors that composed the GDP of Guatemala in 2008 are 13.2% of agriculture, 25.8% of industry, and 61% of services. In this respect, the most important agricultural products of

Guatemala aresugarcane, corn, bananas, coffee, beans, cardamom; and the most important industries are sugar, textiles and clothing, furniture, chemicals, petroleum, metals, rubber, tourism (CIA World Fact Book, 2009). The CIA World Fact Book reports that the exports of Guatemala in 2008 were US$ 8.028 billion FOB, and the most important products that were exported were commodities, such

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as coffee, sugar,petroleum, apparel, bananas, fruits and vegetables, cardamom; of these products the main important goods exported are coffee, bananas, apparel and sugar, industry which has been taking advantage of the increase in demand due to the increase in ethanol production. In 2007, the most important exports partners of Guatemala are the United States of America (42.2%), El Salvador (9.6%), Honduras (8.6%),Mexico (6.5%) and Costa Rica (4.5%). The imports Guatemala made in 2008 rose to the amount of US$ 15.42 billion FOB. The goods imported were fuels, machinery and transport equipment, construction materials, grain, fertilizers, electricity; and the most important imports partners in 2007 were United States of America (34.9%), Mexico (9.9%), China (6.8%), El Salvador (4.6%), and Costa Rica (4.1%);(CIA World Fact Book, 2009).

As a mechanism to improve and increase trade with its biggest trade partner, Guatemala, the rest of the Central American countries and the Dominican Republic negotiated and subscribed the Dominican Republic - Central American Free Trade Agreement (DRCAFTA), which entered into force in Guatemala in July 2006. This FTA has contributed in the increase of Guatemala’sexports by reducing tariffs, trade barriers and by making clearer the “rules” of trade between the two countries. Nevertheless, Guatemala could gain much more with DR-CAFTA, but first the country needs to solve internal issues that would help increase the level of investment and trade between both countries. In this same subject, the European Union and the Central American countries are negotiating...