Guatemala: Threats and Strengths of the Economy

Although poor social indicators and a low tax burden are a threat to the country's progress, for Fitch the Guatemalan economy has the capacity to overcome external adversities.

Friday, March 22, 2019

After the last visit of Fitch Ratings to Guatemala, representatives of the rating agency expressed the opinion that health, education and security indicators, together with the tax situation, are issues that should concern the country.

See "Risk Rating and Investment Attraction"

The president of Banco Guatemala (Banguat), Sergio Recinos, explained to that "... at the end of their visit, Fitch delegates made observations on social indicators and tax revenues. But the resilience of the economy to external and extra-economic shocks was also recognized. In general, the perception is positive."

You ma be interested in "Risk Perception and High Financial Cost"

Mario Alberto García Lara, former vice president of Banguat, said that "... Fitch could maintain this year's rating for Guatemala because there are no risks of noncompliance with debt service payment commitments, which is one of the aspects of interest in country risk assessments."

Fitch maintained during 2018 the note for Guatemala in BB with a stable perspective.

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More on this topic

Fitch Downgrades Guatemala's Risk Note

April 2020

Arguing that a lower economic growth and a higher fiscal deficit are expected due to the effects of the covid-19, the agency decided to modify from BB to BB- the country risk rating.

The situation of the tax burden in the country is another factor affecting Fitch's decision, which was communicated to the Banco de Guatemala through the preliminary bulletin that the agency sent to the authorities.

Guatemala: Fitch Maintains Debt Rating

June 2015

Noting uncertainty and political instability in the country as the main risk factor for the economy, the rating remains at BB with a stable outlook.

From the press release by Fitch Ratings:

Fitch Ratings-New York-19 June 2015: Fitch Ratings has affirmed Guatemala's long-term foreign- and local-currency Issuer Default Ratings (IDRs) at 'BB' with a Stable Outlook.

Fitch Ratings Affirms Rating of BB + for Guatemala

August 2012

The agency has affirmed the international rating of Guatemala as 'BB +' with Stable Outlook.

From a statement by Fitch Ratings:

Fitch Ratings-New York-31 July 2012: Fitch Ratings has affirmed the issuer default rating (IDR) and the Country Ceiling for Guatemala as follows:

Fitch has affirmed Guatemala's IDRs at BB+

July 2009

Fitch Ratings has affirmed Guatemala's local and foreign currency Issuer Default Ratings (IDRs) at 'BB+'. The Rating Outlooks on both ratings are Stable.

Guatemala's track record of macroeconomic stability, low public and external debt burdens, as well as the government's solid commercial debt repayment history continue to support the sovereign's ratings.

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