The Scourge of Smuggling

The impact of illicit trade in Guatemala is such that "in the case of the paper industry, smuggling has grown to the point of taking away a portion of the market from companies and 30% of their turnover."

Thursday, November 30, 2017

Guatemalan businessmen say that out of every ten products sold in the country, three are of illegal origin. The impact of illicit trade on business activity can already be seen in the turnover of companies, who are also forced to reduce their employee payrolls.

See: "Contraband Growing in Honduras"

"The president of the Guatemalan Chamber of Food and Beverages (CGAB), Roberto Herrarte, told Elperiodico.com.gt that " ... lack of 'political will' has allowed an increase in the entry of illicit products into Guatemala, products on which taxes are not paid and which do not comply with health permits, and which from here will move on to Honduras and El Salvador."

Enrique Lacs, executive director of the CGAB, indicated that companies have started to dismiss employees because of sales losses associated with contraband.  "If for every Q1 million that a company sells, it generates about 20 jobs, the opposite happens if a sale is made with contraband products." For example, in the case of the paper industry, contraband has grown to the point of taking away a portion of the market from companies and 30% of their turnover. "The costs of the lost percentage can not be borne by the companies, and they are forced to let go of staff," said Lacs."

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