The Ministerial Agreement was published in the Diario de Centroamerica, which specifies the four phases to be applied for the de-escalation of containment measures for the reactivation of economic activity in the country.
According to the official document, Phase 0, which is called "De-escalation Preparation", will provide relaxation of the confinement measures that will allow relief to citizens and workplaces, allowing mobility outside the home.
After the Guatemalan government carried out total closures of economic activity for three consecutive weekends in the context of the covid-19 outbreak, the president announced that there would be no total suspension of operations for the week of June 1-7.
Another change is that the curfew will now be 18 hours to 5 am next day, reported the night of May 31 President Alejandro Giammattei on national television.
Discounts and offers, increase in the price level generally and the rise in operating costs due to new health and safety protocols are the main threats to the profitability of companies in this new commercial reality.
Given this context of economic and health crisis, which derives from the outbreak of covid-19 at the global level, Ariel Baños, a specialist in price management and founder of Fijaciondeprecios.com, explains what are the main threats that could affect the profitability levels of companies, and details some strategies that could be applied to mitigate the adverse effects.
In Guatemala, a legislative project prohibiting cuts in water, electricity, cable TV, telephone and Internet services during the state of calamity, which was decreed by the outbreak of covid-19 in the country, was published.
After multiple struggles, Decree 15-2020 was published on May 21 in the Diario de Centroamérica, which was approved by the deputies and then vetoed by President Alejandro Giammattei.
By presidential decree and in order to mitigate the outbreak of covid-19 in the country, from May 14 at 6 pm until May 18 at 5 am, there is total restriction of movement and closure of all commercial establishments.
The measures to restrict movement include the heavy transport of fuel and its derivatives, and the operation of the banking system is prevented, reported President Alejandro Giammattei on the night of May 14.
After the Economic Activity Confidence Index reported a 19% drop in March 2020, in April the situation worsened with a -43% year-on-year variation, a drop that agrees with the advance of the health crisis in the country.
In April 2020, the level of the Economic Activity Confidence Index stood at 32.64 points, 43.25% lower than that recorded in March 2020 (57.52 points) and fell by 26.83% compared to April 2019 (44.61 points), reported the Bank of Guatemala.
Once the local economy begins to return to normal, as isolation and mobility restrictions are relaxed, it is estimated that Guatemalan households will have reduced their demand for car insurance by 7%.
Using a demand/income sensitivity model developed by the Trade Intelligence Unit of CentralAmericaData, it is possible to forecast the variations in demand by Guatemalan households for different goods and services as the most critical phases of the spread of the covid-19 are overcome and the measures restricting mobility in the country are lifted.
Including the respective prevention protocols to avoid the spread of the virus, cinemas, beauty salons, auto parts sales, non-contact sports training centers, gyms and swimming schools will be able to open to the public as of May 1st in Costa Rica.
The protocols must be constructed between the institutions and the respective sectors, who may send their proposals to the Ministry or Executive Presidency as appropriate, reported the Ministry of Health.
Given the crisis in the region, businessmen in Guatemala report that smuggling of Mexican products has increased, while in Panama, beer producers attribute the rise in illegal trade in alcoholic beverages to the dry law.
With the spread of Covid-19, governments in Central America have decreed mandatory quarantines and have also restricted the movement of consumers at certain hours.
The government decided to extend the travel restrictions until April 27, but now the ban on people and vehicles applies only between 6 p.m. and 4 a.m. the next day.
Supermarkets, grocery stores and corner shops will be able to adjust to the new restricted hours, that is, from 4 a.m. to 6 p.m., as long as they ensure that their workers are in their residences before 6 p.m., President Alejandro Giammattei reported on a national channel.
Guatemalan businessmen believe that in order to reactivate economic activity in the country, it is necessary to restrict the number of people in public spaces and increase the number of tests performed on those who have signs of carrying the virus.
The government decided to extend for two more weeks the measures restricting freedom of movement, which includes the transit and movement of persons, crew, passengers and vehicles, between 4 pm and 5 am.
The restriction measures were decreed with the aim of containing the spread of covid-19, and the text detailing the government's provisions was published in the March 29 edition of Diario de Centro América.
The Ministry of Economy will be in charge of setting the average price list of the products of the basic basket that will be in force in the country.
Article 3 of the decree approved by the Congress of the Republic explains that "... the Ministry of the Economy will set the average price list as of March 15, 2020, for each of the 34 products that make up the Basic Food Basket in its different forms of presentation, unit, pound, quintal, etc."
Once the Central American economies begin to return to normal, as the restriction and quarantine measures that have been taken to prevent the spread of the covid-19 are relaxed, household consumption patterns will have changed significantly.
For example, the demand for meals out of home will decrease by about 7% from the levels reported prior to the crisis.
As a result of the crisis generated by the spread of the covid-19, during the following three months companies in Guatemala will be able to defer payments to Social Security, Irtra and Intecap.
The boards of directors of the Guatemalan Social Security Institute, the Workers' Recreation Institute (Irtra) and the Technical Institute for Training and Productivity (Intecap), reported that the payments of employer's contributions for March, April and May were suspended, to be deferred in the second half of the year.
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