Guatemala
From the Guatemalan highlands to the world
It seems to have been fate when back in 2014 Ana Sophia Reyes and her partner Juan Augusto visited the touristic area of Lake Atitlán in Guatemala’s southwestern highlands.
Harnessing Agricultural Trade for Sustainable Development: Guatemala
This study is part of a series of UNCTAD publications that focus on policies in three countries Guatemala Vanuatu and Malawi aimed at upgrading and diversifying specific agricultural sectors of rural economies in developing countries with a view to raising living standards among small-scale farmers in a context of female empowerment and food security and above all sustainable development. The study analyses three agricultural sectors in Guatemala – potato cocoa and cardamom - in terms of opportunities derived from trade of primary and processed products. The focus is on the growing trend among consumers in high income countries for artisanal fair-trade organically grown single-origin products that allow niche market penetration by integrating into their traded products a narrative on the history and lives of local farming communities where the primary product is cultivated. The study bears in mind the heavy costs to implement Voluntary Sustainable Standards internationally-accepted certification systems or consumer-driven specific standards set by retailers looking at domestic sales opportunities for example within Guatemala’s growing tourism sector which also allows farmers to hedge against price fluctuations in international markets. According to the study’s sustainability analysis the strategies presented are aligned with sustainable development goals integrating environmental social welfare gender equality a more equitable distribution of income and more diversified income opportunities. Outcomes are expected to be positive overall but the study nevertheless advises care in implementation to minimise any unforeseen and potentially negative long-term impacts for example on issues such as staple food production. It further cautions on possible perverse consequences whereby without successfully integrating small-scale farmers in the product value-chain the strategies’ principal beneficiaries may rather be intermediaries. This report concludes with a set of recommended sustainable development policies that take into account food security and the importance of agriculture not only for small-scale farmers but for Guatemala’s economy as a whole.
Country overview and development background
Guatemala is located in Central America bordering both the Pacific and Atlantic oceans between the Equator and the Tropic of Cancer. It shares borders with Mexico Belize El Salvador and Honduras occupying an overall area of 108889 square kilometres. Administratively the country consists of 22 departments with 340 municipalities. The Guatemalan territory is mountainous with coastal plains in the south central highlands and northern lowlands. Its geographic location and complex topography provide diverse climatic conditions and vegetation. The range of climatic zones is a source of rich biodiversity and potential for agriculture forestry and hydropower generation. Located in a highly seismic zone at the meetings point of three tectonic plates – North American Caribbean and Cocos - the country is highly vulnerable to earthquakes and volcanic eruptions. Guatemala is also vulnerable to extreme events such as hurricanes floods and landslides.
Cocoa sector
Cocoa grows between 200 and 900 metres above sea level in mild humid climates (1500-3000mm per year) with temperatures between 21 and 26 degrees Celsius. It is shaded by other taller trees to limit the damage to the cocoa tree from direct sun rays. Cocoa trees can grow both on flat lands and moderate slopes up to an inclination of 16 degrees making them widespread throughout Guatemala. Depending on the type of tree nursery used cocoa trees bear cocoa pods two to three years after being planted and produce cocoa for up to 15 years.
Cardamom sector
Cardamom is not native to Guatemala but the country possesses unique climatic conditions for its cultivation which may explain why it has long been a leading world exporter (US$ 486 million in 2015 accounting for 54 per cent of the world trade followed by India and Nepal with 20 and 10 percent). The major difference from other countries exporting cardamom is that Guatemala does not consume cardamom domestically with 99 per cent of production going to the international market making it solely an income-extracting activity significantly exposed to international price fluctuations.
Sustainability outcomes
The goal of this chapter is to assess the sustainability of efforts to upgrade expand and diversify the potato cocoa and cardamom sectors in Guatemala. More precisely to ensure such endeavours are in line with the objectives goals and strategies laid out in the ‘National Development Policy: K’atun Our Guatemala 2032’ which is the country’s highest development framework drawing inspiration from the 2030 Agenda for Sustainable Development.
Executive Summary
This study is part of a series of UNCTAD publications that focus on policies in three countries Guatemala Vanuatu and Malawi aimed at upgrading and diversifying specific agricultural sectors of rural economies in developing countries with a view to raising living standards among small-scale farmers in a context of female empowerment and food security and above all sustainable development.
Upgrading trajectories
As detailed in chapters 2 to 4 the competitiveness of the Guatemalan potato cocoa and cardamom sectors is affected by a combination of a decrease in productivity due to quality issues and the volatility of primary commodity prices. The sectors studied offer a variety of options for small and medium agroprocessing artisanal and handicraft enterprises as well as tourism. Commercialisation options should include any one or a combination of the following: product diversification through designations of origin compliance with existing VSSs packaging and brand strategies and small-scale downstream processing to serve local markets. All of these can benefit from demand-side drivers such as linking current sector capacities to boutique buyers the hospitality industry such as hotels and restaurants and local stores as well as from coordinating farmers’ groups and training them in export processes.
Policy Recommendations
Guatemala like other developing countries faces a critical need for the structural transformation of its economy: while most of the population resides in the rural parts of the country international trade currently provides disproportionately more benefits to the urban population. Agriculture is especially important as almost all the rural population is involved in subsistence farming.
Introduction
This study was conducted to generate knowledge and build awareness and understanding of the social effects of trade-led structural transformation in agriculture. It mainstreams concerns about social inclusiveness and sustainability in order to assist the government in developing sound and complementary trade and agricultural polices supportive of rural livelihoods food security and social inclusiveness. The publication was reviewed and validated by the Ministries concerned and is intended to provide sector-specific evidence-based insights and policy guidance in the following areas:
Potato sector
The potato is native to Guatemala and it is estimated that over 36 varieties are grown there. The high-altitude range for potato farming (1500 to 3600 metres above sea level) and rapid cultivation cycle (90-150 days depending on the altitude) mean that potato production is spread throughout the country and constitutes the fifth most important temporary/annual crop by size of planted area – surpassed by white maize beans yellow maize and sesame (INE 2004). Based on information gathered for this report three quarters of national production is concentrated in Quetzaltenango San Marcos and Huehuetenango providing permanent or semi-permanent employment to at least 70897 families of which two-thirds belong to indigenous ethnic groups. Nationally about 88 per cent of rural families cultivate potatoes at least as a backyard crop where every farmer decides his own time for planting and harvesting. The overall prevalent crop cultivation calendar for small-scale farming of potatoes by broad geographic region is presented in Table 2.
Acknowledgements
This publication was prepared by the Trade Environment Climate Change and Sustainable Development Branch of the Division on International Trade and Commodities UNCTAD. The principal authors were Maria Sokolova Rodrigo Saavedra Zepeda and Eugenia Nuñez who also lead the team of authors under the overall guidance of Marisa Henderson Lucas Assuncao Pamela Coke-Hamilton and Shamika Sirimanne.