Guatemala

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Development Challenge The USAID Program Other Program Elements Other Donors Program Data Sheets Summary Tables USAID Search: Guatemala Previous Years' Activities 2002, 2001, 2000, 1999, 1998, 1997 Last updated: 33     58% of the 11.4 million population lives on less than $2 per day. THE DEVELOPMENT CHALLENGE: Open armed conflict has ended, but many causes of the 36-year civil conflict remain unaddressed. The 1996 Peace Accords offer a framework for addressing these causes and developing a just and prosperous society. Yet, despite the efforts of two successive governments to meet social goals and transform institutions, the country continues to face deep structural problems of poverty, growing inequality, and concomitant ignorance and disease. Guatemala's transition to sustainable peace and democracy is thus still fragile and uncertain. The percentage of poor people in Guatemala has declined in recent years, but absolute numbers of those living in extreme poverty have increased due to one of the highest population growth rates in the hemisphere (2.9%). The poverty in which some 6.4 million people live reflects profound inequalities in Guatemalan society, and a widening income gap between ladino-indigenous societies and rural-urban communities. Two-fifths of Guatemala's population is indigenous. 57% of indigenous children under five years of age suffer from chronic malnutrition. Rural dwellers in Guatemala sufferthe highest infant mortality rates (4.5% of live births in 1999), and high levels of malnutrition. Half of all children under five are stunted; in rural towns the rate can exceed 70%. Limited access to quality basic education leaves the majority under-served (three years average schooling overall, and two years among indigenous populations), especially girls. Adult literacy is low (69% overall and some 48% for rural women). These stark social realities are exacerbated by low public social sector spending-the lowest in the region for education and health. Contaminated water sources, deforestation, and soil depletion threaten biodiversity and agricultural productivity. The Government of Guatemala (GOG) has formulated a Poverty Reduction Strategy and is allocating its scarce budget resources for this priority. Efforts to reduce poverty have been hobbled by falling economic growth rates, (down to 2.5% in 2001 due to the impact of Hurricane Mitch), low coffee prices, and global recession. The most recent published figures indicate that Guatemala's external debt is about $2.6 billion, or a relatively modest 14% of GDP. As economic opportunities have receded, a parallel rise in violent crime brings increasing numbers of Guatemalans to question the value of democracy versus authoritarian solutions. While rule of law and human rights improvements have occurred, corruption, lack of accountability in state institutions and impunity continue unabated, compounding current governance problems. The potential for conflict remains, given the history of ethnic exclusion, limited economic opportunities, and the prevalence of organized crime and drug trafficking--all of which threaten prospects for "growing" out of poverty and pose increasing concerns for the stability of Central America's most populous nation. The national elections in 2003 make the coming year critical, given Guatemala's need to democratically elect a new president who will address key national issues. U.S. support to the peace process at this stage, therefore, is crucial to help propel peace and structural reforms, and further key U.S. interests in Guatemala, Central America and the hemisphere. Improved living conditions to address social polarization and strengthen democracy can help stem illegal immigration to the United States, increase physical security and strengthen Guatemala as a trading partner. In addition, continued U.S. support will help enhance regional cooperation on terrorism, money laundering, and drug trafficking. Approximately 66% of cocaine detected departing South America toward the U.S. in 2000 was shipped through the Meso-American Corridor. Money laundering is rampant; Guatemala was declared noncooperative on money laundering last year by the Organization for Economic Cooperation and Development. Cooperation to contain organized crime is important for U.S. homeland security and long-term U.S. interests in the region. THE USAID PROGRAM: FY 2002 Estimate: $53.478 million FY 2003 Request: $52.204 million The Program Data sheets provided below cover the five objectives for which USAID is requesting funds, and one special objective that supports the peace process. DA, CSH, and P.L. 480 resources will support five sectoral programs for: 1) more inclusive and responsive democracy and strengthened local government; 2) increased access to quality basic education for rural children in targeted Peace Zone areas, improved rural educational services, and multicultural educational policies; 3) better health services for rural women and children and improved management of maternal-child health programs; 4) increased rural income and food security through higher value production and marketing by small-scale farmers, microenterprise services, and food aid to reduce chronic malnutrition in small children; and 5) improved sustainable management and increased local participation in protection of natural resources. These programs are described in the FY 2002 Budget Justification. Some programs were recently adjusted to address the increased rates of chronic and acute malnutrition among children in seven departments. This outbreak of child malnutrition stems from the rural economic crisis. Funds provided under the Partnership for Prosperity will address the rural coffee crisis and support the GOG's Rural Development Strategy. ESF resources will continue to support implementation of key Peace Accord commitments under USAID's Special Objective. Priority programs include human rights and rule of law reform, anti-corruption, and modernization of the state. ESF funding under democracy will provide support to promote free and fair elections. ONGOING PROGRAMS FOR WHICH NO NEW FY 2002 OR FY 2003 FUNDING IS REQUESTED: Number: Title: Last Notified: Planned Completion: 520-007 Hurricane Mitch Recovery FY 2002 CBJ, p. 257 FY 2002 OTHER PROGRAM ELEMENTS: USAID activities not managed directly by USAID/Guatemala include the LAC Bureau's Program for Educational Reform in the Americas (PREAL) which has provided small grants to Guatemalan educational organizations to support policy innovations and system reforms. Other LAC Bureau-sponsored projects promote mechanisms for human rights and the rule of law, support decentralized local governance through assistance to the Guatemalan municipal association, and - through the International Criminal Investigation Training and Assistance Program (ICITAP) - provide training in basic criminal investigation to national police. Under the Parks in Peril program, The Nature Conservancy is partnering with local nongovernmental organizations (NGOs) to improve protection and biodiversity in the Lake Atitlan and the Motagua/Polochic watersheds. The Women in Development office of the Economic Growth, Agriculture, and Trade Bureau is assisting girls' education. Grants from the Private and Voluntary Cooperation Office of the Bureau for Democracy, Conflict, and Humanitarian Assistance assist Guatemalan NGOs in improved crop production/marketing services and support an important child survival initiative. OTHER DONORS: Donor coordination is structured to reinforce policy dialogue with the GOG supporting reforms called for under the Peace Accords. The United States continues to be among the largest bilateral donors supporting the peace process. Other bilateral donors include Spain, Germany, Norway, Sweden, and Japan. Major multinational donors include the Inter-American Development Bank (the largest donor), the World Bank, the Central American Bank for Economic Integration, United Nations agencies, and the European Union. Program Data Sheets 520-001   More Inclusive and Responsive Democracy 520-002  Better Educated Rural Society 520-003  Better Health for Women and Children 520-004  Increased Rural Household Income and Food Security 520-005  Improved Natural Resources Management and Conservation of Biodiversity 520-006  Support the Implementation of the Peace Accords Country Background Information Resources     CIA Factbook Library of Congress National Geographic Country Maps State Dept. Country Information

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