Economy stagnates in November, raising confidence until late 2023

According to the most recent assessment of the Bank of Guatemala (Banguat), the two indicators that characterize the performance and perception of the Guatemalan economy in the short term by agents and decision makers closed last November with a certain stagnation.

The above, despite the fact that the economy as measured by gross domestic product (GDP) would have closed at 3.5%, as officially reported in the Assessment Report of Monetary, Exchange and Credit Policy 2023, although only closing quarterly GDP For the third quarter, up 3.7% year-on-year.

reduce imae

The function of the IMAE is to measure the real performance of the economy in the short term, and the report shows that in November it was 2.8%, which is higher than the 1.6% registered in October, but this is the level seen at the beginning of 2021, when the indicator was 1.3% ( January that year), just in time for the so-called “rebound” effect or recovery of the economy after the pandemic. The indicator was 3.5% in November 2022 and 3.7% in October.

By November 2023, growth was recorded in the productive sectors of commerce and vehicle repair; Financial and insurance activities; real estate; information and communication; accommodation and food service; and, supply of electricity, water and sanitation.

But five sectors performed negatively in October: accommodation and food services; Construction; exploitation of mines and quarries; Manufacturing Industry; Transportation and storage.

in an interview with free Press, Paulo de Leon, director of economic and financial intelligence at the Central American Business Intelligence (CABI) firm, commented that the blockades and protests recorded would show a very slow period in terms of production, as was the case in the last quarter of 2023. there was a trabon The state of the economy in terms of cash flows”, apart from the fact that it was one of the reasons that prevented investment decisions.

less confident

Separately, Icae is an indicator that aims to measure the perception of economic agents’ confidence in the business and investment climate in the country and when it exceeds 50 points, it is said that such appreciation has improved. ; But when it is low, it reflects a level of indecision or uncertainty that can affect future investment plans and, in turn, other indicators as well.

It closed at 47.06 points in the December measurement, and although this is higher than the 46.62 points in November and 43.06 points in October, the indicator remained below the expansion zone. During the year, only in June it reached the highest score with 53.89 points and then reached the lowest in October with 43.06 points.

According to the results, a survey of economic expectations from a panel of private analysts as of December asked the question: How do you think the business environment for productive activities in the private sector will develop in the next six months compared to the last six months? months? 17.7% thought it would improve; 52.9%, which will remain the same; and 29.4%, that it will get worse.

Furthermore, 76.5% believed that the country’s economy is currently no better than a year ago and 23.5% said that it is; While 64.7% believed that the country’s economic growth will not improve during the next six months and 35.3% said yes.

Finally, 52.9% said they are not sure about the current situation for companies to invest and 47.1% said it is a bad time.

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