Economic and Social Development – 2003
2003
A continuing decline in the price of coffee in the global market exacerbated the difficulty the agricultural sector in Guatemala was already experiencing since 2001. The Government agreed to fund a “coffee emergency” plan, which was designed to assist rural peasants by encouraging crop diversification and helping unemployed Guatemalans in rural areas acquire land.1
Overall, the 2003 budget improved over the previous year’s budget, but there were some significant shortfalls. The Presidential Office for Legal Assistance and Dispute Settlement in Land Matters was defunded in the 2003 budget. The Government provided some temporary provisions, but the office staff and coverage area were severely cut. Budget allocations for the Land Trust Fund similarly fell below the amount set by the Agreements. The Ministry of Health also suffered cutbacks, resulting in reductions in basic preventive services, especially in rural and indigenous areas.2
Some core issues from the armed conflict were left unresolved due to the Government’s incomplete implementation of the Peace Agreements. In particular, public services were deficient, rural development efforts did not significantly increase opportunities for rural communities, and many land conflicts were never resolved. Indicators of economic development showed no improvement in income disparity through the peace process, and an actual increase in extreme poverty toward the end of the implementation phase. Much of the failure to improve economic and social development resulted from lower than expected tax revenues and subsequent spending cuts.3