Guatemala primarily exports lead, gold, silver, nickel, zinc and oil. The country has a relatively small extractive sector, which contributed 0.6% of total government revenues and 1.2% of the national GDP in 2017. Mining activity has decreased over the past years due to closures and temporary suspensions of several mines, which resulted in a downturn in mineral exports. While oil production is limited, it represented a quarter of Guatemala’s exports earnings from the sector in 2017.
Guatemala’s mining sector has been the source of several social conflicts, some resulting in judicial claims and bills submitted in the National Congress. In 2017, the Supreme Court suspended the license to operate to one of the largest mines, San Rafael. EITI reporting has listed several bills aiming to reform the extractive sector, including a moratorium in mining and hydroelectrical operations.
Guatemala joined the EITI with the aim to improve public understanding of extractive sector management and to support capacity building for members of the EITI multi-stakeholder group. Opportunities remain for the EITI platform to be used to inform public debate and reform on matters of public interest that pertain to how the sector is managed and benefits communities.
Economic contribution of the extractive industries
- to government revenues
- to exports
- to GDP
- to employment
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- A 2017 report, published with the support of GIZ, outlines opportunities for collaboration between EITI Guatemala and EITI Perú to strengthen the impact of EITI implementation in both countries.
- In 2016, a group of civil society organisations published a study on the contribution of Guatemala’s mining sector to development.
Guatemala’s mining sector is governed by the Mining Law and its Regulations, while the oil and gas sector is governed by the Hydrocarbons Law and its Regulations. Both sectors are regulated by the Ministry of Energy and Mines (MEM). The General Mining Directorate oversees the development of the mining industry, while the General Hydrocarbon Directorate oversees the hydrocarbon sector. The legal frameworks and supporting legislation for the mining and oil and gas sectors are listed on the government’s website.
The tax framework for the extractive sector consists of royalties, private funds and taxes, such as corporate income tax. Taxes are collected by Guatemala’s tax administration, SAT, and royalties are collected by the Ministry of Energy and Mines.
Hydrocarbons contracts are awarded by public bidding and direct negotiation in the form of services contracts, operation contracts and production sharing contracts (PSCs), and are approved by the President of the Republic and the Cabinet. These are published in the official diary as governmental agreements.
Mining prospecting, exploration and exploitation licenses are awarded by the General Mining Directorate under the Ministry of Energy and Mines. Applications must include an environmental mitigation or impact assessment. Mining licenses are listed in Guatemala’s EITI Reports and on the Ministry of Energy and Mines’ website.
Guatemala does not have a legal framework mandating the disclosure of beneficial ownership and does not disclose information in its government systems or EITI reporting.
Revenues collected from mining companies are allocated to the national treasury, while those from the oil and gas sector are allocated to the national treasury and the national development fund, FONPETROL, in accordance with Decree 71-2008.
FONPETROL, in turn, allocates a share of revenues to departments and municipalities in accordance with an applicable legal formula.
EITI-Guatemala is administered by the Guatemala Multi-Stakeholder Group (MSG), also known as the Comision Nacional. The MSG is hosted by the Ministry of Energy and Mines and chaired by the Vice President of Guatemala, Guillermo Castillo Reyes.
Government announces commitment to join the EITI
Candidature application is submitted
Multi-stakeholder group is formed
2010-2011 EITI Report published
Designated Compliant country
2012-2013 EITI Report published
2014-2015 EITI Report published
2016-2017 EITI Report published
2018-2020 EITI Report Published
Next Validation is expected to begin
Guatemala was found to have made inadequate progress in implementing the 2016 EITI Standard in January 2020, following its first Validation. The Validation identified 18 corrective actions to be addressed by the country’s next Validation, expected to commence in October 2022.