What the growth of foreign investment reveals and the structural challenges to attracting capital

In 2025, the amount of foreign direct investment (FDI) to Guatemala increased 8.7% to reach US$1,881 million. The figure is greater than the US$1,729 million received in 2024, which represents an increase of about US$152 million.

The report was recently known by the Monetary Board (JM), after evaluating the economy, which confirms that it grew 4.3% last year.

The result arose in a context of global uncertainty, associated with the immigration and tariff policy promoted by the United States; However, Guatemala managed to position itself in sectoral activities and value chains.

By 2026, the projection aims to reach US$2 billion, in an international context marked by tensions, especially in the Middle East, which have pressured the rise in oil barrel prices since the end of February and generate expectations among decision makers.

Five countries concentrate 81% of foreign investment

The report classifies flows by country of origin and by sectoral activities, in accordance with the procedure manual.

When broken down by country of origin, 81% of the total, which represented US$1,526 million, came from five countries, the main investors. In first place is Central America and the Dominican Republic, with US$455 million; Colombia, with US$398 million; United States, with US$325 million; Mexico, with US$231 million, and other countries, with US$117.3 million.

In the same trend, other capitals stand out, such as the Netherlands, with US$111 million; Luxembourg, with US$109 million; Spain, with US$53 million; South Korea, with US$48 million; Germany, with US$17 million, and Sweden, with US$13 million.

FDI focuses on five key activities

The report indicates that, in the classifier by sectoral activity of FDI in 2025, Five activities together total US$1,742 million, which represents 92.6% of the total registered by the Bank of Guatemala (Banguat).

For example, financial and insurance activities recorded US$855 million; vehicle trade and repair, US$358 million; manufacturing industries, US$203 million; information and communications, US$187 million, and the supply of electricity, water and sanitation, US$138 million.

These were the activities that recorded the highest concentration of foreign capital last year.

The list also includes transportation and storage, with US$53 million; other activities, with US$43 million; construction, with US$31 million; exploitation of mines and quarries, with US$7.3 million; agriculture and livestock, with US$1.9 million, and accommodation and food service activities, with US$1.5 million.

FDI grows 8.8% but without structural impulse

Enrique Font, president of the Guatemalan Chamber of Industry (CIG), indicated that the main origin of these flows was Colombia, with US$398.1 million, followed by the United States, with US$325.3 million. By economic sector, investments were mainly concentrated in financial and insurance activities, which raised US$855.2 million, and in commerce, with US$358.6 million.

“This composition suggests a high concentration in sectors relevant to economic activity, but with a lower level of sophistication and limited impact on the structural transformation and the added value of GDP. The year-on-year growth of FDI was 8.8%, in line with its historical averages, which shows the absence of a driving factor that drives a more accelerated expansion of investment flows into the country,” he added when asked about the results.

He stressed that This behavior reflects an investment environment that, although stable, It still lacks sufficient incentives to attract projects of larger scale or technological complexity.

“FDI is synonymous with formal employment and greater competitiveness, so, from the perspective of the industrial sector, it is important to generate a favorable environment that allows companies to develop their projects efficiently and sustainably. This implies strengthening legal certainty, improving infrastructure, simplifying administrative processes and promoting public policies that encourage investment,” he emphasized.

Investment would maintain growth rate

Along the same lines, and regarding FDI expectations for 2026, which would be around US$2 billion, the president of the CIG considers that The stated goal is achievable.

He justified that, when analyzing the historical trend of Foreign Direct Investment (FDI), It is observed that the growth rates average around 9.26%, which, if maintained, would allow us to approach said figure in the short and medium term.

“This behavior reflects a stable growth base that, under appropriate conditions, could be consolidated into a more dynamic trajectory. CIG has also identified a set of specific short-term opportunities. There are companies interested in integrating the country into their global production chains, as well as others that are evaluating their entry into the national market, which shows Guatemala’s potential as an investment destination and reinforces the viability of greater FDI growth,” Font noted.

Structural challenges slow capital arrivals

The president of the CIG also announced what the country needs to attract more capital. He recognized that structural challenges persist that directly affect the relative stagnation of investment flows.

Among them stands out the limited availability of competitive incentives for new investments and reinvestments, compared to other countries in the region that have adopted more aggressive capital attraction schemes.

In addition, The absence of a clear industrial policy that strategically guides priority sectors is evident. and define a long-term roadmap for the country’s productive development.

Added to this are weaknesses in administrative processes, particularly in streamlining procedures for the opening and operation of companies, which increases costs and market entry times.

In addition to the issue of infrastructure, as well as legal certainty, these are aspects that limit the ability to attract investments.

“In this context, although Guatemala has improved its positioning as an investment destination, the absence of comprehensive structural reforms continues to restrict its potential to fully capitalize on the opportunities derived from global trends of productive relocation,” reiterated the president of the CIG.

Keys to boost FDI in Guatemala

These are some approaches to attract more foreign direct investment (FDI) within the framework of the nearshoringwhich have emerged in various activities and forums:

A modern investment law

Guatemala needs to update its legal investment framework to provide legal certainty, agile processes and clear rules, with transparent mechanisms and defined timelines. This will reduce discretion in decision-making, facilitate the arrival of new projects and increase investor confidence.

Clear incentives for the development of productive clusters

Specific fiscal, financial or technical incentives must be established for the formation of clusters in key sectors, with a clear narrative to attract strategic investment and allow agile communication between different companies.

Improve the country’s competitiveness

To attract foreign investment on a sustained basis, Guatemala must strengthen its competitiveness in structural terms. This implies not only resolving logistical or regulatory bottlenecks, but also raising the systemic conditions that make a country more productive, reliable and attractive compared to its regional and international competitors. Some of these elements are:

• Effective inter-institutional coordination: State institutions must work in an articulated manner. However, many initiatives advance in a fragmented manner or without continuity, which is why it is necessary to create public-private governance mechanisms that define shared priorities that are sustained over time (for example, inter-ministerial single windows for investment).
• Sustained investment in critical infrastructure: Guatemala needs to increase investment in ports, roads, customs and electrical systems, with a focus on operational efficiency, resilience and adaptation to future demand. Without sustained improvements in this area, the country will not be able to offer the response times and logistical costs required by the nearshoring.
• Effective interconnection between productive regions and main logistics routes: A functional and strategic road network is required that integrates emerging industrial zones with key logistics routes, especially to Puerto Quetzal, Santo Tomás and customs with Honduras and El Salvador.