The Guatemalaan Economy : The Future Of The Guatemalan Economy
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As a student of the higher education system in the United States, specifically Benedictine University; A great impetus has been placed upon the creation of a well-rounded prospective entrenched in the backing of factual validity. When I peruse the understanding of a specific topic in a field such as economics, like I so often do, with it being my major and all, it is often all too easy to get caught up in specific statistics and completely miss the bigger picture. Regarding the vast topic of how the Guatemalan economy operates within its own boarders and abroad, there is a lot to look at and simply no easy place to start. So naturally I started with the brewing and consumption of a delightfully aromatized cup of single source Guatemalan…show more content… Yet just how little money coffee producing nations retain for the goods they export and sell.
One might ask themselves why a country like Guatemala continues to base its economy upon the production of coffee, if they only get about ten percent of global earnings back? At first it may not seem as if it is the best financial transaction for them, taking in such low profit margins, while still retaining much of the cost and risk involved in the crops creation. An easy answer to this is yes, their margins are often not great, but they produce enough volume to make it potentially very profitable. Because of the country’s huge commitment to coffee growth, coffee has had Guatemala see great economic reward from time to time. Like in the early 1970’s coffee was turning huge profits. “The economy boomed from 1971 thorough early 1974. Then, as a result of inflation (21.2% in 1973), the world energy crisis, and an annual population growth of 2.9%, the economic growth rate slowed from 7.6% for 1973 to 4.6% for 1974. During the second half of the 1970s, Guatemala's economic performance slowed further; during 1974–80, the average annual growth rate was 4.3%.” (Nations Encyclopedia)
Part of the reasoning for the country’s lack of economic diversity and growth until the last couple decades, lies within what was Central Americas longest lasting civil war. 1996 marked the end of a