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Guatemala is located in the northern part of Central America. It is bordered by Mexico to the north and northwest, Belize to the east, and Honduras and El Salvador on the south. Guatemala has access to the Pacific Ocean from its western coast and the Atlantic through the Gulf of Honduras. The central part of the country is highland and mountain areas, which give way to the narrow Pacific coast and the lowlands to the east. Guatemala is 42,042 square miles (108,890 square kilometers), about the size of Tennessee. Several volcanoes are found throughout the southern part of Guatemala, with Volcan Tajumulco at 13,845 feet (4,220 meters) being the country's highest point. Volcanic eruptions and earthquakes are not unusual.
The climate of Guatemala is tropical. Lowland areas are hot and humid, while the highlands and mountain regions are cooler. Taking advantage of these cooler temperatures, much of the population lives between 3,000 and 8,000 feet (915 and 2,440 meters) above sea level. At these elevations the days are generally warm and the nights cool, with the average annual temperatures hovering around 68 degrees F (20 degrees C). The average temperatures in the lowlands are much more tropical, highlighted with heat and high humidity. Guatemala has a rainy season from May to October and a dry season from November to April. Overall, the country receives an ample amount of rain, averaging about 50 inches (130 centimeters) in the south to over 100 inches (254 centimeters) in some parts of the north.

Guatemala's population is slightly over 11,200,000. Mestizos account for 56% of the country's people while Native Americans comprise the remaining 44%. In the local Spanish, Mestizos are called Ladino. There are few minority groups in the country.

Although Spanish is the official language, it is spoken by only about 60% of the population. A variety of Indian languages are spoken by the rest of the country's people. There are 23 major Indian dialects, including Quiche, Cakchiquel, and Kekchi. Many of these languages are derived from the original Mayan inhabitants of the region.

Roman Catholicism is the dominant religion, however, there are Protestant groups. Some people adhere to traditional Mayan beliefs.

Guatemala is a relatively poor country that trails developed countries in the quality of health care, education, and life style it can offer to most of its people. Life expectancy for men is 63 years and for women it is 70 years. Of the general population, about 60% have access to health care. The literacy rate is only 56%. The best quality of life, of course, can be found in Guatemala City, which is the country's capital. Far from major cities and towns, conditions in isolated regions can be quite primitive.

Over the years, a goal of many Guatemalan governments has been to close the gap between rich and poor. Unfortunately, this gap remains, making uneven distribution of wealth a serious problem for the country. Much of the problem has its beginnings during Spanish colonization when wealthy Spaniards controlled vast tracts of land. Modern Guatemalan society is still trying to rectify the results of those days.

Why then might someone considering retirement even think of Guatemala? There are several reasons. Despite the country's struggle to provide its people with improved living standards, Guatemala has much to offer. The pre-Columbian Mayan world, the colonial days of Spanish control, and an evolving society that is striving forward have all come together to make Guatemala a diverse and exciting nation.

Guatemala City is unquestionably modern and cosmopolitan. The city is a mix of the old and new, where one can experience the culture of the Mayans as it has been handed down through the centuries and yet enjoy the comforts of a modern world. In addition to this, the country does have some tax exemptions which some people considering retirement might find advantageous.

History and Government
A thousand years before the arrival of the Spanish, Mayan civilization flourished throughout the land that has become Guatemala. After the Spanish conquest, Guatemala remained a Spanish colony from 1524-1821. It briefly became a part of Mexico, and then became a member of the United States of Central America, finally establishing itself as a republic in 1839. Guatemala has been a sovereign state since then.
Throughout its history, Guatemala has suffered a succession of civilian governments, dictatorships, and military takeovers. It has been difficult for a tradition of democracy to be established.

Modern Guatemala is a republic, based on a constitution that took effect on January 14, 1986. The chief of state and head of the government is the president, who is elected for a four-year term by universal suffrage. To assist in governing, the president names a Council of Ministers. Guatemala's legislative branch of government is a unicameral Congress of the Republic, and the country's judiciary is based on a system of civil law.

The Economy of Guatemala
Guatemala's economy centers around farming. Family and corporate agriculture accounts for 25% of the country's GDP, employs 3 out of 5 Guatemalans, and supplies about 65% of the country's exports. Sugarcane, coffee, bananas, corn, and beans are some of Guatemala's most important agricultural products. Along with the crops noted, beef is also an important export.
Although manufacturing accounts for about 20% of the GDP, most production facilities are small. Manufacturing employs only 14% of the labor force.

Because of the general weakness of the economy, Guatemala's unemployment rate remains high at about 13%. Moreover, it is estimated that 30% to 40% of those with jobs are underemployed.

Outside of the capital city, much of Guatemala's infrastructure needs improvement. While the telephone system is generally modern in Guatemala City, there are only an estimated 210,000 phones in the country even though there are over 11,000,000 Guatemalans. Roadways in and near the capital are generally good, but as one drives farther from the city, road conditions may deteriorate. The country possesses five ports and numerous airports. Of the airports, however, none can be considered to possess state-of-the-art facilities.

Guatemala City enjoys a modern system of banking. While other parts of the country have access to modern banking, too, the activity of financial institutions is greatest around population centers. The currency of Guatemala is the quetzal.

Tax Facts of Interest
Although Guatemala, as is the case in many Latin American countries, has numerous taxes, there are some potentially valuable exclusions. Income tax, which is calculated from gross income, excludes interest from bonds or titles of the government and its agencies, dividends, including stock dividends, and benefits which had already been taxed in another form in the same period. More importantly, Guatemala follows the Latin American tradition of only taxing income from sources within the country, so a person living in Guatemala with all of their income coming from abroad is totally exempt. For some individuals, these exclusions can lead to large tax savings.
Should you be interested in more information about Guatemala, contact:

The above chapter is taken as a sample from Passport to Tax-Free International Living by Adam Starchild.

The Embassy of Guatemala
2220 R St., NW
Washington, DC 20008
Tel: 202-745-4952-4
Fax: 202-745-1908

Guatemala Tourist Commission
Seventh Ave.
1-7 Centro Civico
Guatemala City
Guatemala
Tel: 31-13-33/47

The Embassy of Guatemala
Carretera 175, K. 11.7
Carraizo Bajo
Trujillo, Puerto Rico
Tel: 809-760-1001
Fax: 809-749-9877

The Embassy of Guatemala
294 Alberto St., Suite 500
Ottawa, Ontario KIP 636
Canada
Tel: 613-224-4322
Fax: 613-237-0492

The Embassy of Guatemala
Zeitenstrasse 16, D-5300
Bonn 2
Federal Republic of Germany
Tel: 228-358609, 351848, 351579
Fax: 228-354940

The Embassy of Guatemala
Calle Rafael Salgado 3, 40. izquierda.
Madrid 16
Spain
Tel: 1-4577827, 2504035, 2500218
Fax: 1-4587894

The Embassy of Guatemala
13 Fawcett St.
London SW 10
Great Britain
Tel: 1-3513042
Fax: 1-376-5708

The Embassy of Guatemala
Kowa Nr. 38 Bldg. Rm. 905, 12-24
Nichi-Azabu
4-Chome, Minato-Ku
Tokyo 106
Japan
Tel: 3-4001830, 4001820
Fax: 3-34001820

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