Atlantic Council
Adrienne Arsht Latin America Center
Leaders of the Americas Event

President Alejandro Giammattei: Reactivating Guatemala’s economy post COVID-19

President Alejandro Giammattei,
President of Guatemala

Introductions by:
Jason Marczak,
Director, Adrienne Arsht Latin America Center
Atlantic Council

Ana Palacio
Board Member, Atlantic Council;
Founder, Palacios y Asociados;
Former Minister of Foreign Affairs (2002-2004), Spain

Time: 11:00 a.m. EDT
Date: Thursday, May 21, 2020

Transcript by Isabel Kennon

JASON MARCZAK: Good morning, I am Jason Marczak, director of the Adrienne Arsht Latin America Center. First, quickly in English, if you would like translation and you are using the Zoom platform, please download the Interprefy app. The other option is to listen to this conversation on YouTube. Now I will be speaking in Spanish. Welcome to the third episode of our new series, Leaders of the Americas. The purpose of this initiative is to convene the top leaders throughout Latin America so we can discuss the most salient topics of the region. Today, we are joined by President of Guatemala Alejandro Giammattei. Mr. President, welcome. Mr. Giammattei is joined by Minister Brolo, and Ambassador Quiñones. This series began a month and a half ago, with the president of Colombia, Ivan Duque, who was followed by the Venezuelan interim president, Juan Guaidó. President Giammattei, today we will be talking about your COVID-19 response and your plan to reactivate the economy. Mr. President, we applaud you and your work during this important time. I would now like to give the floor to Ana Palacio, Atlantic Council board member and former minister of foreign affairs for Spain.

ANA PALACIO: Thank you very much Jason, I’d like to say that this is a special honor to welcome Dr. Alejandro Giammattei, President of the Republic of Guatemala, because I had the honor of meeting him and having an extremely interesting conversation when he was just starting his administration back in January. It seems such a long time ago, although it is only a few months ago. From this meeting, I recognized the president’s commitment to Guatemala and his strategic vision. Dr. Giammattei — I am going to call you Dr. Giammattei — President Giammattei brings large expertise because he is a physician, he is a doctor, and this conveys both safety and security. He also has important local experience – he has been a director of the Guatemalan penitentiary system and he has also worked in the private sector.  There is no way of driving in this situation without a public-private partnership, so we have high quality leader in a key region. I would like to share an anecdote if I may. After having that conversation with the president Giammattei, I thought it was so interesting that I stopped on my way back to Spain in Washington to meet Jason Marczak and María Fernanda Perez from the Atlantic Council, and we had a conversation. I told them that there is an extremely interesting individual leading Guatemala, and that I was particularly impressed by his clear language and his infectious energy, as well as his great realistic ambition. This is not a common trait in rulers. It is a great pleasure to be here. I give the floor back to Jason Marczak. I know that we will have an extremely interesting conversation. Thank you very much.

MR. MARCZAK: Thank you Ana. Mr. President, you began your presidency with a plan to reactivate the economy and to fight corruption, among other priorities. However, two months in, Guatemala saw the first case of coronavirus that impacted different economic sectors. Guatemala has over 2200 confirmed coronavirus cases and you have been adamant as a physician about the importance of protecting Guatemalan lives. The first question is: which factors have been the key factors in establishing the national quarantine and other coronavirus fighting mechanisms, including the nationwide lockdown over the past weekend?

PRESIDENT GIAMMATTEI: Thank you very much. First Ana Palacio, thank you. Thank you very much for sharing the story about how we met. It was not you was impressed after that meeting; I was also impressed.

It was Day 49 into my administration when the first case of coronavirus appeared. At only 49 days, the administration was barely settled, and the first case appeared. Ana just said that I am full of energy, but I feel that little remains now. Throughout the 128 days we have been in office, 49 without coronavirus, we managed to recover and to revitalize certain economic areas. Criminality has diminished, extortions have gone down, and we have begun fighting corruption in certain sectors. There has been major impact through those efforts, and we were working on that when the coronavirus appeared. 

The first measure was taken on February 3rd – not on March 3rd – when the WHO declared that seven countries in the Americas had confirmed cases. We saw what was happening in China and Korea, and we asked the airlines to stop flying. We did not want any cases in Guatemala. Nonetheless, the first case appeared on March 3rd. Although by then, we had already started with our three-phase protocol. Phase 1 aimed for prevention. The protocols were initially only focused on two phases – prevention and mitigation – but we added an intermediate phase and we called it containment. So, it was not only preventing the entrance of the virus, which we were already doing, but we also wanted to contain it. We knew that we were going to get hit hard because our healthcare system had been fully neglected for 40 to 50 years. We had only 0.6 beds per 1000 inhabitants. We had a very low number of respirators, most of which did not work, and we knew that the acute phase of the disease requires respiratory assistance. As of today, we have rebuilt four hospitals. We are working on the 5th hospital, and we are also analyzing how to start building the 6th hospital. So, we are providing coverage for most of the population.

Other countries were telling patients, “you just tested positive, go back home,” and when they went back home they infected everybody else in the household. We did not do that. We did it the other way around. We knew that we had few hospitals and that the containment phase had to be aggressive. So, everyone that tested positive for coronavirus, we sent them to the hospital. However, the Social Security system of Guatemala did not abide by our protocol. They sent everybody back home, and that is why the disease has increased over the last weeks. Right now, it is compulsory for all institutions that whenever there is a positive case they should go to a hospital. Why? Because that way we will reduce contact. When you tell patients to go back home and isolate themselves, perhaps its feasible to do that in the first world countries where everybody has their own room, but in Guatemala 60-70% of the population lives in poverty with only one or two rooms for the whole family. So, you cannot self-isolate at home. We have opened the second hotel with health care services, in order to avoid infected people going back home. We are establishing a conservative protocol, but will release around 80 to 100 coronavirus patients in the days to come. We took a while to release our patients because we want to be sure they are really cured and will not relapse or contaminate anyone else. Some countries are seeing 40% reinfection rates. Our lethality rate is below 2%. Yesterday in the Parque de la Industria hospital, where we have great intensive care units with 48 beds, there are only 8 patients. None of them are at risk of death, but they did require assisted ventilation. We managed this crisis with treatments. Five weeks ago, we started giving anticoagulants to patients. Although patients may be asymptomatic or have light symptoms, if they test positive we are giving them not only paracetamol or acetaminophens, but we will also give them 100 grams of aspirin on a daily basis to prevent contamination. There are thrombus that go into the lungs and micro-thrombi generate the problems that end up with patient spots.

MR. MARCZAK: Thank you, thank you very much Mr. President. I believe the lessons we can learn from Guatemala and the steps you have taken are significant. We could share this information with other countries because you have a dedicated plan. I would like to ask you about the reactivation of the economy in the month of March. In terms of economic reactivation can you share your plan to balance the recovery and reactivation of the economy while the public crisis continues, remittances from the United States have lowered due to the virus, and the Guatemalan budget is altogether reduced? I would like you to share your plans and to share your vision for the future around changes in the supply chain. What can you tell us about the Guatemalan economy’s reactivation? 

PRESIDENT GIAMMATTEI: We have already established reopening protocols for all different sectors. From the spiritual aspects, the churches, to soccer. I would like to emphasize the fact that all protocols are different because you cannot have the same protocol for trade as for construction. And within industry itself, there are distinct classifications. We are ready to disclose our protocols because if I ever go to a shopping mall, I need to clearly understand both my rights and obligations inside that mall. The retail sector also must be acquainted with their rights and obligations. You know, Jason, I must emphasize that we will have to get used to this disease. It is like the Monaco F1 Race – in Formula One you need two things: how to step on the gas and how to step on the break. Why am I setting up this analogy with the disease? If we open a given activity, and the disease spikes, we need a protocol to address that specific spike and to try to flatten the curve. It is unlikely that cases will not go up, because if you open public transportation of course we will have more cases. So, we need to open the economy up with protocols, with restrictions, with a detailed plan. We need to know if the disease is peaking, so we can step on the gas to reactivate the economy. We must close the country in clusters — shut down a neighborhood, a municipality, a state, or province, in phase without closing the rest of the country. But in order to do that, first the population must be aware of the risks. A few months ago, nobody in the country believed the severity of the disease. Guatemala is one of the few countries where masks are obligatory. Korea was a model as one of the first countries in the world where masks became mandatory. Everybody followed it after that, and the WHO established that masks were mandatory. Then, everybody who had thought that I was exaggerating realized that I was right. For the next two or three years, everyone must get used to wearing a mask. 

Additionally, we need to give wings to the private sector. The first thing we will reopening in Guatemala is the construction sector. When? Perhaps in a week or two. Why? Because within the broad range of economic activities, the construction sector most easily enables social isolation, with one individual over there working on the books and you have somebody else working on the wires. There are no groups of people all together. There is social isolation inside the construction sector. We sent a bill to Congress to approve our request for a one-billion-dollar loan to rebuild the economy. Part of that will be construction of government buildings. We the government have to rent most of the facilities we use, and that is one of the most corrupt businesses in the country. So, we just filed for this loan because we want to buy the facilities. If we do that, we are generating 300,000 or 350,000 new employment opportunities, thus reducing rental expenditures and increasing production.

MR. MARCZAK: Mr. President, I have two more questions. I would like to clearly understand your plans to fight corruption so I would like you to share your administrations plan to fight corruption. Later, I have a final question about the United States.

PRESIDENT GIAMMATTEI: The government’s technological capacity is increased because we need technology to reduce opportunities for discretion. We have given 6 billion in quetzals to 2 million families. We are giving them 1500 quetzals to these families to pay for electricity, water, other necessities. There is also a subsidy for energy consumption. We are not selecting these families, as the subsidy applies to those who consume less than 200 kWh. For those without electricity, about 9% of the population, they are receiving a food directly at home. People in these programs can take their utilities bill and their personal ID and make a withdrawal from an ATM or the bank. It is not a partisan affair – we are addressing everybody. Everybody is part of this program. There’s full coverage. This is something no one has ever done. We have created social programs to assist the most vulnerable populations without human intervention, therefore reducing public officials’ ability for discretion. That is significantly reducing corruption. We are also increasing inclusivity, by implementing these programs in small villages and small towns. We do not want human beings involved so we are creating automated systems. In some occasions that is how you must act.

MR. MARCZAK: Mr. President, I have another question about the United States. The United States is a major Guatemalan ally and I have two questions. Number 1: what role may the United States play amidst the crisis? Number 2: many migrants have been deported back to Guatemala from the US, and some of them have tested positive. So, could you speak about the role of the United States, and the future of migratory cooperation?

PRESIDENT GIAMMATTEI: Allies? The United States? That is not true. I believe that Guatemala is an ally to the United States, but I do not believe that the United States is an ally to Guatemala because they do not treat us as such. We have seen how the United States has assisted other countries, with respirators, for instance, and we have not even gotten a single peso. We are allies today with the United States, but I do not think it is reciprocal. I do not think that it is a two-way road. We do not appreciate how we have been treated. We have had serious issues with deported individuals. I’m not going to delve into the details because I believe that it would be anti-diplomatic if we shared the details right now, but I can say adamantly that we have not been treated with goodness by the United States. It is a crisis. We do understand that the United States wants to have less people in their nation, but why are they only sending the infected patients? Because we now have to treat a disease that was not created here, kand our hospitals, which are limited, are now having to deal with these patients. We do not have enough room for quarantine patients, so if there were 75 deportees, just three who are positive fully disseminates the disease. We have such a large number of patients in our hospitals right now, and we have not even received one single mask from the United States – except the ones the deportees carry with them when they come back. We do consider ourselves and we behave as allies to the United States, but we would like reciprocity. There are problems but you are sending them with a disease, so let us share that part of the problem. We would also like to tighten our relationship with the United States because there are protocols. The CDC delegates in Guatemala drafted the protocols with the US and there has been full compliance on our side but not on the other side.

MR. MARCZAK: Thank you very much, Mr. President, for that question. I have a question from Edgar Villanueva from the US Guatemala Business Council. The question is, if you can share, has the Guatemalan government already started plans to attract further US investment to Guatemala? If the answer to that question is yes, how can you guarantee stability to foreign investment at the time being?

PRESIDENT GIAMMATTEI: Thank you very much Jason. There is a one stop shop for imports and exports to reduce red tape and to facilitate trade. It is a one stop shop, and everything is handled there. We already started construction on the refurbishing plans of the San Jose airport. It is the first cargo airport in the region, and in addition to having a military base, it will hold a duty-free area and a space to process merchandise for the port. It will be both a one stop shop and an airport at the same place. This will give us a competitive advantage. Additional efforts are required, that is why we are in communication with the United States, because we would like to have US customs delegates in Guatemala to clear exports, passing sanitary controls and safety controls, as they leave the country. I think it would enable commerce. It would indeed be a novelty, and we will be able to draw further American investment. We are currently exploring the southern coastline where we hope reactivate the Champerico port. We want the Champerico port reactivated with a multi-node development in the southern coast of Guatemala, where we can have airports, trains, duty free areas, all in one to further boost investment. We believe that Guatemala is inviting US companies. They left to china and we want them back because it is cheaper here, and closer. We are proposing to work jointly with the United States to construct a gas line from the Atlantic to the Pacific. This will avoid the necessity for ships to travel 28 days through the Magellan Straight. It would be great to work alongside the United States. In addition, we encourage collaboration not only with Guatemala, but with Central America. Central America is an extremely important region, with over 15 million people. We have a canal, we could also have a gas line, and there is lots of opportunity for collaboration here. If there was true integration, if we really became one solid economic bloc, that would attract investment, facilitate transit and taxes just like the European Union. If we collaborate borders and customs and inspections, we would be able to further exploit natural resources and the marvelous labor force available in Central America. We are very close to the United States, only two hours and twenty minutes away from Miami.

MR. MARCZAK: I look forward to when I can return to Guatemala, it is only a two-hour flight. Thank you, sir, for your time on behalf of the Atlantic Council. Thank you to our founder Adrienne Arsht, who has been part of this very important discussion, and because of whom we are here today. Mr. President, allow me to convey our solidarity from the Adrienne Arsht Latin America Center. We feel that economic prosperity is crucial in Guatemala, and in all Central America, and you definitely continue having our support. Once again thank you very much Mr. President for your time. We shall continue being in touch.