Guatemala: Economic growth softens on weak domestic demand
January 10, 2013
In the third quarter, GDP expanded 2.4% over the same period the previous year, which was below the 2.7% rise observed in the second quarter (previously reported: +2.5% year-on-year). The print marked, in fact, the lowest expansion rate since the third quarter of 2010.
The deterioration mainly reflected a slowdown in domestic demand, which grew a weak 1.2% (Q2 2012: +1.7% yoy). That said, total consumption improved in the third quarter on the back of stronger public spending (Q2: +0.6% yoy; Q3: +9.2% yoy), whereas private consumption moderated somewhat (Q2: +2.4% yoy; Q3: +2.0% yoy). Meanwhile, fixed investment slowed from a 5.7% rise in Q2 to a 3.9% expansion in the third quarter. However, total investment was dragged down by a sharp destocking process.
Meanwhile, the external sector improved markedly due to faster growth in exports of goods and services, which climbed 12.0% over the same period the year before (Q2: +2.6% yoy). On the other hand, imports fell 2.0% (Q2: -1.8% yoy). As a result, the external sector's net contribution to overall growth jumped from 1.4 points in the second quarter to 3.8 points in the third.