Migration policies adopted under the Trump administration have created a sense of caution among Guatemalans in the United States, who fear being detained and deported. Many have been increasing their transfers home in anticipation of a possible forced return. Photo by gerald/Pixabay
Money sent home from abroad to Guatemala could see record growth in 2025, surpassing $24.5 billion, according to statistics from Guatemala’s central bank. The figure would represent a 14% increase compared with 2024.
Between January and September 2025, Guatemala received $18.97 billion in remittances, a 19.8% increase over the same period last year.
Guatemala is emerging as Central America’s most dynamic economy, with gross domestic product projected to grow from to 3.9% in 2025 from 3.7% in 2024. The World Bank says that expansion will be driven largely by money transfers from abroad.
Migration policies adopted under the Trump administration have created a sense of caution among Guatemalans in the United States, who fear being detained and deported. In that context, analysts say many have been increasing their transfers home in anticipation of a possible forced return.
According to a report by the International Organization for Migration, about 2.1 million Guatemalans send remittances — mostly from the United States — and those transfers reach roughly 1.7 million households, indirectly benefiting 6.5 million people.
Remittances account for nearly 20% of Guatemala’s GDP and are a key factor in macroeconomic stability and private consumption. According to the country’s central bank, 60% of those funds go toward basic goods and services, 30% toward housing and 10% toward social or educational projects.
In terms of production, although the country continues to export coffee and bananas, it has expanded its manufacturing sector over the past decade through nearshoring. The arrival of assembly and textile plants has increased exports by nearly 6% a year, supported by supply chains that extend to the U.S. southern border.
Another key factor is Guatemala’s prudent fiscal policy, which keeps the budget deficit around 1% of gross domestic product. Inflation remains under control at about 3%.
In its Economic Review for Latin America and the Caribbean for October, the World Bank said business lending grew more than 10% this year, while the benchmark interest rate remains low at 2.5%, encouraging medium- and long-term investment projects.
The report also highlights expanding exports and market diversification. It further notes the strength of public finances and the available fiscal space for infrastructure investment. It also aligns with sustained growth in domestic demand, supported by remittances and private consumption.
President Bernardo Arévalo said the progress “is no coincidence, but the result of the serious and sustained work of the economic team and the entire government — our commitment to transparency, community development and international cooperation.”
Still, structural challenges persist. Extreme poverty affects about 20% of the population, and inequality — especially in rural and indigenous areas — is narrowing only slowly.
The World Bank report cites high rates of chronic child malnutrition, low educational coverage and quality, and limited access to health services.
It adds that the economy remains constrained by low productivity, high informality and dependence on agriculture and other low-value-added sectors. Employment is largely informal, offering few opportunities for upward mobility and limited access to social protection.
