GUATEMALA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00826A003200110001-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 13
• Document Creation Date: December 12, 2016
• Document Release Date: January 2, 2002
• Sequence Number: 1
• Publication Date: August 1, 1966
• Content Type: CH

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SECRET/NO FOREIGN DISSEM
August 1966
OCI No. 1889/66
Cope N2 412
Current Intelligence Country Handbook
GUATEMALA
This revision supersedes the handbook dated September 1965,
copies of which should be destroyed.
DIRECTORATE OF INTELLIGENCE
SECRET/NO FOREIGN DISSEM
GROUP 1
Eac ud.d Irow ovlowaria
dow..g,oding and
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Current Intelligence Country Handbooks are desigyled to give the
reader ready access to the salient facts about a country and its main
current problems. They are not intended to provide comprehensive
basic intelligence on a country or to speak with the authority of
coordinated national intelligence. The information presented is the
best available to the Office of Current Intelligence as of the date at
the top of the page.
This material contains information affecting the national defense
of the United States within the meaning of the Espionage Laws,
Title 18, USC, Secs. 793 and 794, the transmission or revelation of
which in any manner to an unauthorized person is prohibited by law.
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August 1966 SECRET/NO FOREIGN DISSEM
GUATEMALA
1. Political
Return to a constitutionally elected government was achieved on
1 July 1966 with the inauguration of Julio Cesar Mendez Montenegro
as president. As promised by the outgoing Peralta regime, national
elections were held on 6 March; people were apathetic and the nation
was calm during the election. During the contest, Mendez, the candi-
date and the leader of the moderate leftist Revolutionary Party (PR),
polled 201,077 votes against 146, 085 for Juan de Dios Aguilar de Leon,
the candidate of the military government-backed Institutional Demo-
cratic Party (PID). The National Liberation Movement's (MLN)
Miguel Angel Ponciano Samayoa polled 110,145 votes.
Even though Mendez did not receive a strong popular mandate,
his party was able to win 30 seats in the Congress to 20 for the PID
and 5 for the MLN. Mendez has the initial advantage of having
assumed power with few political enemies. However, his inexperi-
ence will add to his difficulties as he tries to cope with Guatemala's
plethora of problems. The PR majority in Congress is not entirely
united, thus Mendez will need to make effective use of patronage
and pressure. As he attempts to govern and reform Guatemala, the
military and other conservative forces in Guatemala will be watching
Mendez carefully for an excuse to oust him from office. Military
plotting, endemic in. Guatemala, is expected to continue throughout
Mendez's term and may well shorten it.
2. Economic
The Guatemalan economy is slowing down from the rapid rates
of growth registered during 1963-65. GNP during 1966 has been
expanding at an estimated annual rate of 5 percent as compared with
the 1963-65 average annual rate of more than 8 percent. Factors
restraining the economy are reduced rates of private and public in-
vestment, slower expansion of exports, and increasingly tight credit
as monetary authorities attempt to correct a growing trade deficit and
strengthen the country's foreign exchange reserves.
The decline in private investment has resulted from a downturn in
businessmen's confidence in the economy's prospects. World market
prices for coffee and cotton, Guatemala's principal exports, have been
weakening since early 1965 because of over-supply. The prospect
SECRET/NO FOREIGN DISSEM I
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SECRET/NO FOREIGN DISSEM August 1966
of lower growth rates in export earnings together with the tightening
d
cre
it situation and continuing doubts about political stability have
led many entrepreneurs to cut back outlays in new or expanded
productive facilities.
Government investments remain low-since the late 1950s it has
rarely exceeded 3 percent of GNP-and is unlikely to expand sig-
nificantly. Despite plans to expand capital spending on economic and
social improvements, the Guatemalan Government has neither the
domestic funds nor the administrative ability to qualify for sub-
stantially higher levels of external economic assistance than it is now
receiving. The tax system is inefficient and highly regressive-direct
taxes yield less than one sixth of total revenues-and to increase its
domestic investment resources the government would have to institute
fiscal reforms that would probably generate overwhelming political
opposition from powerful economic interests.
Basic to the economy's lack of dynamism are the deep-rooted con-
ditions of inadequate skilled labor, extensive under-employment, illit-
eracy, and social and economic immobility. With half the popula-
tion-the Indians-living outside the money economy in subsistence
agriculture, and the bulk of the other half in only slightly better con-
ditions as rural peasants or urban poor, there is little impetus from
within the economy to stimulate rapid and sustained growth.
3. International Relations
Guatemala's foreign policy reflects its traditional close relationships
with neighboring Central American republics, economic ties with the
United States, and anti-Communist attitude. Its claim to British
Honduras (Belize) has beera perennial foreign policy problem. Talks
between Guatemala, Britain and British Honduras are being carried
on at present under the auspices of a United States mediator and a
solution may he in sight. The UK and Guatemala have agreed to
renew diplomatic relations-which were broken in 1963 over the Belize
issue-but a date for resumption has not yet been set.
It is expected that the new government will collaborate even more
closely with the United States than its predecessor. Guatemala has
been friendly toward and cooperative with the United States in both
the OAS and the UN. Guatemala's consistent support of the West on
international issues is expected to continue.
Guatemala has been a leader of the movement toward Central
American integration and is the first Central American country to have
ratified all agreements on economic integration.
SECRET/NO FOREIGN DISSEM
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August 1966 SECRET/NO FOREIGN DISSEM
4. Subversion
At present Guatemala is faced with subversion from the right as well
as the left. Recently at least two rightist action groups have been
formed, at least one of them by the right-wing National Liberation
Movement (MLN). The main subversive thrust which the country
faces, however, comes from the Communist Guatemala Labor Party
(PGT) and its action arm the Rebel Armed Forces (FAR). Be-
lieved to be the best organized and most flexible group, the FAR
has been carrying out guerrilla activity in the countryside and urban
terrorism in Guatemala City. Another group, the 13 November Revo-
lutionary Movement (MR13N), continues active but the extent of its
involvement is unknown. Cuban support for the revolutionary move-
ment has been transferred from the MR13N to the FAR. During the
Tri-Continent Conference in Havana in January 1966, Fidel Castro
singled out FAR leader Luis Turcios Lima as the leader of the true
revolutionary movement in Guatemala. In addition Guatemala is one
of the three Latin American countries upon which Havana is focusing
its subversive effort and ranks among the top three in the number
of guerrilla agents who have received training in Cuba. Guatemala
was one of the seven countries listed as priority subversion targets in
the communique of the November 1964 meeting of Latin. American
Communist Parties.
The illegal PGT has about 1,200 members and an estimated 3-4,000
sympathizers. Although the party is subject to continual damage by
effective government raids, it maintains itself through its well trained
leadership and hard core of disciplined members who have been able
to reorganize and resume activities. It is possible that under the
Mendez government the party will be able to increase its numbers.
Since non-Communist leftist dissidents believe that the Mendez gov-
ernment will not be any different from its predecessor, they may move
into the Communist orbit in an effort to change the situation.
The security forces, which total over 4,000 men, arc capable of
containing limited threats to public order but would be incapable of
maintaining order against sustained large-scale guerrilla action. Since
the beginning of 1966 they have rounded up a substantial number of
Communists and have been more successful in their anti-subversive
efforts. Assistance from the US AID public safety mission has some-
what improved the capability and efficiency of the security forces.
The sporadic hit-and-run tactics of guerrillas and urban terrorists,
however, present a continuing security problem. The effectiveness
of civil police forces is hampered by the low caliber and, morale of
personnel and by poor training.
SECRET/NO FOREIGN DISSEM Guatemala - 3
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SECRET/NO FOREIGN DISSEM August 1966
Chronology of Key Events
1945 (March 15) Juan Jose Arevalo inaugurated as Guatemala's
first freely elected president.
1949 (18 July) Assassination of Col. Arana, chief of armed forces,
provokes unsuccessful rebellion of his army supporters.
1950 (12 November) Col. Jacobo Arbenz, elected president; inau-
gurated 15 March 1951, resigned 27 June 1954.
1951 (October) Unified, Communist dominated General Confed-
eration of Guatemalan Workers is orgai,ized.
1952 (June) Agrarian Reform Law enacted with strong Com-
munist backing.
(December) At second congress, Communist Party changes
name to Guatemalan Labor Party (PGT) and is officially
registered as a legal party.
1953 (February-August) Guatemala expropriates large areas of
United Fruit Co. plantations.
1954 (15 May) 2,000 tons of weapons arrive in Guatemala from
Soviet bloc.
(18 June) Anti-Communist "Liberation Army," of about 200
men led by Col. Carlos Castillo Arenas, invades Guatemala;
Arbenz ousted; PCT and Communist fronts outlawed.
(6 November) Castillo inaugurated for a term to last until
March 1960.
1956 (1 March) Constitutional government is restored with instal-
lation of congress and promulgation of ni'w constitution.
1957 (26 July) President Castillo Arenas assassinated; Luis Arturo
Gonzalez succeeds to presidency.
(26 October) Mob action forces Gonzalez to resign; Military
junta takes over; mobs force junta out; Congress names
second presidential designate, Guillermo Flores Avendano
as interim president and annuls October elections.
1958 (19 January) Miguel Ydigoras Fuentes wins plurality in na-
tional elections; inaugurated on 2 March 1958.
1959 (December) Guatemala accuses Cuba beforr OAS of help-
ing Communist prepare an invasion of Guatemala.
1960 (April) Guatemala severs diplomatic relations with Cuba.
1963 (25 March) Government declares state of siege following
a wave of terrorism; the return of Juan Joe Arevalo pre-
cipitates a military coup on 30 March; Col. Enrique Peralta
heads provisional military government.
(May-June) Guerrilla and terrorist activity breaks out
against regime.
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August 1966 SECRET/NO FOREIGN DISSEM
1963 (24 July) Peralta government breaks relations with the UK
over the Belize issue.
1964 (30 March) State of siege lifted and constituent assembly
elections are convoked for May.
(24 May) Constituent Assemblymen elected and charged
with writing a new constitution and complementary laws.
(8-10 December) Government captures a number of ter-
rorists and their equipment and propaganda; urban ter-
rorism continues.
1965 (30-31 January) Members of the rightist National Reformist
Movement (MRN) arrested for alleged plotting against the
government.
(24 February) State of siege reimposed following urban ter-
rorist attacks. Numerous leftists exiled.
(1-3 March) Victor Manuel Gutierrez and approximately 27
other Communists arrested by security forces. Gutierrez
and approximately half of the remainder have been killed.
Nothing known of the others.
1966 (6 March) National elections take place; electorate apathetic;
calm reigns throughout the nation.
(1 July) Julio Cesar Mendez Montenegro and Clemente Ma-
rroquin Rojas inaugurated as president and vice-president,
respectively.
Holidays and Significant Dates'
1 January - New Year's Day
Mar-Jun - Movable religious observances:
Thursday, Friday and Saturday of Holy Week
1 May-Labor Day
30 June - Army Day
15 September - Independence Day
12 October - Discovery of America
1 November - All Saint's Day
24 December - Christmas Eve (half day)
25 December - Christmas
LAND (U)
42,000 sq. mi.; 10% cultivated, 7% fallow, 5% meadows, 16%
waste, urban, or other, 62% forested (1950)
? Does not include numerous religious holidays which, although not official,
are observed by the majority of the population.
SECRET/NO FOREIGN DISSEM Guatemala - 5
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PEOPLE (U)
Population: 4.5 million; males 15-49, 1,002,000; 510,000 fit for mili
tary service; about 40,000 reach military age (18) annually
Ethnic Divisions: 54% Indian, 46% Ladino (non-Indian)
Religion: predominantly Roman Catholic
Language: Spanish, but over 40% of the popular ion speaks an
Indian language as a primary tongue
Literacy: about 20'%%:
Labor force: 1.5 million (1965); 68 %7% agriculture, 12"e manufactur-
ing, 18% other; 2% unemployed; severe shortage df skilled labor;
oversupply of unskilled labor
Organized labor: 2% of labor force
GOVERNMENT (Secret)
Capital: Guatemala City
Regional breakdown: 22 departments
Type: unitary republic
Branches: Traditionally dominant executive; elected unicameral
legislature; 5-member supreme court
Government leader: President Julio Cesar Mendez Montenegro
Suffrage: Voting is obligatory for all literate citizens 18 years or
older. It is optional for illiterate persons.
Significant exclusions from voting: Members of the armed forces on
active duty, the police and those who are mentally disabled
Registered voters as percent of the population in 1966: 21.0%,
(937,470)
Abstention (1966): 417,174 (44.5% of registered vot( rs)
Extent of fraud: Apparently very little in vote count
System of balloting: Presidential and vice-presidential candidates
of the same party are paired. Separate ballots are used for the
different offices.
Election laws on the whole encourage the multi-party system
Next National election March 1970
Political parties and leaders: Democratic Institutional Party (PID),
Hector Menendez de la Riva; Revolutionary Party (PR), Julio
Cesar Mendez Montenegro; National Liberation Movement
(MLN), Mario Sandoval Alarcon
Voting strength: for president-PR 201,077 (44% PID 146,085
(32%), MLN 110,145 (24'0); for congressional seats-PR 30, PID
20, MLN 5
Communists: 1,200; sympathizers 3-4,000
Other political or pressure groups: Guatemalan Christian Demo-
cratic Party (DCG), Rene de Leon Schlotter; outlawed (Commu-
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August 1966 SECRET/NO FOREIGN DISSEM
nist) Guatemalan Labor Party (PGT), Bernardo Alvarado (in
exile); Guatemalan Social Party (PSG), Jorge Lucas Caballeros;
National Reformist Movement (MNR), Jose Luis Cruz Salazar
Member of: UN OAS, CACM
ECONOMY (U)
GNP: (est. 1965) $1.4 billion, an increase of 7% over 1964; $318
per capita
Rate of inflation: negligible
Agriculture: coffee, cotton, bananas; imports some beef, wheat, fats,
and dairy products
Major industries: foodstuffs, textiles, footwear, beverages, handi-
crafts
Electric power: 100,000 kw installed capacity (1964); 599 million
kw-hr produced (1963) ; 146 kw-hr per capita
Exports 1965: $185.9 million FOB: coffee, 50%; cotton, 19%; ba-
nanas, 1%; (others no change)
Imports 1965: $240 million CIF (est.): (no change in items)
Imports from US 1964: $89.8 million CIF (457 of total)
Exports to US 1964: $82.8 million FOB (48% of total)
Trade/aid: 1965 trade imbalance of $30 million (FOB basis) largest
since 1958; $5.9 million in AID assistance in 1964
Trade: exports and imports-all to non-Communist countries
Aid: economic aid extensions (FY 1946-65) from US and inter-
national organizations-loans US$84.5 million;-grants US$143.4
million
Exchange rate: 1 quetzal = US$1 (official)
Fiscal year: Jan.-Dec.
COMMUNICATIONS (Confidential)
Railroads: 572 mi., all narrow gage; 95% privately owned
Highways: 7,575 mi.; 930 mi. paved, 5,075 mi. otherwise improved,
1,570 mi. unimproved
Freight carried: rail (1960)-191.8 million ton/miles, 1.1 million tons
Ports: 2 principal (Puerto Barrios, Matias de Calvez), 2 secondary,
1 minor
Merchant marine: 2 ships (1,000 GRT or over) totaling 3,629 GRT,
5,400 DWT; includes 2 cargo
Airfields: 352 total, 292 usable; 3 with permanent-surface runways;
1 with runway 8,000-11,999 ft.; 14 with runways 4,000-7,999 ft.;
1 seaplane station
Civil air: 11 major transport aircraft
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Telecommunications: fairly modern in Guatemala City but outside
are inadequate; excellent international radio communications;
country-wide radio broadcast; 20,000 telephones
DEFENSE FORCES (Secret)
Personnel: army 8,620, navy 140, air force 93
Major ground units: 380-man Presidential Guard, 4 brigades, 4 bat-
talions, 1 airborne company
Ships: 1 patrol escort, 4 patrol craft, 1 floating workshop, 1 aircraft
reserve vessel
Aircraft: 40 (8 jet, 30 prop, 2 helicopter)
Supply: dependent primarily on US, some Polish equipment
Military budget: for fiscal year ending 31 Dec. 1965, $14,338,000;
about 9%0 of proposed total budget
US missions: army, air
US military aid: $2.4 million in FY 1963; $7 million total between
1955-63
Percentage of national budget: 8.4,%o
RELATIONS WITH COMMUNIST COUNTRIES (U)
None
National Intelligence Survey (NIS) Material
The following sections of the NIS are relevant:
NIS Area 71 (Guatemala)
GENERAL SURVEY (Aug (35) and the following specialized sec-
tions:
Sec 20 Introduction-Military Geography Apr 58
Sec 21 Military Geographic Regions Feb 58
Sec 23 Weather and Climate May 57
Sec 24 Topography Oct 57
Sec 25 Urban Areas May 57
Sec 31 Railway Jan 59
Sec 35 Ports and Naval Facilities Apr 56
Sec 37 Civil Air Jun 60
Sec 38 Telecommunications Sep 58
Sec 41 Population Apr 53
Sec 42 Characteristics of the People Feb 54
Sec 43 Religion, Education, and Public Information Jan 53
Sec 44 Manpower Apr 61
Sec 45 Health and Sanitation Mar 61
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August 1966
Sec 51
Sec 52
Sec 53
Sec 54
Sec 57
Sec 58
Sec 61
Sec 62
Sec 63
Sec 64
Sec 65
The Constitutional System Jun 58
Structure of the Government Sep 59
Political Dynamics Mar 59
Public Order and Safety Feb 60
Subversion Jan 66
Propaganda May 57
Agriculture, Fisheries, and Forestry Jul 57
Fuels and Power Jul 57
Minerals and Metals Jun 56
Manufacturing and Construction Jan 56
Trade and Finance Jun 55
Sec 91-94 Map and Chart Appraisal Aug 56
Gazetter Oct 65
Map
The best available general reference map is: Texaco; Guatemala;
1:1,175,000; 1964
SECRET/NO FOREIGN DISSEM Guatemala - 9
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INDEX TO
DEPARTAMEN TO NAMES
1. EL PETER
2. HUEH
3. SA UETENANGO
N MARCS
4. TOTONICAPAON
5. QUEZA LTENANGO
6. RETALHULEU
ICHE
7. ESOLOL QULA
B.
9 El
10. CHIMALTPEENQNGO
11. SACATEPESUEZ
12. ESCUINTLA
13. ALTA VERAPAZ
14. BAJA VERAPAZ
15. GUATEMALA
16. SANTA ROSA
17. EL PROGRESO
18. JALAPA
19. JUTIAPA
20. IZABAL
21. ZACAPA
22. CHIQUIMULA
San Marcos
Huehuet'e nc_ I
Santa Cruz, Solar'
4 del Quic6 14
Tot r1k~pA"- - c 17
alt nango
Btepeg1
/ 10 l
x . Chimia'
311 5u,"' PO
Eu- 21
Zaca P.
I Cayo \--
Middlesex
BRITISH
HONDURAS
GUATEMALA
??~ International boundary
-?i Departamento boundary
National capital
p. Departamenlo capital
- Railroad
Inter American Highway
Other road
0 10 25 50 Miles
I lyt---~-r
0 10 25 50 Kilometers
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