Why starting a business in Guatemala is a bad idea.

The customer picked me up this morning at 8am. Traffic was light and we arrived early at the classroom. The customer's building has three floors - they are on top, a call center in the middle, and common rooms (cafeteria, classrooms, etc) on the bottom. We stopped at the cafeteria and had a cup of coffee until 9am, as the classroom was busy while my host told me a little about this building.


It is close to the university which means that many of the graduates come to work at the call center. They hone their language skills, learn technical skills, and then my customer (a large bank) hires some of them. This is why everyone here was young, and the female / male ratio is about 3:2. An oasis of well-dressed hopeful youth among the run-down streets of the city. 


But the real question is: How is the coffee? Guatemala is known for excellent coffee, but they don't serve it in this cafeteria (the Guatemalan-labeled coffee in my room was very very weak, so tomorrow I will have double up). As our class participants checked in (they got stuck in traffic) we learned they were from Costa Rica. We were supposed to have 16 participants from El Salvador and Nicaragua too, but they were unable to get their flights in order in time and had to cancel, so we had a class of only eight. Perfect.


I taught. Language is an issue, but the young Ricky Martin look-a-like from Costa Rica had excellent english skills and was able to translate when needed.


Lunch came up, and we found some "authentic" Guatemalan food. It is best described as very similar to mexican, but not spicy and with less sauce. I had an excellent shredded pollo des rey, marinated in tomato/salsa paste with a 1/4 cheese quesadilla on the side ... and some sort of black bean concoction. 


During lunch our Costa Rica'n students discussed differences they saw between their own country and Guatemala, for example how cold it was here. Cold? It was 70, dry and awesome! They were surprised when I told them it was supposed to hit the 90's back in Minnesota. 


Anyway, one topic that came up was security, specifically how everyone is corrupt. Nobody wants to start a business because of the "protection racket" just like we experienced in the US 90 years ago with the mafia. The crooks would use public information to find out where the business owners friends and family lived then require a monthly 'fee' to ensure they remained safe. Our hosts pointed out that the only safe job to have is in the government, but the government jobs only go to the friends and family of those already in government or willing to pay to get those jobs. 


Afterwards the discussion turned to the drug wars and news articles about last week's six-hour shootout between truckloads of military personnel and a drug gang. The military lost. Our host explained that Guatemala, like many central american countries, are stuck between Mexico and Columbia and therefore become a conduit for drug trafficking. The government spends much of its resources fighting these gangs even as the gangs fight each other, especially on the borders. I can't help but think the root cause lies at the intersection of the United State's hunger for drugs and having the relative wealth to buy them.


I was listening to a podcast about these gangs. The drug industry has profits in the hundreds of billions. They maintain fleets of planes which they fly to Africa and leave there ... imagine disposable DC-9's. They purchase weapons from the Russian mafia. Their profits are larger than the GDP of all the central american countries .... combined. The central american governments simply cannot compete with the drug gangs.


Allow me two tangents: guns and drugs.


Most of the guns seized in Mexico come from their military or the Russian mafia. These weapons (sub-machine guns, rocket launchers) are not legally sold in the us. A fully automatic AK-47 costs $50 on the black market, while the semi-auto version (legal for sale in the US) costs $200. Why in the world would a drug gang buy these in ones and twos from dealers in the US when they can purchase the much more potent and less expensive ones by the planeload on the black market? You may recall Obama's statement last year that 90% of guns seized in Mexico were traced to the US ... but his statement was false. Recently news that the ATF is allowing some weapons to cross into Mexico in attempt to trace them has resulted in the death of a border patrol agent. Furthermore, the lists of individuals who have purchased guns from US retailers have been shared with more than 100 agencies south of the border. It would be naive to think that the gangs did not get their hands on these lists ... thankfully we continue to be successful in destroying firearms registration records after six months despite our elected politician's desire to keep them. There's no denying that the gangs have easy access to firearms, but at this point there isn't much evidence that the bulk of them come from the US.


A word about drugs. Those of you who know me, know that I feel responsible adults should be allowed to make their own decisions regarding drug use. The focus of this debate has been in the realm of liberty vs. effects on your health. Yet this trip to central america has unveiled a new aspect to the debate. When illegal drugs are purchased the gangs are funded. It robs entire countries of their ability to function without corruption, crime, and personal safety. It funds an industry that promotes violence and coercion. Do all drugs come from Mexico and Columbia, via central america? Probably most of the cocaine does. I'm sure it is a conduit for heroin and opium too. What about marijuana ... ? Isn't all of that grown in Canada? Maybe .... but does that mean that Canada does not have drug traffickers who also use violence and coercion to promote their trade? Would legalizing controlled substances result in less violence? Maybe .. it seems that way in California when looking at the medical marijuana dispensaries. But nobody is talking about legalizing anything more than marijuana.


Ok ... that should be enough to think about. Back to Gautemala.


It is no wonder than Guatemalans are also seeking to illegally enter the US, as they have no real prospects to better their lives in their own country without bribes or "knowing someone". Hard work is not sufficient in this environment.


Then back to work and I taught some more. The boring parts.


The drive home had it's excitement as well. Our driver was following a crappy white cargo van too slowly. When the van stopped abruptly we hit it. Fortunately there was a police officer right next to us, apparently not directing traffic, and we didn't hit the van hard at more than 5 mph as we were in stop'n'go traffic. Interestingly the police said our driver had to fix it "like new". Huh? It's a 20 year rusted and dented van !! Looking around, nearly every car was damaged in some way. The Pontiac sunbird we were in was a claptrap, missing seatbelts and the radio was stolen (but it ran OK). I guess that's how things are done here.


Back the hotel I enjoyed the local sushi bar. Some edamamie and a smoked salmon fusion roll hit the spot, flushed down with a bottle of Asahi. 


Nothing more to report for today.

Getting here

Getting to Quatemala City was very easy, other than having to take an early flight (5am) from Minneapolis to Atlanta, then from ATL to Guatemala City. Since I fly often I was upgraded to first class on both flights.


Mindful of the warnings regarding tourists who are robbed shortly after visting ATM's I decided use the foreign currency exchange in Atlanta despite the high fees and bad exchange rates. In exchange for $200 I got 1200'ish GTQ's (Quetzals) ... mostly in crisp 10-GTQ bills. Crap. This amounted to an unfolded stack of crisp bills about one inch thick. I put a few in my pocket and jammed the rest into the bowels of my suitcase.


As we flew over the Guatemalan coast I got a chance to see the famous beaches (probably Belize ... disputed territory) and the interior of the country. What can I say .. I like rugged mountains, and there were many of them, as far as the eye could see, some volcanoes, I'm guessing. This continued all the way to Guatemala City ... which is also nestled in the mountains. 


At the very modern (but small) airport I breezed through security and met Angela (GBM sales rep) holding a sign with my name on it. After a quick exchange of names and where I was going I "authenticated" her (one kidnapping trick is to copy the name on a sign someone else is holding). It was a quick ride to the hotel, and from what I can see, Guatemala City is just like Mexico City, just a lot smaller.


An interesting observation is that there are many scooters here, nearly all wear helmets and large numbers on their helmets and jackets. Angela tells me that it the law that a) no passengers are allowed, b) helmets are required and c) they must have their registration on the back of their jacket or helmet. This law exists in response to robberies performed by motorcyclists in heavy traffic, where the passenger often targets tourists who display cameras or phones, grab them, and proceed to scoot through stopped traffic. However, there are still several cyclists who don't wear helmets, have passengers, and don't wear numbers on them. When I asked Angela about that ... she said that the police don't care. Hm.


When I got here, and asked the hotel concierge where I can find a SIM card for my travel phone, I was directed to a mall two blocks away. Since it was about noon they said it was safe, but to be back before 5-6pm and don't carry anything of value such as a camera or a phone. My response was to put money, credit cards and my passport card under the insoles of my shoes, and carry my American Express and a few bills in my pocket, sort of as a decoy should I be mugged. Things went well, even buying a SIM card from non-english-speaking folks. 


Usually when I arrive early to exotic locations I like to tour around, but today I was totally exhausted from only two hours of sleep and my work inbox was bulging. I took a nap, did some work, ate dinner in the french hotel restaurant (absolutely faaaaantastic roasted seabass with scallions and chirozo in a ginger/mustard sauce, with an awesomely dry/tannic Argentinian Malbec.

Guatemala

Going to Guatemala was put on my radar shortly after my trip to Mexico. The odd thing is it was originally supposed to be a trip to Costa Rica, but the company decided that my services (teaching) should be delivered in Gautemala and the participants will fly in from neighboring countries ... such as Costa Rica. I suspect this has something to do with work permits (which is the first thing I need to research when traveling overseas). 


The second thing I do before I travel to another country is to check both the state department's and IBM's websites for any information. IBM listed the country as "restricted" as there is no IBM presence there. The state department was more useful. For example:

Virulent rumors of child stealing and murder for organ harvesting continue to be reported in several different areas of Guatemala frequented by American tourists. Frustration over crime and a lack of appropriate judicial remedies have led to violent incidents of vigilantism.

I think I'd like to keep my organs, at least while I'm using them.

Crime itself is a problem too:

Guatemala has one of the highest violent crime rates in Latin America. In 2010, approximately 55 murders a week were reported in Guatemala City alone. While the vast majority of murders do not involve foreigners, the sheer volume of activity means that local officials, who are inexperienced and underpaid, are unable to cope with the problem. Rule of law is lacking as the judicial system is weak, overworked, and inefficient. Well-armed criminals know there is little chance they will be caught or punished.

The State Department continues:

The number of violent crimes reported by U.S. citizens and other foreigners has remained high and incidents have included, but are not limited to, assault, theft, armed robbery, carjacking, rape, kidnapping, and murder, even in areas once considered safe such as zones 10, 14, and 15 in the capital. To decrease the likelihood of becoming a victim, do not display items of value, such as laptops, IPods, cameras, and jewelry. The Embassy discourages carrying large sums of money. Do not resist if you are being robbed. Victims have been killed when they resisted attack. Assailants are often armed with guns and do not hesitate to use them if you resist.

 I am working and staying in Zone 10. Here's more info:

A number of travelers have experienced carjackings and armed robberies just after arriving on international flights, most frequently in the evening. In the most common scenario, tourists or business travelers who land at the airport after dark are held up by armed men as their vehicle departs the airport, but similar incidents have occurred at other times of the day. Private vehicles, taxis and shuttle buses have all been targeted. Typically, the assailants steal money, passports, and luggage, and in some but not all cases, the assailants steal the vehicle as well. Recently, many of these attacks have taken place far from the airport, just as travelers were arriving at their homes, or in less busy areas of the city. Victims who did not resist the attackers were not physically injured. If you need to get a taxi upon arrival (particularly in the evening) there is a “Safe Taxi”(“Taxi Seguro”) service from the airport which has been approved by the Guatemalan Tourist Institute (INGUAT). Look for the taxi queue at the airport exit. Coordinate arrival times with those picking up passengers, minimize time spent standing outside in the airport passenger pick-up area, and do not walk out of the airport with valuables in plain sight. Laptops are frequently targeted, so carry them inconspicuously in a backpack or other carry-on luggage. In some cases, assailants have been wearing full or partial police uniforms and have used vehicles that resemble police vehicles, indicating that some elements of the police might be involved. Armed robberies have occurred within minutes of a tourist’s vehicle having been stopped by the police.

Hm, so even the police can't be trusted. Nice. At least toilets have paper and it can be flushed.


So .. with these warnings in mind, and with the knowledge that I will not be there very long, I decided to leave my camera at home, so no [good] photos. I purchased a small laptop bag which I could put inside my suitcase so I wouldn't have to carry what is obviously a laptop-holding backpack (plus it fits in my motorcycle sidecase). 


But, never having been to Guatemala before, I still wanted to go!