During the last two years I was the Undersecretary of Investment and Competition in Guatemala. My priority was to promote Guatemalan competitiveness via: a) the legislative and regulatory economic agenda; b) the implementation of anti-red tape legislation in the directions under my control. This was done as a response to two overarching guidelines: a) the Government´s Policy Framework; and b) the Government´s COVID-19 Economic Recovery Plan.
Promoting the legislative and regulatory economic agenda
The following legislative and regulatory economic agenda was successfully approved:
Leasing Act (Ley de Leasing). The legislation clarifies tax and judicial responsibilities of those involved in a leasing contract. The Ministry, after evaluating the support for different proposed amendments, supported its Congress approval which took place in February 2021. Leasing contracts, according to the Guatemalan Registry of Secured Transactions (Registro de Garantías Mobiliarias), after a year of the reform, the monthly amount of leasing contracts increased 230%.
Anti Red Tape Act (Ley de Simplificación de Trámites Administrativos). The legislation demands that the Executive streamlines and introduces digital platforms to deal with administrative procedures that affect citizens and businesses. Three new drafts were created under my direction. Once the proposal reaches Congress, the Ministry supported its Congress approval which took place in May 2021. Here is a short description of its benefits (in Spanish). This legal framework allowed us to reform administrative procedures. One in particular, affecting exporters was reduced from 118 days to 22 hours.
Reforms to the Free Trade Zone Act (Reforma a la Ley de Zonas Francas). A new set of proposed reforms was created to: a) allow more economic activities to be conducted inside the Free Trade Zones; b) minimize the tax expenditure; and c)
Insolvency Act. A new project was created under my direction with support from the international community. The Ministry supported its Congress approval which took place in February 2022.
Reforms to the Free Trade Zone Regulation. The reforms was created considering: a) the new responsibilities the tax authority had in the process; b) the need to adapt the all the process to the Anti Red Tape Act, allowing for the introduction of a new digital platform; and, c) the regulation of the fare rates to make the new digital platform sustainable.
Metrology Center Fare Rates Regulation. The regulation took three governments and over six years to be approved, achieving it in September 2022. The services provided are important to increase the competitiveness of firms and laboratories in Guatemala. A second fares rates regulation, this one for COGUANOR, the entity in charge of the national standardization policy, was greatly advanced and expected to be approved during 2022.
Implementing the anti-red tape legislation
The following programs were implemented:
Construction Permits One Stop Shop. This is a digital platform to obtain the National-level requirements needed to obtain the construction license. While the program started with a pilot project and diagnostics during the previous administration, my role was to institutionalize it. This was achieved by: a) agreeing on a Regulation to define coordination mechanisms; b) supporting the Anti Red Tape Act that allowed for greater streamlined processes than originally planned; c) defining an Accord between the Executive and the Guatemalan Construction Chamber on the characteristics of the One Stop Shop and the support that will be provided for the digital platform; and, d) agreeing on a 9-institutions manual that governs the digital platform for all those entities. One local government is already part of the project and two more and on their way.
Streamlining the Free Trade Zones and the DrawBack Regime (Zonas Francas y Maquilas). AFter the introduction of the Anti Red Tape Act, and additional institutional reforms (Ministerial Accord, operation manuals and hardware support), allowed us to start the reform of administrative procedures involving Free Trade Zones and the DrawBack Regime. One administrative procedure in particular (adición de partidas arancelarias), affecting exporters was reduced from 118 days to 22 hours. We also introduced the electronic notification that is expected to guarantee that citizens will benefit with timely procedures regardless of their location.
Consumer protection new digital platform. The previous digital platform was plagued with problems: a) it did not allow to attach documents relevant to prove the validity of the consumer´s complaint; b) it did not allow to be digitally resolved by the government agency, in practice it was only a mechanism to digitally receive complaints that eventually was resolved manually; c) it did not favor conciliatory mechanisms. The new platform deals with the first two aspects. Its first edition was launched in March 2022. It is expected that by the end of 2022 it will deploy an online conciliatory mechanism.
National quality system digital platform. Thanks to the support of the European Union cooperation, the National Quality System is in the last phases of developing a digital platform to manage requests from citizens and firms. It should be online by mid-2022.
Dealing with COVID-19
I had two roles dealing with COVID-19.
First, the Congress assigned to the Ministry of Economy and the Ministry of Labor the deployment of "Furlough Job Retention Scheme" called Fondo de Protección del Empleo. The program, totaling close to US$260 million, was 5 times larger than the average budget of the Ministry of Economy , so it demanded the attention and support from several sections of the Ministry. In the end, 99% of the budget was executed, serving over 150,000 workers. My role, taking advantage of what I learned during my PhD, was to use statistical tools to identify problems in the payment algorithm and to suggest alternatives to fix it.
Second, my team lead the development of the Government´s COVID-19 Economic Recovery Plan. Identifying key projects for the plan and providing support for their implementation was important for the years 2020 and 2021.