Caribbean & Central America - May 2017 (ISSN 1741-4458)

At the end of last month President Jimmy Morales named Víctor Manuel Asturias Cordón, a mechanical engineer by profession, as his new economy minister. He replaces Rubén Estuardo Morales Monroy, who stepped down for unspecified “personal reasons”. Asturias’s appointment is just one of various which are proving controversial for the president and his small, conservative Frente de Convergencia Nacional (FCN-Nación) government.

Asturias took over on 28 April from Morales Monroy who became President Morales’s fourth minister to step down since the FCN-Nación government took office in January 2016. Others to have seen the door include Sherry Ordóñez (communications & infrastructure) who quit after just 11 days in the job over an alleged conflict of interest. Four months later, energy & mining (MEM) minister Juan Pelayo Castañón resigned – a move linked by the local media to a dispute over the ‘El Tambor’ gold mine [RC-16-08], while in July Health Minister Alfonso Cabrera stepped aside over his failure to address the health crisis.

Having served as advisor to the gas company Zeta Gas de Centroamérica SA (2013-2014), and general manager of Trade & Investment SA (2007-2013) (which provides satellite monitoring services), Asturias has held the post of general manager of energy engineering group Grupo Tekno Energy SA since 2015. He also has been the general director of Localiza El Salvador SA for El Salvador and Guatemala, a firm that also provides GPS and monitoring services, since 2008. His appointment has come under fire however from local media such as investigative daily El Periódico which in a report published on 2 May suggested a possible conflict of interests. El Periódico cited figures from the tax authorities (SAT) and web portal Guatecompras (where all bids and information about awarded public contracts above a certain threshold have to be published) which suggest that Localiza El Salvador SA received a Q$39,250 (US$4,149) contract from the economy ministry on 17 March to provide a service of “GPS control and monitoring” for 25 vehicles between March and December 2017. According to El Periódico, the company has won state contracts worth Q$23.36m between 2008 and 2017. The issue has attracted concern given Guatemala’s constitution prohibits those who provide contracts to the state from serving as ministers.

More controversial appointments

As well as the appointment of Asturias, who has since told reporters that he had left the company years ago but the records had not been updated, President Morales’ judgement has further been called into question after the constitutional court (CC) suspended the appointment of six departmental governors. The CC’s ruling on 2 May is in line with an appeal presented by the main opposition Unidad Nacional de la Esperanza (UNE) party together with local departmental development councils (Codedes), who argued that the appointees were unsuitable. President Morales had substituted eight of the 22 departmental governors (who are appointed by the executive) on 10 March.

The CC ruled against the appointments of Carlos Rafael Moreira Salazar (Sacatepéquez department), Julio Calderón Flores (Huehuetenango), Oswin René Morales Flores (San Marcos), Marvin Estuardo Alvarado Morales (Totonicapán), Héctor Eduardo Flores Moscoso (Santa Rosa), and Luis Antonio Herrera Rabanales (Suchitepéquez). According to El Periódico, complaints include the fact that Moreira was accused of tax debt, while in 2011 Calderón was ordered to pay Q$19,000 (US$2,588) in damages to a teacher for unjustified dismissal and he was convicted of fraud in 2012. Meanwhile Morales Flores was reportedly appointed despite a CC ruling ordering his suspension after it emerged that he had not been proposed by the local Codede. This breeches the organic law of the executive which establishes (Art. 42) that the president must make gubernatorial appointments “taking into account” candidates proposed by the Codedes.

• GDP growth

Asturias takes up the post of economy minister as the most recent (24 April) update by the United Nations Economic Commission for Latin America & the Caribbean (Eclac) forecasts 3.4% GDP growth for Guatemala in 2017. This is slightly below the 3.6% average for Central America – below Panama (5.2%), Nicaragua (4.6%), Costa Rica (4.15), and Honduras (3.7%) but above El Salvador (2.5%).