Guatemala participates indirectly in the Qatar 22 World Cup and these are the winning sectors

In Guatemala there is no official data on the economic spillover that occurs during the month that the Qatar 2022 Soccer World Cup will last, compared to the participating teams and countries where this type of measurement is made.

However, many productive activities register greater activity due to the additional demand that is generated every four years in relation to this event, which, in the case of 2022, will be combined with the activation of businesses for the year-end festivities. Therefore, there are several winning sectors.

“There are already reservations”

The first of these is the restaurant sector, which points to an increase in sales of 15 to 20 percent compared to normal, and above all, a greater movement is expected when the teams with the greatest fans in the country participate.

Abraham Az Palermo, president of the Restaurant Association of the Guatemalan Chamber of Commerce (CGC), commented that Qatar 2022 will activate businesses after two years affected by the pandemic and confirmed that many of the restaurants have made investments, such as expansions or remodeling; others are launching promotions and alliances with suppliers to generate different experiences.

“The sector is betting heavily on this activity; It is the first massive event and customers are expected to respond, as many restaurants are devising promotions to be able to return to normality, only now with more emotion and passion”. So in many establishments, sports bars with the theme of soccer are being reactivated, and others will offer breakfasts to promote sales volume.

Another effect will be in the hiring of personnel and the acquisition of more products in supermarket chains, for example, because “at the end of the day we all win and the economy is activated.”

Shirts and promotional

The clothing and textiles sector also already covers a high demand for garments, flags and other promotional products that accompany the World Cup party, not only to cover the internal market, but also the external one, thus increasing the demand for fabrics and assemblies for shirts.

Textile businessman Alejandro Ceballos explained that orders began to rise a few days ago both to serve customers in Guatemala and in other countries. “And as the championship phases progress with the teams from Brazil, Mexico and Argentina, the sales of the teams that are winning rise.”

He added that the brands that manufacture the garments in Guatemala can ship them in record time and cited as an example that if the Mexican team reaches a final, it would be a success to sell shirts from that team, and the same will happen with the other countries.

Commercial space

For the sports journalist Francisco Aguilar Chang, the Qatar 2022 Soccer World Cup opens many spaces to market products that are imported or made in Guatemala, with the names of the teams of the participating countries and the sports theme.

“The sale of the articles that are being promoted in the World Championship, even specific activities such as promotions so that the winners can attend the matches are important because everything revolves around that,” he stressed.

But in his opinion, it will depend on each person, what they are willing to buy, according to their economic capacity.

high expectation

So, watching or listening to football matches between family groups or friends will be the excuse for people to get together after the health crisis and the restrictions implemented.

Az Palermo assured that, in its particular case, it will activate promotions when the Argentine team plays (due to the origin of its establishment) especially for breakfast, and if it is at dawn, it has also already defined its commercial strategies.

He recognized that there are teams that “pull” public like Argentina, Germany and Brazil, for which the establishments have already been prepared.

Another aspect, and as the party season approaches, the Qatar 2022 World Cup is also an excuse for families or groups of friends to meet in restaurants and, of course, there are reservations for days when certain World Cup teams will play.

What the figures say

The Monthly Index of Economic Activity (Imae) for September provides a perspective on how the economy prepared to meet the demand for the World Cup, since all types of entrepreneurs know that it is a “good business season.”

As of September, according to the Banco de Guatemala report, the Imae was at 4% and in August at 4.5%. The activities that had growth are trade and vehicle repair, accommodation and food service activities, and manufacturing industry (which could be associated with the preparation for the World Cup).

In 2018, which was carried out between June and July, the Imae also had a positive sequence in the two previous months: in April of that year it was 4.3% and in May, 4.4%.

The Imae is an indicator that provides the pulse of the economy on a monthly basis, as a short-term indicator.

Food and beverage sector: A wide chain

Julio Orozco, executive director of the Food and Beverage Union, attached to the Guatemalan Chamber of Industry (CIG) provided a perspective for the sector for this 2022 World Cup for the sector.

What impact can the Qatar 2022 Soccer World Cup have on the economy and industrial activity in your sector?

In the food and beverage sector, we anticipate that the Qatar 2022 Soccer World Cup will have implications throughout the entire agri-food chain, ensuring the supply and availability of food and beverages on the shelves, points of sale, and consequently, in the population tables.

Particularly, we see impacts in the agricultural sector, suppliers of raw materials and packaging, carriers, supermarkets, producers, among others; which are reflected in the most dynamic categories within the framework of this event, such as: snacks, carbonated drinks, sauces, condiments and seasonings, cookies, meats, fats and oils, among others.

How have the industries prepared to meet the demand during the World Cup and the end-of-year holidays?

It is important to highlight that the international context, such as the covid-19 pandemic, the increase in container transfer prices and inflation in Latin America, among other factors, have had a positive or negative impact on the response and preparation capacity. of the different sectors to meet the demand that is generated around the World Cup.

Under the scenario where there is no stabilization in the short term, it is important to highlight that food and beverage consumer companies are implementing the best practices and technically correct measures to mitigate inflationary pressures and supply problems to avoid price increases at final consumer, which we recognize has been affected by the pandemic.

At the time, there was a challenge with the supply of raw materials and packaging for some categories. For this, the food and beverage sector proactively resorted to a series of alternative measures such as multimodal transport systems, among others. For the 2022 World Cup, we anticipate assorted shelves.

At the moment there are no signs of shortages, only delays in the delivery of some categories and raw materials. As a sector, we are working to ensure the supply of our products at points of sale throughout the country, so that the population can have uninterrupted access to the food and beverages they need on a daily basis and to meet the demand that is generated around the Soccer World Cup.

What will 2023 be like for the Guatemalan economy? Register free of charge for the webinar Economic Outlook 2023: Possible routes for Guatemalaorganized by Free Press.