What if the true secret behind the progress of nations were not found in grand political speeches or in the clientelist social welfare policies that dominate headlines, but rather in the silent force of industrial productivity? Since the late 19th century, when England, the United States, Germany, and Japan embraced industrialization, it became clear that sustainable wealth does not originate from subsidies or short-term programs, but from the ability to produce more with less, to transform raw materials into high-value goods, and to sustain increasingly sophisticated industrial chains. Today, in the midst of the digital and service era, this truth remains valid. However, the news that Germany — Europe’s historic industrial powerhouse — lost 21% of its industrial productivity in just one year shook the entire world. If even Germany has lost its competitiveness, what hope is left for the rest of the mortals? In this contrast, Asia emerges: while Europe declines, countries like Vietnam, India, and Bangladesh seize every opportunity to grow by boosting their industrial productivity.
History demonstrates this harshly. If we study the last 25 years, the nations that managed to transform their economies on the basis of industry have multiplied incomes, generated stable jobs, and built sustainable prosperity. In Europe, the so-called PIGS — Portugal, Italy, Greece, and Spain — along with the United Kingdom and France, have lower industrial productivity compared to the year 2000, dragging with them a sense of stagnation reflected in unemployment and economic weakness. Even Germany lost one-fifth of its industrial productivity, showing that no one is safe from decline. On the other side, countries like Ireland, Slovakia, and Poland nearly doubled their productivity over those same 25 years by betting on free trade zones, foreign investment, and commercial openness. The map is clear: falling productivity anticipates crises, while rising productivity precedes prosperity.
In the Americas, the picture is equally revealing. Venezuela, Cuba, Argentina, and Brazil show painful regression, while the United States and Canada barely maintain the same productivity they had two decades ago, without much dynamism. In contrast, Colombia, the Dominican Republic, Chile, Panama, and Costa Rica increased their indexes by more than 35 points during that period, attracting investment and manufacturing. Guatemala, although still at the starting point, managed to improve by 20 points, a sign that progress is possible when the right conditions are established. The drive of Guatemalan entrepreneurs toward industrial sophistication has allowed us to export top-level products today in competitive industries such as plastics, steel, cement, beverages, and chemicals; the next step is to leap toward greater sophistication and develop an industrial policy that pushes us there as a country.
Meanwhile, Asia’s case is even more compelling. China has multiplied its productivity fivefold, Vietnam threefold, while India, Thailand, Indonesia, and Bangladesh have doubled theirs. The consequence has been the migration of factories from Europe and the Americas toward this continent, transforming their societies in less than one generation. The only Asian country with lower industrial productivity than 25 years ago is Japan, trapped in its population decline and loss of economic potential.
But it is not enough to point out winners and losers: the crucial thing is understanding why. Our mathematical analysis of structural variables shows that countries that advance combine three essential factors: competitive energy, efficient logistics, and fiscal frameworks that attract investment. Expensive energy is an immediate burden for industry. It is enough to compare the cost of the kilowatt-hour in the Northern Triangle with that of the Dominican Republic to understand why some countries attract manufacturing plants while others lose them. Every new energy bidding process, such as PEG3 and PEG4, must focus on reducing the cost of electricity by at least one point, because that point can mean thousands of lost jobs. That is why the articulation between the PEG-5 bidding process and its connection with the PET-3 transmission bidding process must be made more transparent and agile, while pushing forward all electrical expansion processes until we become the electrical giant of the region.
Betting on industrial productivity is an existential decision about the country we want to leave to our children.
Logistics is the second pillar. Every five minutes that a truck saves on its route to Puerto Quetzal or Santo Tomás increases Guatemala’s industrial competitiveness against Mexico or Panama. Port infrastructure, digital customs, and logistics corridors are not luxuries: they are the real engines of growth. Panama’s experience is clear: its commitment to logistics infrastructure has triggered industries around it, from assembly operations to associated services, boosting its productivity and exports.
The third factor is fiscal policy. It is true that the Income Tax rate alone does not explain productivity, but it is the gateway key for attracting capital. That is why nations such as the Dominican Republic, Panama, and Costa Rica boosted their industrial productivity by 35 points or more by offering free trade zones with Income Tax exemptions. Ireland, Armenia, Georgia, Bulgaria, and Paraguay followed a similar strategy with equally forceful results. But fiscal incentives alone are not enough. The accumulation of fixed capital is the variable that drives industrial growth. This means more automation, more robots, and greater efficiency supported by artificial intelligence. It also represents more local research and development and greater integration into global value chains. In a world where margins are defined by seconds and cents, only those who innovate survive. Furthermore, insisting on simplifying and reducing the fiscal burden for productive investment does not mean giving away resources to investors, but rather betting on the multiplier effect that creates jobs, links sectors, and energizes the economy.
Added to this is the need for greater labor flexibility. Every flexibilization allows more people to access formal industrial jobs, better paid and with growth opportunities. Social programs help those in need, but it is industrial employment that offers real opportunities for social mobility. This is not about abandoning the countryside, but about transforming it: agricultural GDP today represents less than 10% of the economy, while industry accounts for around 20% and services exceed 60%. The land must produce high-value inputs or integrate into industrial chains, as CMI, Nestlé, and Cervecería have done with grains that feed export manufacturing processes. This is the path for agriculture to complement industry, not replace it.
Guatemala also possesses an asset we cannot waste: the youngest population on the continent. Our average age is almost half that of Italy, Germany, or Portugal. That demographic advantage is pure gold in terms of industrial productivity because it means an abundant, adaptable workforce with decades of contribution ahead. But this window will not last forever. If we do not generate industrial jobs now, that youth will turn into unemployment, migration, and lost potential.
History teaches that nations that bet on industry transform their destiny within a single generation. China did it in 25 years; Ireland in two decades; Poland in less. Guatemala has that same opportunity today. But it also faces the same dilemma: deciding whether it wants to be a country that exports young people in search of work or products that conquer markets. Every additional point of industrial productivity is not just a technical statistic: it is a new job, a family with dignified income, a young person who does not need to migrate. Let us not allow our window to close. Betting on industrial productivity is an existential decision about the country we want to leave to our children.
