Complete Thesis_double spaced abstract.pdf

foreign corporations. After the Arbenz coup the largest banks in Guatemala called in close to
90% of their outstanding loans, this was a crushing blow to the smaller farmers who relied on the
loans to carry the household between harvesting seasons (Calvert, 1985, 124). Access to credit or
capital for small farmers or middle class households became increasingly restricted during this
time period, “90% of all bank credit was monopolized by big export growers” (Jonas, 1991, 46).
Colonel Armas, General Ydígoras and General Peralta were cognizant of and concerned
by the declining worldwide price for coffee and other agricultural exports. Since the 1950s, the
competition from coffee producing states had driven the price of raw coffee beans down each
year, as states became more efficient producers of coffee. The decline in price per pound offset
any additional earnings from increased production. As a reaction to fluctuating prices for primary
commodities, Colonel Armas, the elites, and the members of the military establishment, began to
push for increased state involvement in economic development. As a result, the National Council
of Economic Planning of the Presidency of the Republic (CNPE) was founded as an advisory
body to the president in 1954. The purpose of the National Council was to give direction and
cohesion to the development of the economy from a national perspective. The council itself had
no power, but rather exerted influence through recommendations to the president. The council’s
first report was issued in the early 1960s; much of the analysis and recommendations came
directly from World Bank (IBRD) studies. The Second, Third and Fourth Plans were released
during the 1960s and early 1970s. Reforms and recommendations called for by the CNPE
included the development of infrastructure, electrical power plants, growth in forestry and
diversification of agricultural sectors (Calvert, 1985, 157). Furthermore, all three of the plans
released during the 1960s and 1970s emphasized the need to create jobs, spend more resources on
public financing of projects with a regional distribution of funds, and to correct the imbalance in
the distribution of resources throughout the state. Many of the recommendations by the CNPE
130