Construction of the first railway in Guatemala began in 1877, with the first section opening in 1880 between the Pacific port of Puerto San José and Escuintla. The line was extended to Guatemala City in 1884. The gauge was 3ft (914mm), which was also used for subsequent lines in the country.
Further development had to wait until the start of the 20th century, when in 1904 the United Fruit Company (UFCo) of the USA was awarded a 99 year concession to build and operate a 320 km line from Guatemala City to the Caribbean port of Puerto Barrios, the primary objective of which was the development of thte banana growing and export industry in Guatemala. The new line was completed in 1908.
UFCo, through its subsidiary International Railways of Central America (IRCA), acquired control of the original railway and further developed the network, culminating in a system of some 885 km with international connections to Mexico and El Salvador.
Following the second World War the Guatemalan banana industry went into a period of decline. In 1954 UFCo sold its interests in IRCA. IRCA continued to operate as an independent entity until 1968, when declining traffic and increased competition from road transport brought about its demise. The railway concession reverted to the state, which continued to operate the system (as Ferrocarriles de Guatemala) until 1996 when poor condition of track, locomotives and rolling stock following on decades of underinvestment forced eventual closure.
In 1997, the USA company Railroad Development Corporation was awarded a concession the rehabilitate the network. By 1999 they had reopened the line from Guatemala City to Puerto Barrios, which then carried freight and some tourist passenger traffic. However, the concession was withdrawn by the Guatemalan government in 2007 and operations ceased.
In 2012 a study was begun in conjunction with te Spanich rail company FEVE into the possibility of reintroducing passenger services.
Flag image from CIA World Factbook