El Salvador's economic activity to grow 4.6 % in 2023

The country’s main economic sectors, such as construction, tourism, finance, and professional services, were boosted thanks to various strategies implemented by the government of Nayib Bukele.

El Salvador continues to experience sustained economic growth as a result of different strategies implemented by the Bukele administration, from the simplification and digitalization of legal processes to the consolidation of social security.

In this sense, the Central Reserve Bank (BCR), reported that El Salvador’s economic activity continues to expand. This is reflected in the Volume Index of Economic Activity (IVAE) -which measures the evolution of the performance of the different industries included in the calculation of the Gross Domestic Product (GDP)- which grew 4.6% annually in November 2023.

The BCR highlighted that the economic activities that showed a greater dynamism in November 2023 were: Construction, financial services, commerce, transportation, hotels, restaurants, professional and technical services, communications, and others to a lesser extent.

In terms of percentages, the construction sector contributed 18.3 %, followed by financial services with 16.4 %, commerce, transportation, hotels, and restaurants with 7.2 %, technical professional services and others with 5.8 %, and communications with 2.8 %.

As for the construction sector, the fastest growing, BCR data indicate that it stood out with an increase of 10.6 % to the third quarter of 2023. Currently, the sector generates around 120,000 jobs, both direct and indirect, and the Salvadoran Chamber of the Construction Industry (Casalco), foresees that last year’s closing data showed $2.1 billion in investment.

The BCR also highlighted that the strategies implemented by the Government of El Salvador boosted the factors that influenced the positive performance of the IVAE: the realization of Miss Universe El Salvador 2023, the increase in tourism, the increase in public and private investment, the dynamism of the financial sector, and the recovery of the industrial sector.

In tourism, for example, the sector that has most benefited from the security achievements of the Government of Nayib Bukele, in 2023, the arrival of 3.4 million foreign visitors to the country was reported, leaving $3,793 million in foreign currency, a 43% increase compared to 2022.

Thanks to this sustained dynamism of the sector, the authorities increased the projections for 2024, setting the goal at 3.8 million international visitors who would leave the country with $3,800 million in foreign exchange income, representing a 12% increase compared to 2023.

Meanwhile, domestic tourism also registered a record number of visitors. According to the National Institute of Tourism (ISTU), 10 million people visited the different public spaces in 2023, up 56 % compared to the previous year.

Source: Diario El Salvador