Manufacture and assembly of electrical components
Emilio Márquez
emarquez@investlbdev.consiti.com
Mobile: +503 7071 7029
El Salvador is pursuing a strategy to promote sustainable investments in the manufacturing sector, using its strategic location as a competitive advantage to integrate its industries and supply chains.
El Salvador’s electrical components manufacturing and assembly sector attracts foreign investors due to its location, competitive labor costs, and preferential access to markets such as the United States through free trade agreements. In addition, the government offers competitive tax incentives, with a growing focus on sustainability and innovation, driven by technical training in educational institutions.
Increasing global demand for electrical products and creating industrial clusters in the country encourage collaboration and the development of a skilled workforce, which facilitates the diversification and expansion of companies in this growing market.
Electrical capacitor exports, 2023
largest global exporter of capacitors and second largest in Latin America, 2023
Exports of the electronics sector,2023
EI Salvador has a good base of technicians and professionals willing to join the country’s productive sectors.
ELECTRONIC COMPONENTS:
Thanks to growing global demand in key sectors such as automotive, electrical, 5G, and renewable energy, El Salvador is well-positioned to expand its electronics ecosystem.
- Capacitors
- Resistors
- Inductors
- Connectors
ELECTRICAL COMPONENTS
- Cables
- Electrical and control panels
- Isolators
- Switches
- Conductors
investing in
El Salvador
- Strategic location for nearshoring, facilitating integration into the value chains of the manufacturing industry in North America, with access to both U.S. coasts in less than 6 hours.
- The safest country in the Western Hemisphere in 2024, with a dollarized economy offering stability and certainty for investors seeking profitable opportunities.
- Advanced technological platform, featuring the construction of a submarine cable, deployment of 5G, and collaboration with Google to accelerate digital transformation, enhancing automation and optimization of industrial processes.
- Modernized and digitized customs, with an integrated customs system facilitating regional trade and commerce with the United States, supported by an agreement with the U.S. Customs and Border Protection.
- Implementation of tailored skill development programs for companies and government incentives for hiring in strategic sectors in El Salvador.
- The most attractive free zone regime in Latin America, offering up to 45 years of tax exemptions and accessible requirements for investment.
- Tax incentives for renewable energy generation projects, enabling more economical and sustainable production supported by one of the most diversified energy matrices in Latin America and the Caribbean.
- Legal and tax stability, with a stable political environment and the option of legal stability contracts for up to 20 years with investments exceeding USD 15.4 million in fixed assets.
- Exemption from customs duties and other taxes on the importation of machinery and equipment necessary for exportable production during the period in which they carry out their operations.
- Exemption from customs duties and other taxes on the import of raw materials and other equipment necessary for the execution of the incentivized activity during the period in which they carry out their operations.
- Exemption from customs duties and other taxes on lubricants, fuels and other substances necessary for the productive activity during the period in which they carry out their operations.
- Total exemption from Real Estate Transfer Tax for the acquisition of real estate to be used in the promoted activity.
- Exemption from Income Tax in accordance with the following detail:
- Leading Japanese company worldwide in automotive cable and harness systems.
- Started operations in the department of Santa Ana in 2006.
- Current employment: More than 1,200.
Production: 300 to 400 harnesses per day. - Turnover: 0.48% per year.
- Operational efficiency: 80%, exceeding the standards of other YAZAKI plants worldwide.
- Brands manufactured in El Salvador: Subaru (harnesses), Jeep (chassis harnesses), and Chrysler (door harnesses).
- More than 37 years operating in El Salvador.
- Manufactures ceramic and tantalum electronic capacitors that meet international standards.
- AVX Kyocera went from assembly to chemical processes, molding, testing and packaging. The implementation of the new production lines took 10 months, compared to two years in other countries.
- Its operations in the country have a high production efficiency, which amounts to 97%.
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