Is there a Way to Reactivate the Salvadoran Economy?

A new proposal from the business sector aims not only to propose solutions to the fiscal problem but also strengthen productive areas in order to grow in a sustainable manner.

Friday, July 29, 2016

The National Association of Private Enterprise (ANEP) has summarized its proposals based on four pillars: economic growth, combating and reducing poverty, strengthening democratic institutions, and a pact on fiscal responsibility.

See "IMF Warns El Salvador of Fiscal Crisis"

The president of the union, Luis Cardenal, told Elsalvador.com that "... at the moment the government alone is solving the crisis and is working on measures that will allow the country to exploit its economic potential, which in the opinion of the business organization, are in areas such as tourism, logistics and international services, as well as industry and agribusiness for export. "

"... The contribution of the ANEP is added to a series of economic measures that the regional representative of the International Monetary Fund (IMF), Mario Garza suggested a week ago. Garza said the country is in a cycle of low economic growth and high debt, which has caused disorder in state finances. "

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More on this topic

Fiscal Crisis: Less Spending and More Information

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Given the agreement reached by the Alvarado administration and the IMF for Costa Rica to access a $1.75 billion loan, the business sector is calling for a reduction in public spending and for detailed information on the scope of the agreement signed by both parties.

In an attempt to ease the fiscal and economic crisis the country is going through, last year the Alvarado administration began negotiations to access a loan for $1.75 billion to be requested from the International Monetary Fund (IMF).

IMF Warns El Salvador of Fiscal Crisis

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The IMF has insisted on the need for fiscal consolidation and warns that "if measures are not taken, the debt could rise to unsustainable levels."

From the press release by the IMF:

IMF Executive Board Concludes 2016 Article IV Consultation with El Salvador On June, 20, 2016, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation1 with El Salvador.

IMF Details Problems in El Salvador

May 2016

The IMF has indicated political polarization, high crime and outward migration, rising unit labor costs and high logistics costs, barriers to entry and expansion of business, fiscal uncertainty, and limited human capital.

From a statement issued by the IMF:

The IMF staff team visited San Salvador during April 25—May 6 for the 2016 Article IV consultation and held fruitful discussions with the Salvadoran authorities, parliamentarians, business community, academics, and social partners.

Costa Rica: Another Chapter in the Fiscal Debacle

February 2016

Central government, state unions, managers of public enterprises, deputies, supreme judges, all are being held in the deadly embrace of privileges while they drag Costa Rica over a cliff.

EDITORIAL

As long as the compensation system that excessively rewards state employees, regardless of their actual performance, is maintained, and the tax system is not reformed, fiscal problems will get worse.

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