Brakes on Competitiveness in El Salvador

Informality in the labor sector, low levels of taxation and little investment in innovation and development are some of the obstacles the country is facing in terms of competitiveness.

Monday, September 17, 2018

The Ministry of Economy presented the "First National Competitiveness Report", which analyzes more than 200 indicators obtained from indices prepared by international organizations such as Doing Business, Competitiveness Index, Trade Facilitation, Global Innovation, Connectivity and Index of Performance of Energetic Structure.

The Deputy Minister of Economy, Julian Salinas explained to that " ... among other things, the weaknesses that El Salvador faces in being competitive are the high rates of informality in the labor market, in addition to a low coefficient of taxation, "little expenditure" by the private sector in research and development and a poorly developed financial market. "

According to the report, in 2017 " ... 46.9% of El Salvador's EAP was in the informal sector and the rest (53.1%) in the formal sector. "

Through a statement, the Ministry of Economy explained that the seven areas covered by the report, ordered from the most advanced stage to which a country should aspire to, to the most basic, are: Innovation, Science and Technology, Internationalization, Productive and Business Development, Energy and Natural Resources, Human Capacities, Infrastructure and Logistics and Institutionality. These areas capture a systemic approach to competitiveness.

¿Busca soluciones de inteligencia comercial para su empresa?

Do you need to keep track of the key economic indicators in Central America?

Request more information about our Regional Economic Monitor.

this site is protected by reCAPTCHA and Google's privacy policy and terms of service.
Need assistance? Contact us
(506) 4001-6423

More on this topic

Low Competitiveness and Capital flight

December 2020

Due to the precariousness of the English language, in recent years’ companies in the Contact Center & BPO sector have decided to close thousands of jobs in the region and relocate their investments to other markets where they have no difficulty in recruiting qualified personnel.

Reports at a global level show that the command of English is one of the weaknesses at a Central American level.

El Salvador: Economy Begins 2019 Downward

May 2019

The sales indicator declined during the first quarter and economic activity lost dynamism up to February, because of the adverse international environment and growing uncertainty.

The Sales Indicator of the Salvadoran Foundation for Economic and Social Development (FUSADES), reported a negative variation in the first quarter compared to the same period in 2018, going from 16.5 to -7, which is explained by the behavior of the four economic sectors surveyed, reported the Foundation.

The Economy of El Salvador in the Second Quarter of 2012

August 2012

The Salvadoran Foundation for Economic and Social Development (FUSADES) has released its Situation Report for the period April-June 2012.

From the press release by Fusades:

While the global environment is complicated, the Salvadoran economy in the first half shows a trend of deceleration, and the institutional crisis is further deteriorating the investment climate.

Economic Activity Declines in El Salvador

November 2010

The FUSADES report notes that the Salvadoran economy has declined and stagnated to 2007 levels.

Fusades presented the results of the Economic Situation Report July-September 2010.

The slight recovery observed during the second quarter of 2010 shows signs of exhaustion in the third quarter, referring to short-term indicators such as IVAE and employees contributing to the ISSS.