Customs in El Salvador: Less and Less Competitive

The waiting times for export products passing through customs offices in El Salvador increased from 2.8 days on average in 2011 to 4.7 days in 2013.

Friday, September 12, 2014

From a statement by

The Business Competitiveness Survey (ECE) was conducted for the third time, in which employers provide information on obstacles and opportunities in ten areas critical to compete globally. In the survey interviews were carried out, on average, with 425 companies of different sizes: micro, small, medium and large. The information provided is useful for focusing resources on higher impact activities, assessing government support measures and finding new opportunities for public-private partnerships. A brief summary of the results:

Exporters demand more support for market and improved products

Exporting companies identified that the major efforts made to sell abroad, were aimed at strengthening relationship with buyers by maintaining contact with customers (51%) and visiting customers (47%); but also, efforts were made to improve the quality of products 50%, reduce production costs (39%) and develop new products (38%). However, exporters reported obstacles in three levels:

Problems within the company, focusing on high operating costs (43%), lack of international markets (17%) and ineffective marketing strategies (9%).
Barriers to competing at the national level, mainly due to the high cost of electricity (38%), lack of incentives for export (36%) and crime (28.3%).
Challenges in international markets, strong price competition (44%), reduction of orders (35%), and presence of new competitors (17%).
Innovators improved quality and reduced costs per unit.

More on this topic

How Can Exports from El Salvador Be Revived?

September 2016

Insecurity and excessive red tape remain the main obstacles to the growth of exports, which have lost momentum in the last four years.

From the Survey on Business Competitiveness by Fusades:

FUSADES has carried out the "Business Competitiveness Survey" every year since 2011, interviewing more than 430 micro small, medium and large enterprises. The surveys help to statistically demonstrate the challenges and opportunities in improving growth and employment generation, the only institution in the region that makes such an effort.

El Salvador: Competitiveness Initiative

October 2014

Representatives from the Competitiveness Initiative have submitted diagnoses and proposed solutions in education and business, infrastructure, procedures and access to markets and investments.

From a statement issued by the Competitiveness Initiative:

There is widespread concern about the observed low growth in the economy, which is manifested in a limited number of formal jobs, and a weak use of global opportunities.

Another Tax to Pay: Extortion

September 2011

In El Salvador, where the cost of insecurity is equivalent to 12% of GDP, extortion is the main obstacle to economic development.

Crime affecting the country stops economic development and investment, according to the technical secretary of the Presidency, Alex Segovia.

El Salvador Spends Over $2 Billion per Year on Security

July 2010

The statistic includes public and private spending and represents 10.8% of the country's GDP.

Jorge Daboub, president of the El Salvador Chamber of Commerce and Industry, indicated that in the case of private companies the annual cost of security is more than $640 million.

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