Foreign Investment in El Salvador Still Falling

FDI fell from $ 1.508 million in 2007 to $ 72 million in 2010. Businessmen claim the cause is the lack of confidence and certainty in current government economic policy.

Friday, December 17, 2010

2007: $ 1508 million, 2008: $ 784 million 2009: $ 431 million, 2010: $ 72 million. There should be a special consideration with the 2007 FDI numbers since they were affected by exceptional events such as the sale of banks to multinational banking corporations.

In 2010 only 14 companies came to El Salvador to install and operate in the country.

The decline in foreign direct investment (FDI) in El Salvador, particularly during the last year, is a concern for the corporate sector, as outlined in the article published by Elsalvador.com, “it is the result of lack of trust and confidence, which in turn affects investment, employment and the overall economic growth."

More on this topic

El Salvador: Lags behind in Attracting Investment

July 2011

Of all the foreign investment coming to Central America, El Salvador receives the lowest amount.

In the first three months of the year only $170 million in foreign investments flowed into the country , less than the $468 million that went to Costa Rica and the $177 million to Guatemala.

FDI down in Central America and Caribbean

September 2009

The manufacturing sector as a whole saw a decline in FDI due to a sharp drop in flows to Central America and the Caribbean.

In Central America and the Caribbean (other than financial centres), the decline in FDI inflows was largely due to a 20% fall in flows to Mexico, which mainly resulted from a halving of inflows to the manufacturing sector (CNIE, 2009).

The Race to the Future

August 2009

¿Which are the most attractive countries for Foreign Direct Investment? In Central America and the Caribbean, Puerto Rico is ahead, followed by Costa Rica and Dominican Republic.

fDi Magazine presented the results of their first fDi Countries of the Future 2009/10 Award.

Foreign investment falls 62% in El Salvador

December 2008

During the last 15 years, foreign investment rose only with the sale of banks and privatizations.

In 2007 $494.8 million entered the country compared to the $189.9 this year.

The reason for the drastic reduction in FDI is simple. In 2007 the sale of Salvadoran banks were completed, causing the investments to increase disproportionately compared to investments in 2006.

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