Insecurity and Uncertainty

Salvadoran business owners point out that the main causes of the country's poor economic performance is still growing insecurity and a lack of a clear political course.

Tuesday, March 6, 2018

The Salvadoran business chambers agree that the beginning of the year has not been the best, since the obstacles that for several months have made it difficult to operate and grow private sector activities still remain.

Regarding this issue, the president of the Association of Distributors of El Salvador, José Mayorga, told that "...' Performance is slow. There are two things that are affecting us, first the high level of extortion that is forcing us to increase production costs more and more, since we have to increase security to get into certain neighborhoods, and the second is political uncertainty, because a lot of businesses have decided to wait until investing, they want security that the rules of the game will not change, these are the two main factors that are affecting distributors in the country'."

In relation to performance in 2017, the president of the Agricultural and Agroindustrial Chamber of El Salvador, Agustín Martínez, said that "... 'Last year was not the best for several sectors, due to various situations, with the crime that is affecting rural areas, coffee and sugar prices, on average it was not a good year'."

The situation denounced by employers is a continuation of the problem that has been going on for years, because according to the Legal and Institutional Situation Report, in the third quarter of 2017 it was reported that " ... corruption was the third obstacle to operation and growth of companies identified by the business people surveyed (5.5), outflanked in seriousness by crime (7.0) and low sales (5.6)."

See "Legal and Institutional Situation Report - 2nd Semester 2017".

More on this topic

El Salvador: Increasing Insecurity and Decaying Business Climate

February 2016

Warnings have been given over increased insecurity, stagnation in the fight against corruption, and little capacity for Government dialogue in the second half of 2015.

The adoption of higher taxes without a dialogue, the consequences for the country of the increase in homicides from 10 to 18 a day in 2015, and stagnation in the fight against corruption, were highlighted in the evaluation made by the Salvadoran Foundation for Economic and Social Development ( Fusades) regarding the legal and institutional framework of the country during the second half of 2015.

El Salvador Needs a Government That Encourage Investment

August 2013

One of the reasons for the poor performance of the Salvadoran economy is the uncertainty about political behavior at every election.

This was stated by Director of Economic and Social Affairs of the National Association of Private Enterprise (ANEP), Waldo Jimenez, who added that "...

The Salvadoran Economy in the Fourth Quarter 2010

February 2011

FUSADES published a Situation Report for the period from October to December 2010.

The report highlights the slower growth of the Salvadoran economy compared to its regional partners, signaling the main causes for the lack of recovery: bad investment climate, political and economic uncertainty and insecurity.

Salvadoran Economy: First Quarter 2010

May 2010

FUSADES published its economic situation report for January March 2010; it highlights crime as the main issue affecting economic recovery.

In its chapter on investment climate, the Foundation for Economic and Social Development of El Salvador (FUSADES), remarks that “businessmen feel that the country’s situation is still unfavorable for investing, a trend that has been sustained for the past two years.

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