Lack of private sector confidence in the government and excessive bureaucracy prevented greater investments being made in this industry during 2013.
The construction industry describes 2013 as a year of stagnation, it is estimated that the Gross Domestic Product (GDP) of the sector will be 0% even though the previous year it closed at -2.4%. "We are closing the year without any growth," said Carlos Guerrero, president of the Salvadoran Chamber of the Construction Industry (Casalco).
An act to streamline procedures intends to reduce the bureaucratic time delay to 120 days, so that construction companies can dynamize the economy with new buildings.
Currently the number formalities required for a construction project is 18.
Elmundo.com.sv reports that "Carlos Guerrero, president of the Salvadoran Chamber of the Construction Industry (Casalco), who also served as environment minister between 2004 and 2009, indicated that this delay makes the country less competitive and will increase costs unnecessarily. "
The goal of the Government of El Salvador is to reduce fom the current 880 days to 120 days the period for obtaining a building permit.
This project is part of a new proposal that the government will present to the Legislature next week and aims to encourage private investment.
Ismael Nolasco, director of the Chamber of Construction, said if successful, the initiative will have a positive impact on the sector, generating interest from foreign investors. "This really is going to impact on investment. An investor who comes to the country and says, 'I want to build three warehouses', and realize that in order to start building it will take three years, leaves."
The Salvadoran construction sector has proposed a way to revive the sector, creating a single desk for faster approval of building permits.
Mario Rivera, president of the Chamber of Construction (CASALCO) noted that in this way the current waiting time could be reduced from almost two years to ninety days.
"The hard work that a company has to do visiting so many institutions to obtain a permit is an obstacle to investment", added the executive director of CASALCO, Ismael Nolasco in an article in Elsalvador.com
The procedures for obtaining an environmental permit now require between 6 months and 2 years; they could be shortened to 60 days.
Ismael Nolasco, from the Salvadoran Chamber of Construction (CASALCO), remarked they have held talks with the Environment Ministry and agreed on a new scheme that will come into effect this week.
He told newspaper La Prensa Gráfica that “for the time being, a special counter will be put in place for builders to present their projects. Nolasco remarked that by ‘defining clear rules’ constructors will be able to submit all the required paperwork in one shot, so they are not asked for additional requirements later”.