The Free Trade Agreement between the Asian nation and El Salvador will enter into force on January 1 of next year, and the value traded between the two economies is expected to increase in the future.
After two years of negotiation, the treaty in question was signed in February 2018 by El Salvador.
In its latest update of economic growth projections for 2019, ECLAC estimates that the Dominican Republic will close the year with a 5% increase, followed by Panama, which would reach a growth rate of 3.7%.
According to economic growth projections for Latin America, which were estimated by the Economic Commission for Latin America (ECLAC) and updated in November, the Dominican Republic will be the country in the region that will increase its production the most this year.
For the IMF, the Salvadoran authorities are dealing firmly with crime and corruption and are beginning to improve the business environment in order to support economic growth.
In 2019, real GDP growth is expected to be 2.5% as a result of the solid confidence of the business sector, reported the International Monetary Fund (IMF) after its visit to El Salvador.
Except for Nicaragua, which projects a decline in revenues, Fitch Ratings estimates that by year-end the region's insurance markets will have grown from 3% to 8%.
According to the report Perspectives of Insurance Industry in Central America, prepared by the rating agency Fitch Ratings, El Salvador will be the market that in 2019 will register more dynamism in the region, reporting an 8% increase over revenues reported in 2018.
Generating a positive perception of the country, improving the relationship with the U.S. government and taking control of the penal centers are some of the actions highlighted by the business sector of El Salvador, regarding the first 100 days of the Bukele administration.
The Index of Business Confidence in El Salvador registered a considerable rise to 130.8 in July 2019, being the second highest figure in the entire series since 2005.
The businessmen interviewed are perceiving an improvement in the business climate, driven by the arrival of the new government team in the Executive Branch (since June 2019), which is implementing changes in certain public policies, reported the Salvadoran Foundation for Economic and Social Development (Fusades).
Last year, bottled water sales in Costa Rica were estimated at $89 million and they are expected to increase up to $106 million in 2023, a behavior explained by the downward trend in the consumption of carbonated beverages.
Although companies such as Florida Ice & Farm Co (Fifco) and Coca Cola Femsa have the opportunity to grow in the Costa Rican market, they will also face competition from new entrants such as Premium Brands.
Faced with the threat of a global economic slowdown and the possibility of the U.S. entering recession next year, businessmen in the region argue that to mitigate possible adverse effects, it is key to diversify export destinations.
Market analysts assure that the slowdown in U.S. economic activity is already a reality, and that what is still not clear, is the possibility that the economy will go into recession next year. The recent reversal of the U.S. bond curve, which historically has been the signal that warns of a recession in the short term, may not mean the same on this time, say some U.S. brokerage firms.
Although in the first half of the year sales abroad reported a slight decrease of 0.4% over the same period in 2018, the business sector in El Salvador expectsexports to rebound in the remainder of the year.
Exports from El Salvador up to June of this year registered a total of $3,033.9 million, with a reduction of $13.6 million, compared to the same period in 2018, when the total amounted to $3,047.4 million, informed the Central Reserve Bank.
In the last ten years, the sector has grown by an average of 2% per year, which for businessmen reflects that the country has not managed to get out of the "low growth trap."
The Salvadoran Association of Industrialists (ASI), faced with the departure of the current government, analyzed the economic and industrial situation in the country in the 2009-2019 period and set out the prospects of industrialists for the new government.
For the international organization, El Salvador's banking sector is well capitalized and is optimistic about the recent progress made in the area of cross-border banking supervision.
In order to further enhance the resilience of the banking sector, the authorities were encouraged to pass the bank resolution law, strengthen the emergency liquidity assistance framework, and ensure full compliance with the risk-based supervisory framework, among others, of the International Monetary Fund (IMF) after concluding its last visit to the country.
For the IMF, the political agreements reached by the elected government in El Salvador with the parties that dominate the Legislative Assembly will be crucial for the successful implementation of a country agenda.
The IMF staff team visited San Salvador during March 11—22 for the 2019 Article IV consultation and held candid discussions with the current authorities, the President-elect, parliamentarians, business community, and social partners.
Low productivity, climate vulnerability and the variation of international prices are part of the challenges faced by agricultural producers in Central America and the Dominican Republic.
The Inter-American Development Bank (IDB) published the study "Facing External Challenges, Internal Strengths: The Economic Environment of Central America and the Dominican Republic", which analyzes the current situation in the region and its 2019 outlook.
The pessimism expressed by consumers in Costa Rica and the constant deterioration of business expectations in Guatemala reflect part of the complex challenges faced by Central American economies this year.
A report prepared by the School of Statistics of the University of Costa Rica (UCR) shows the negative trend that come showing the economic expectations, because between February 2018 and the same month of 2019, the Consumer Confidence Index (ICC) fell 15%.
Improving trust between the public sector and businessmen, and recovering the productivity of the economy, are some of the challenges facing the administration of President-elect, Nayib Bukele.
After last February 3, the candidate of the Gana party, Nayib Bukele, won the first round of presidential elections in El Salvador, the business sector anticipates the challenges of the new administration.
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