El Salvador

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El Salvador Economy 2008

Economy - overview: The smallest country in Central America, El Salvador has the third largest economy, but growth has been modest in recent years. Robust growth in non-traditional exports have offset declines in the maquila exports, while remittances and external aid offset the trade deficit from high oil prices and strong import demand for consumer and intermediate goods. El Salvador leads the region in remittances per capita with inflows equivalent to nearly all export income. Implementation in 2006 of the Central America-Dominican Republic Free Trade Agreement (CAFTA), which El Salvador was the first to ratify, has strengthened an already positive export trend. With the adoption of the US dollar as its currency in 2001, El Salvador lost control over monetary policy and must concentrate on maintaining a disciplined fiscal policy. The current government has pursued economic diversification, with some success in promoting textile production, international port services, and tourism through tax incentives. It is committed to opening the economy to trade and investment, and has embarked on a wave of privatizations extending to telecom, electricity distribution, banking, and pension funds. In late 2006, the government and the Millennium Challenge Corporation signed a five-year, $461 million compact to stimulate economic growth and reduce poverty in the country's northern region through investments in education, public services, enterprise development, and transportation infrastructure.
GDP (purchasing power parity): $41.63 billion (2007 est.)
GDP (official exchange rate): $20.37 billion (2007 est.)
GDP - real growth rate: 4.7% (2007 est.)
GDP - per capita (PPP): $6,000 (2007 est.)
GDP - composition by sector: agriculture: 10.8% industry: 30.8% services: 58.4% (2007 est.)
Labor force: 2.913 million (2007 est.)
Labor force - by occupation: agriculture: 19% industry: 23% services: 58% (2006 est.)
Unemployment rate: 6.2% official rate; but the economy has much underemployment (2007 est.)
Household income or consumption by percentage share: lowest 10%: 0.7% highest 10%: 38.8% (2002)
Distribution of family income - Gini index: 52.4 (2002)
Investment (gross fixed): 16.1% of GDP (2007 est.)
Budget: revenues: $3.659 billion expenditures: $3.709 billion (2007 est.)
Public debt: 37.3% of GDP (2007 est.)
Inflation rate (consumer prices): 4.6% (2007 est.)
Commercial bank prime lending rate: NA
Stock of money: $1.802 billion (31 December 2007)
Stock of quasi money: $764.1 million (31 December 2007)
Stock of domestic credit: $9.729 billion (31 December 2007)
Agriculture - products: coffee, sugar, corn, rice, beans, oilseed, cotton, sorghum; beef, dairy products; shrimp
Industries: food processing, beverages, petroleum, chemicals, fertilizer, textiles, furniture, light metals
Industrial production growth rate: 3.4% (2007 est.)
Electricity - production: 5.338 billion kWh (2007 est.)
Electricity - consumption: 4.426 billion kWh (2007 est.)
Electricity - exports: 8.64 million kWh (2007 est.)
Electricity - imports: 11.08 million kWh (2007 est.)
Oil - production: 0 bbl/day (2005)
Oil - consumption: 44,330 bbl/day (2006 est.)
Oil - exports: 4,963 bbl/day (2006)
Oil - imports: 45,210 bbl/day (2006)
Oil - proved reserves: 0 bbl (1 January 2006 est.)
Natural gas - production: 0 cu m (2007 est.)
Natural gas - consumption: 0 cu m (2007 est.)
Natural gas - exports: 0 cu m (2007 est.)
Natural gas - imports: 0 cu m (2007 est.)
Natural gas - proved reserves: 0 cu m (1 January 2006 est.)
Current account balance: -$1.119 billion (2007 est.)
Exports: $4.035 billion (2007 est.)
Exports - commodities: offshore assembly exports, coffee, sugar, shrimp, textiles, chemicals, electricity
Exports - partners: US 51%, Guatemala 13.6%, Honduras 11.2%, Nicaragua 5.5% (2007)
Imports: $8.108 billion (2007 est.)
Imports - commodities: raw materials, consumer goods, capital goods, fuels, foodstuffs, petroleum, electricity
Imports - partners: US 35.7%, Mexico 9.8%, Guatemala 8.5%, China 4.7% (2007)
Reserves of foreign exchange and gold: $2.199 billion (31 December 2007 est.)
Debt - external: $9.574 billion (December 2007)
Stock of direct foreign investment - at home: $5.918 billion (2007 est.)
Stock of direct foreign investment - abroad: $384 million (2007 est.)
Market value of publicly traded shares: $3.623 billion (2005)
Currency (code): US dollar (USD)
Exchange rates: the US dollar became El Salvador's currency in 2001

NOTE: The economy information regarding El Salvador on this page is re-published from the 2008 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of El Salvador Economy 2008 information contained here. All suggestions for corrections of any errors about El Salvador Economy 2008 should be addressed to the CIA.