IMF Staff Country Reports

El Salvador: Request for Extended Arrangement Under the Extended Fund Facility-Press Release; Staff Report; and Statement by the Executive Director for El Salvador

March 3, 2025

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Format: Chicago

International Monetary Fund. Western Hemisphere Dept. "El Salvador: Request for Extended Arrangement Under the Extended Fund Facility-Press Release; Staff Report; and Statement by the Executive Director for El Salvador", IMF Staff Country Reports 2025, 058 (2025), accessed April 17, 2025, https://doi.org/10.5089/9798229003483.002

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Summary

El Salvador has recovered well from the pandemic, supported by robust remittances and buoyant tourism flows, amid a sharp improvement in the country’s security situation. Inflation has fallen and the external imbalances have narrowed more recently, consistent with a gradual improvement in public finances and favorable terms of trade. In this context, sovereign spreads have come down sharply with recent debt buyback operations helping to ease near-term external financing needs. Despite recent progress, El Salvador’s macroeconomic imbalances remain significant, stemming from high fiscal deficits and debt, as well as low external and financial buffers, in the context of dollarization. Meanwhile, underlying productivity remains low, reflecting in part persistent social and infrastructure gaps, as well as a legacy of weak governance and transparency, which have discouraged investment. The Bukele administration is intent on focusing its second mandate on addressing pending macroeconomic and structural challenges and boosting economic growth, under an IMF-supported program.

Subject: Anti-money laundering and combating the financing of terrorism (AML/CFT), Crime, Economic sectors, Expenditure, Pension spending, Public debt, Public sector

Keywords: Anti-money laundering and combating the financing of terrorism (AML/CFT), Audited financial statements, Bitcoin transparency, Caribbean, Central America, Global, List of statement, Pension spending, Public sector, Publication of asset declaration, Staff appraisal

Publication Details

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