IMF Executive Board Concludes the Second and Third Reviews Under the Extended Fund Facility for El Salvador

IMF News, October 1, 2026

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IMF Executive Board Concludes the Second and Third Reviews Under the Extended Fund Facility for El Salvador

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Bibliographic details

• Published: October 1, 2026

Key outcomes

• The Executive Board of the International Monetary Fund (IMF) completed the Second and Third Reviews under El Salvador’s Extended Fund Facility (EFF) arrangement, allowing for an immediate disbursement of SDR 101.96 million (about US$138 million).
• El Salvador’s 40‑month EFF arrangement was approved on February 26, 2025, with total access equivalent to SDR 1,033.92 million (about US$1.4 billion).
• The authorities consented to the publication of the Staff Report.

Economic performance and outlook

• Economic activity has exceeded expectations, supported by sustained improvements in security and rising investor confidence, while macroeconomic imbalances are being addressed.
• Projections and recent estimates (Est./Proj.):
  • Real GDP growth (percent): 11.9 (2021), 2.9 (2022), 3.4 (2023), 2.6 (2024), 3.9 (2025), 4.5 (2026), 4.0 (2027).
  • Consumer price inflation (average, percent): 3.5 (2021), 7.2 (2022), 4.0 (2023), 0.9 (2024), 0.3 (2025), 2.7 (2026), 2.1 (2027).
  • GDP Deflator (percent): 4.1 (2021), 6.6 (2022), 1.9 (2023), 1.3 (2024), 1.3 (2025), 2.7 (2026), 2.0 (2027).
  • Nominal GDP (billions of US$): 29.0 (2021), 31.9 (2022), 33.6 (2023), 34.9 (2024), 36.7 (2025), 39.4 (2026), 41.8 (2027).
• External sector indicators:
  • Current account balance: -4.3 (2021), -6.7 (2022), -1.7 (2023), -2.8 (2024), -3.5 (2025), -4.8 (2026), -3.0 (2027).
  • Trade balance: -27.3 (2021), -30.0 (2022), -26.4 (2023), -27.2 (2024), -30.3 (2025), -31.3 (2026), -28.9 (2027).
  • Transfers (net): 26.1 (2021), 24.5 (2022), 24.4 (2023), 24.1 (2024), 27.3 (2025), 26.1 (2026), 25.0 (2027).
  • Foreign direct investment (net): -1.3 (2021), -0.4 (2022), -2.4 (2023), -2.1 (2024), -1.2 (2025), -1.7 (2026), -1.9 (2027).
  • Gross international reserves (mill. of US$): 3,426 (2021), 2,696 (2022), 3,081 (2023), 3,706 (2024), 4,814 (2025), 5,346 (2026), 6,172 (2027).

Fiscal consolidation and public finances

• Fiscal consolidation has advanced broadly in line with program objectives; liquidity and reserve buffers have strengthened and reserve and liquidity targets were comfortably met.
• Nonfinancial public sector indicators:
  • Overall balance: -5.5 (2021), -2.7 (2022), -4.7 (2023), -4.6 (2024), -2.9 (2025), -2.3 (2026), -7.7 (2027).
  • Primary balance: -1.0 (2021), 2.0 (2022), -0.1 (2023), 0.0 (2024), 1.9 (2025), 2.9 (2026), 3.7 (2027).
  • Of which: tax revenue: 19.9 (2021), 20.4 (2022), 20.3 (2023), 21.2 (2024), 21.9 (2025), 22.8 (2026), 22.9 (2027).
  • Gross debt (nonfinancial public sector, including CIP-A pension bonds): 88.0 (2021), 83.7 (2022), 83.9 (2023), 87.7 (2024), 87.6 (2025), 85.0 (2026), 89.2 (2027).
  • Note: In 2027, figures include the recognition of accrued but unpaid interest to private pension funds (US$2.3bn).

Financial sector, governance, and transparency reforms

• Important progress achieved in:
  • Financial sector reforms and financial resilience.
  • Fiscal transparency and public-sector reporting improvements.
  • AML/CFT reforms.
  • Transfer of majority ownership and control of the government e-wallet Chivo to a private operator.
• Areas requiring ongoing attention:
  • Strengthening oversight and regulation of financial institutions, including cooperatives and public financial institutions.
  • Further reducing the sovereign‑bank nexus and implementing safeguards assessment recommendations, including modernization of the central bank’s organic law.
  • Improving the quality and timeliness of external sector statistics.
  • Enhancing beneficial ownership transparency, asset-declaration disclosures, and anti-corruption effectiveness.

Bitcoin and crypto‑asset policy

• Efforts are underway to reduce the state’s involvement in Bitcoin-related activities and to strengthen the regulation and oversight of crypto assets.
• Specific program signals and measures:
  • The transfer of majority ownership and control of Chivo to a private operator has been completed; residual public-sector exposure should be fully unwound.
  • No further Bitcoin accumulation is envisaged beyond the documented donations; waivers were granted for certain unmet performance criteria on Bitcoin accumulation based on corrective measures and renewed commitments.
  • Priority actions include enhancing transparency and disclosure of public-sector crypto-asset holdings, improving regulatory, supervisory, and governance frameworks for crypto asset providers, and amending the Digital Asset Issuance Law as appropriate.

Board statement — priorities and policy recommendations (Mr. Dan Katz, First Deputy Managing Director and Chair)

• The IMF-supported economic program has delivered tangible benefits; authorities remain committed at the highest level to achieving program objectives.
• Sustaining progress requires decisive and timely program implementation and strong contingency planning amid heightened external uncertainty.
• Fiscal policy priorities:
  • Sustained fiscal consolidation to place public debt on a downward trajectory and safeguard the debt anchor.
  • Achieving higher primary surpluses through further enhancements in revenue administration, continued expenditure restraint, and timely pension and civil service reforms.
  • Rebuilding government liquidity buffers and improving treasury and debt-management operations to avoid future slippages.
  • Protecting priority social spending to support poverty reduction.
• External and financial stability priorities:
  • Continued reserve accumulation and efforts to sustain bank liquidity buffers.
  • Strengthened oversight and regulation of financial institutions to allow prudent private credit expansion.
  • Implementation of remaining safeguards assessment recommendations to support financial stability.
• Governance and growth priorities:
  • Continued efforts to strengthen governance, transparency, and the business climate to attract investment and support inclusive, private sector‑led growth.
  • Addressing infrastructure and skills gaps to build resilience and sustain stronger, more inclusive growth.
• Crypto priorities reiterated:
  • Unwind state involvement in Bitcoin-related activities, enhance disclosure of public-sector crypto-asset holdings, and strengthen crypto-asset regulatory and governance frameworks.

Selected social and macroeconomic indicators (snapshot)

• Rank in UNDP Development Index 2023 (of 193): 132.
• Population (million, 2025): 6.4.
• Per capita income (U.S. dollars, 2025): 5,751.
• Life expectancy at birth in years (2024): 72.
• Percent of pop. below poverty line (2025): 24.3.
• Gini index (2023): 40.
• Credit to the private sector (percent of GDP): 61.1 (2021), 62.6 (2022), 62.4 (2023), 63.4 (2024), 64.4 (2025), 68.0 (2026), 68.1 (2027).
• Broad money (percent of GDP): 60.9 (2021), 58.0 (2022), 60.0 (2023), 59.7 (2024), 64.2 (2025), 65.8 (2026), 66.3 (2027).
• Interest rate (time deposits, percent): 4.1 (2021), 4.5 (2022), 5.3 (2023), 5.6 (2024), … (2025), … (2026), … (2027).
• Gross capital formation (percent of GDP): 23.4 (2021), 24.5 (2022), 21.5 (2023), 20.1 (2024), 26.3 (2025), 28.2 (2026), 27.9 (2027).
• Private fixed investment (percent of GDP, excludes changes in inventories): 21.0 (2021), 18.3 (2022), 19.3 (2023), 20.2 (2024), 24.1 (2025), 24.5 (2026), 24.4 (2027).
• Net Foreign Assets of the Financial System (Millions of U.S. dollars): 3,424 (2021), 1,870 (2022), 1,854 (2023), 2,392 (2024), 4,467 (2025), 4,921 (2026), 5,585 (2027).