El Salvador

Historically reliant on coffee exports, this nation of approximately 6.4 million, the smallest in Central America, has made strides in diversifying its economy by focusing on growth areas such as tourism, construction, retail and energy. In addition, its strategic proximity to the United States not only serves as a competitive advantage in terms of trade and investment opportunities but also as a significant source of revenue through expatriate remittances.

However, over the past three decades, due to the pervasiveness of gang-related activity, El Salvador has struggled behind its regional peers in attracting foreign investment. Despite recent security improvements, this had yet to translate into substantial new inflows. The country confronts a host of other challenges, including chronic fiscal deficits, inadequate infrastructure, widespread inequality and a scarcity of skilled labor. Additionally, the use of theU.S. dollar as the primary official currency and the lack of control over its monetary policy make El Salvador vulnerable to external economic shocks. The introduction of Bitcoin as an alternative legal tender in 2021 yielded mixed results.