The Central Bank reports that the 692 companies have more than 13 years of export experience and are the main sales generators.
84.8 per cent of Salvadoran exports are generated by companies with more than 13 years of experience, revealed a study of the elasticity of foreign trade of the Central Reserve Bank (BCR).
After remittances, exports of goods are the main foreign exchange generator in the Salvadoran economy with a share of 22.6 per cent of gross domestic product (GDP) in the second quarter of 2024. In addition, they are a photograph of the economic dynamics and job-creating.
The BCR study evaluated the dynamics of exports of goods without maquila within international merchandise trade from 2010 to 2022 in the main five sales destinations: the United States, Guatemala, Honduras, Nicaragua and Costa Rica, which represented 83.3 % in 2022.
According to the report, 84.8 percent of exports in the 13 years analyzed correspond to products produced by companies that have 13 years or more of experience, where 692 signatures are registered.
The time it has been exporting a company largely determines the export result, given by the greatest experience. Less are learning costs, they have less uncertainty, better marketing practices, they have more contacts, the Central Bank says in the report.
The research also found that 48.3 percent of the average amount exported over the past decade came from foreign capital companies. The contribution in the export basket increased between 2018 and 2019, when they accounted for 50.4 percent of the total.
What do exports depend on?
Even with experience, the BCR noted that the main determinants of exports are the performance of GDP of the trading partners of Central America and the United States, as well as relative prices.
This is reflected in this year’s export results, when shipments of Salvadoran goods accumulate a contraction of 5 percent after adding $4,319.4 million from January to August, at least $228.2 million less than in 2023.
This fall is explained by the exporters’ guild due to lower demand from buyers in the United States, where 34 per cent of the goods were directed in the first eight months of the year.
The document explains that elasticity is key to identifying obstacles in international trade. Thus, the study found that the elasticity of export earnings is 1.2 in direct relation to the growth of trading partners, while in relation to commodity prices it is -0.5.
The Central Bank recalled that a study of its 2021 research area revealed that large companies are the main generators of exports, with a share of 92.5 % in 2020, while the media contributed 4.8%, the small 2.4 % and micro-enterprises only 0.3%.
This article has been translated after first appearing in Diario El Mundo