Second-quarter GDP grew by only 1.4 per cent, according to the Central Reserve Bank.
The Ministry of Economy (Minec) maintains firm that the Salvadoran gross domestic product (GDP) will grow by 3.5 per cent at the end of 2024, despite the tenuous results of the second quarter economy revealed in September by the Central Reserve Bank (BCR).
Because of the challenges facing the world, we are cautious about the projections, we would expect that this year we would be reaching 3.5 %, said the Minister of Economy, María Luisa Hayem.
According to the official, the improvement in the business climate and in the performance of Salvadoran bonds in the stock market will contribute to achieving the growth rate projected by 2024.
Minec said that the forecasts remain at a growth of about 3 % for the next few years and that they will work to concrete them.
Results
The BCR revealed that GDP grew only one1.4 % during the second quarter of 2024,The lowest rate since 2020, when the country entered a crisis linked to the covine-19 pandemic.
Second-quarter growth slowed in the first months of the year, when the economy expanded by 3 per cent. If the trend continues, the country runs the risk of not reaching the projection set by the BCR of between 3 % and 3.5 %.
On Thursday, the World Bank (WB) lowered growth forecasts from 3.2 per cent to a2.9 % for this year.
This after the multilateral body improved the projection of 2.3 per cent in June, which it anticipated at the beginning of the year, at 3.2 %.
The WB’s chief economist for Latin America and the Caribbean, William Maloney, said that, together with Costa Rica and the Dominican Republic, El Salvador has an “enormous potential” of growth, something that must be tied to the attraction of near-shoring opportunities.
Investments
According to the Minister of Economy, El Salvador will register more investments in the coming months, mainly in the textile, tourism and vehicle sectors.
The official said that investments in the services sector have reported a 30 percent growth, pushed by the tourism sector.
The government points out that the sectors that invest in the country are diversifying, for example, it indicated that there are companies that are already in the country are driving projects in other areas or expanding their operations.