 RESTRICTED  
  
WT/TPR/S/440  
21 February  2023 
(23-1050) Page: 1/150 
Trade Policy Review Body   
 
  
TRADE POLICY REVIEW  
REPORT BY THE SECRETARIAT  
EL SALVADOR  
This report, prepared for the fifth Trade Policy Review of El Salvador, has been drawn up by the 
WTO Secretariat on its own responsibility. The Secretariat has, as required by the Agreement 
establishing the Trade Policy Review Mechanism (Annex 3 of the Marrakesh Agreement Establishing 
the World Trade Organization), sought clarification from El Salvador on its trade policies and 
practices.  
 
Any technical questions arising from th is report may be addressed to Mr Angelo Silvy 
(Tel. 022 739 5249), Ms Martha Lara ( Tel. 022 7396033) and Mr Ferrán Mercadé 
(Tel. 022 739 6026).  
 
Document WT/TPR/G/440 contains the policy statement submitted by El Salvador.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on El Salvador. This report was drafted 
in Spanish.  
  WT/TPR/S/440  • El Salvador  
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  CONTENTS  
SUMMARY  ................................ ................................ ................................ ........................  7 
1  ECONOMIC ENVIRONMENT  ................................ ................................ .........................  13 
1.1  Main features of the economy  ................................ ................................ .....................  13 
1.2  Recent economic developments  ................................ ................................ ...................  15 
1.2.1  The real sector  ................................ ................................ ................................ ....... 15 
1.2.2  Fiscal policy  ................................ ................................ ................................ ...........  17 
1.2.3  Monetary and exchange rate policy  ................................ ................................ ...........  20 
1.2.4  Balance of payments  ................................ ................................ ...............................  23 
1.3  Developments in trade and investment  ................................ ................................ .........  25 
1.3.1  Trends and patterns in merchandise and services trade  ................................ ................  25 
1.3.1.1   Merchandise trade  ................................ ................................ ................................  25 
1.3.1.1.1   Composition of merchandise trade  ................................ ................................ ....... 25 
1.3.2  Direction of trade  ................................ ................................ ................................ .... 26 
1.3.2.1   Trade in services  ................................ ................................ ................................ .. 29 
1.3.3  Trends and patterns in foreign direct investment  ................................ .........................  30 
2  TRADE AND INVESTMENT REGIMES  ................................ ................................ ...........  33 
2.1  General framework  ................................ ................................ ................................ .... 33 
2.2  Trade policy formulation and objectives  ................................ ................................ ........  34 
2.3  Trade agreements and arrangements  ................................ ................................ ...........  36 
2.3.1  WTO ................................ ................................ ................................ .....................  36 
2.3.2  Regional and preferential agreements  ................................ ................................ ........  36 
2.3.3  Other agreements and arrangements  ................................ ................................ .........  38 
2.4  Investment regime  ................................ ................................ ................................ .... 38 
3  TRADE POLICIES AND PRACTICES BY MEASURE  ................................ .........................  43 
3.1  Measures directly affecting imports  ................................ ................................ ..............  43 
3.1.1  Customs procedures and requirements, and customs valuation  ................................ ..... 43 
3.1.1.1   Customs procedures and requirements  ................................ ................................ .... 43 
3.1.1.2   Trade facilitation  ................................ ................................ ................................ .. 46 
3.1.1.3   Customs valuation  ................................ ................................ ...............................  48 
3.1.2  Rules of origin  ................................ ................................ ................................ ........  49 
3.1.3  Tariffs  ................................ ................................ ................................ ...................  49 
3.1.3.1   Structure and levels  ................................ ................................ .............................  50 
3.1.3.2   Tariff bindings  ................................ ................................ ................................ ..... 52 
3.1.3.3  Preferential tariffs  ................................ ................................ ................................  53 
3.1.3.4   Tariff quotas  ................................ ................................ ................................ ........  53 
3.1.4  Other charges affecting imports  ................................ ................................ ................  54 
3.1.5  Import prohibitions, restrictions and licensing  ................................ .............................  56 
3.1.6  Anti-dumping, countervailing and safeguard measures  ................................ .................  58 
3.2  Measures directly affecting exports  ................................ ................................ ..............  59 WT/TPR/S/440  • El Salvador  
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  3.2.1  Customs procedures and requirements  ................................ ................................ ...... 59 
3.2.2  Export taxes and duties  ................................ ................................ ...........................  60 
3.2.3  Export prohibitions, restrictions, and licensing  ................................ .............................  60 
3.2.4  Export support and promotion  ................................ ................................ ..................  61 
3.2.4.1   VAT deduction and refund  ................................ ................................ .....................  61 
3.2.4.2   Free zones and inward processing warehouses  ................................ .........................  61 
3.2.4.3   Law on International Services  ................................ ................................ ................  64 
3.2.4.4   Export promotion  ................................ ................................ ................................ . 66 
3.2.5  Export finance, insurance, and guarantees  ................................ ................................ . 67 
3.3  Measures affecting production and trade  ................................ ................................ ....... 68 
3.3.1  Incentives  ................................ ................................ ................................ .............  68 
3.3.1.1   BANDESAL  ................................ ................................ ................................ ..........  68 
3.3.1.2   Support to micro -, small and medium -sized enterprises  ................................ .............  70 
3.3.1.3   Sector -specific incentives  ................................ ................................ ......................  72 
3.3.2  Standards and other technical requirements  ................................ ...............................  72 
3.3.3  Sanitary and phytosanitary measures  ................................ ................................ ........  75 
3.3.4  Competition policy and price controls  ................................ ................................ .........  79 
3.3.4.1   Competition policy  ................................ ................................ ...............................  79 
3.3.4.2   Price controls  ................................ ................................ ................................ ...... 81 
3.3.5  State trading, state -owned enterprises, and privatization  ................................ .............  82 
3.3.6  Government procurement  ................................ ................................ ........................  82 
3.3.6.1   Overview  ................................ ................................ ................................ ............  82 
3.3.6.2   Regulatory framework  ................................ ................................ ..........................  83 
3.3.7  Intellectual property rights  ................................ ................................ .......................  86 
3.3.7.1   Overview  ................................ ................................ ................................ ............  86 
3.3.7.2   Institutional and legislative framework  ................................ ................................ .... 87 
3.3.7.3   Enforcement ................................ ................................ ................................ ........  92 
4  TRADE POLICIES BY SECTOR  ................................ ................................ ......................  95 
4.1  Agriculture, Forestry, and Fisheries  ................................ ................................ ..............  95 
4.1.1  Features  ................................ ................................ ................................ ................  95 
4.1.2  Agricultural policy  ................................ ................................ ................................ ... 96 
4.1.2.1   Institutional framework  ................................ ................................ .........................  96 
4.1.2.2   Legal framework  ................................ ................................ ................................ .. 97 
4.1.3  Policy instruments  ................................ ................................ ................................ .. 98 
4.1.3.1   Border measures  ................................ ................................ ................................ . 98 
4.1.4  Domestic support  ................................ ................................ ................................ . 100 
4.1.5  Fisheries and aquaculture  ................................ ................................ ......................  102 
4.1.5.1   Features  ................................ ................................ ................................ ...........  102 
4.1.5.2   Legal and institutional framework  ................................ ................................ .........  102 
4.2  Mining and energy  ................................ ................................ ................................ ... 103 WT/TPR/S/440  • El Salvador  
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  4.2.1  Mining  ................................ ................................ ................................ .................  103 
4.2.2  Energy  ................................ ................................ ................................ ................  104 
4.2.2.1   Electricity ................................ ................................ ................................ ..........  105 
4.2.2.2   Hydrocarbons  ................................ ................................ ................................ .... 107 
4.3  Manufacturing  ................................ ................................ ................................ .........  108 
4.4  Services  ................................ ................................ ................................ .................  110 
4.4.1  Multilateral commitments  ................................ ................................ .......................  110 
4.4.2  Financial services  ................................ ................................ ................................ .. 110 
4.4.2.1  Overview  ................................ ................................ ................................ ..........  110 
4.4.2.2   Banking  ................................ ................................ ................................ ............  113 
4.4.2.3   Insurance  ................................ ................................ ................................ .........  116 
4.4.2.4   Securities market  ................................ ................................ ...............................  118 
4.4.3  Telecommunications  ................................ ................................ ..............................  120 
4.4.3.1   Main features  ................................ ................................ ................................ .... 120 
4.4.3.2   Institutional and regulatory framework  ................................ ................................ .. 121 
4.4.3.3   Digital Agenda and technological innovation programmes  ................................ ........  123 
4.4.4  Transport  ................................ ................................ ................................ ............  124 
4.4.4.1   Main features  ................................ ................................ ................................ .... 124 
4.4.4.2   Maritime transport and ports  ................................ ................................ ...............  125 
4.4.4.3   Air transport ................................ ................................ ................................ ...... 127 
4.4.4.4   Land transport  ................................ ................................ ................................ ... 129 
4.4.5  Tourism  ................................ ................................ ................................ ...............  130 
5  APPENDIX TABLES  ................................ ................................ ................................ ... 134 
 
CHARTS  
 
Chart 1.1  Non-maquila  merchandise trade, by main products, 2016 and 2021  ..........................  27 
Chart 1.2 Trade in maquila  goods, by main products, 2016 and 2021  ................................ ...... 28 
Chart 1.3 Merchandise trade, by trading partner, 2016 and 2021  ................................ ............  29 
Chart 3.1 Frequency distribution of tariff rates, as at 1  January  2022 ................................ ...... 51 
Chart 3.2 Flow chart for the drafting of technical regulations  ................................ ..................  75 
 
TABLES  
 
Table 1.1 Main economic indicators 2016 -22 Q3  ................................ ................................ ... 13 
Table 1.2 Consolidated central government financial account, 2016 -22 Q3  ...............................  19 
Table 1.3 Balance of payments, 2016 -22 Q3  ................................ ................................ ........  23 
Table 1.4 Balance of trade in services, 2016 -22 Q3  ................................ ...............................  30 
Table 1.5 Balance of foreign direct investment by recipient economic sector 2016 -22 Q3 ............  30 
Table 1.6 Balance of foreign d irect investment, by origin 2016 -22 Q3 ................................ ...... 31 WT/TPR/S/440  • El Salvador  
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  Table 2.1 Trade agreements negotiated by El Salvador, 2016 -22 ................................ ............  37 
Table 2.2 Term of legal stability contracts  ................................ ................................ ............  41 
Table 3.1 Import declarations by type of clearance procedure, 2016 -21 ................................ ... 45 
Table 3. 2 Average clearance times at El Salvador's border posts, 2021  ................................ .... 47 
Table 3.3 MFN tariff structure, 2015 and 2022  ................................ ................................ ..... 50 
Table 3.4 Brief analysis of the MFN tariff, as at 1  January  2022 ................................ ..............  51 
Table 3.5 Analysis of preferential tariffs, as at 1  January  2022................................ ................  53 
Table 3.6 Taxes on specific products, 2022  ................................ ................................ ..........  55 
Table 3.7 Tax rates under the special tax on fue l ................................ ................................ .. 56 
Table 3.8 Prohibited imports and imports reserved for the State, 2022  ................................ .... 57 
Table 3.9 Goods subject to import permits, authorizations or approval, 2022  ............................  57 
Table 3.10 Exports subject to control, 2022  ................................ ................................ .........  61 
Table 3.11 Fiscal incentives in free zones and DPAs  ................................ ..............................  63 
Table 3.12 Main free zone and DPA regime indicators, 2015 -21 ................................ ..............  64 
Table 3.13 Law on International Services: eligible activities  ................................ ...................  65 
Table 3.14 Amount of export credit and guarantees, 2016 -21 ................................ .................  68 
Table 3.15 Lending rates applied by BANDESAL to financial intermediaries, 2022  ......................  69 
Table 3.16 FONDEPRO: support lines and main strategic sectors  ................................ .............  71 
Table 3.17 Act ivities of the Supervisory Authority for Competition, 2016 -21 .............................  81 
Table 3.18 Government procurement statistics by type and method,  2016-21 ..........................  82 
Table 3.19 Government procurement methods by threshold and procuring entity, 2022  .............  85 
Table 3.20 Intellectual property treaties signed by El  Salvador, 2022  ................................ ...... 86 
Table 3.21  Charges for the use of intellectual property 2016 -22Q1  ................................ ..........  87 
Table 3.22 Overview of El  Salvador's intellectual property legislation, 2022  ..............................  88 
Table 3.23 Applications and registra tions of trademarks, utility models and industrial 
designs, patents and the number of patents granted, 2017 -21 ................................ ...............  91 
Table 3.24. Border measures taken to protect IPRs, 2016 -22 ................................ .................  93 
Table 4.1 Principal indicators for t he agricultural sector (maquila excluded), 2016 -21 ................  95 
Table 4.2 Agricultural trade balance for El  Salvador (maquila excluded), 201 6-22Q3  ..................  96 
Table 4.3 Main agricultural sector laws, 2022  ................................ ................................ ....... 97 
Table 4.4 Main measures adopted in the agricultural sector as a result of the COVID -19 
pandemic  ................................ ................................ ................................ .......................  99 
Table 4.5 Installed capacity by source, 2016 and 2022  ................................ ........................  105 
Table 4.6 Value added in manufacturing, 2015-19 (most recent year available)  ......................  109 
Table 4.7 Main financial and money laundering laws, 2022  ................................ ...................  111 
Table 4.8 Principal amendments to financial laws, 2015 -22 ................................ ..................  112 
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  BOXES  
 
Box 1.1 The Bitcoin Law  ................................ ................................ ................................ .... 21 
Box 1.2 Technical standards to facilitat e the implementation of the Bitcoin  Law, 
August  2021 ................................ ................................ ................................ ...................  22 
Box 3.1 Benefits of investing in investment funds  ................................ ................................ . 72 
Box 3.2 Requirements for the registration of foreign foods and beverages  ................................  78 
 
APPENDIX TABLES  
 
Table A1. 1 Non-maquila merchandise exports by HS section and main HS chapter, 2016 -21
 ................................ ................................ ................................ ................................ ... 134 
Table A1. 2 Maquila exports by HS section and main HS chapter, 2016 -21 .............................  136 
Table A1. 3 Non-maquila merchandise imports by HS section and main HS chapter, 2016 -21
 ................................ ................................ ................................ ................................ ... 137 
Table A1. 4 Maquila imports by HS section and main HS chapter, 2016 -21 .............................  139 
Table A1. 5 Total merchandise exports by trading partner, 2016 -21ª ................................ ..... 140 
Table A1. 6 Total merchandise imports by trading partner, 2016 -21ª ................................ .... 141 
 
Table A2. 1 Notifications submitted to the WTO by El Salvador, 2016 -22 (30 September)  .........  142 
Table A2. 2 Bilateral agreements on the promotion and reciprocal protection of investment 
signed by El Salvado r, in force as at November 2022  ................................ ..........................  144 
 
Table A3. 1 Application of agricultural tariff quotas under trade agreements, as at 
1 January  2022 ................................ ................................ ................................ .............  145 
Table A3. 2 Main BANDESAL first -tier credit programmes  ................................ .....................  146 
Table A3. 3 Main BANDESAL second -tier credit programmes ................................ .................  147 
Table A3. 4 Main programmes of the E conomic Development Fund, BANDESAL  .......................  148 
Table A3. 5 Main Salvadoran Guarantee Fund (FSG) programmes  ................................ .........  150 
 
 
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  SUMMARY  
1. For most of the period under review (2016 -22), the Salvadoran economy continued to show 
positive real GDP growth rates, with an annual average of 2.4 % between 2016 and 2019. The 
Salvadoran economy was hit hard by the COVID -19 pandemic, which not only caused a drop in 
domestic activity, but also led to a substantial decline in foreign remittance inflows, a predominant 
source of financing for domestic dem and. Salvadoran real GDP shrank by 8.2 %. The pandemic 
caused both exports and imports of goods and services to fall sharply, by 21 % and 10.6 % in real 
terms, respectively. The Salvadoran economy recovered from the crisis caused by the pandemic in 
2021, when  real GDP growth reached 10.3 %. This substantial growth is the result of a recovery in 
domestic demand, stronger external demand and an increase in remittances, which accounted for 
26.1% of GDP in 2021. Exports and imports of goods and services recovered s teadily, up by more 
than 26 % in real terms from 2020 levels in both cases. The Salvadoran economy grew by 2.2 % in 
the first three months of 2022 and the real growth rate for the whole year is expected to reach  2.8%. 
2. The composition  of GDP expenditure in El  Salvador is still characterized by a high level of both 
private and public consumption. Total consumption was equivalent to 103.2 % of GDP in 2021, with 
private household consumption accounting for 83.4 % and public expenditure for 19.7 %. 
Remittances from a broad bankroll a large part of private consumption.  
3. The Fiscal Responsibility  Law for the Sustainability of Public Finances and Social Development 
(LRF) introduced, as of November  2016, a series of measures to achieve the consolidation and 
stability of pub lic finances, such as increasing the tax burden and limiting consumer spending. The 
LRF seeks to ensure long -term fiscal balance by setting primary balance targets, initially to reduce 
the debt -to-GDP ratio and then to keep it stable. As a result of these policies, the central government 
deficit remained relatively stable between 2016 and 2019, ranging from 1.9 % to 3.7 % of GDP. 
However, the deficit rose to 10.4 % of GDP in 2020, in the wake of the higher expenditure resulting 
from the implementation of measu res to deal with the pandemic. In 2021, while still reeling from 
the negative effects of the pandemic, the deficit was equivalent to 5.9 % of GDP.  
4. In an effort to cope with the COVID -19 pandemic, in April  2020, the Ministry of Finance was 
authorized to rais e up to USD  2 billion, and in May  2020, a further authorization was issued for an 
additional USD  1 billion. The principal fiscal and expenditure -related measures to counter the effects 
of the pandemic included, inter alia , a one -time subsidy of USD  300 to approximately 75 % of all 
households; the distribution of food baskets to affected families; a three -month deferral of utility 
payments; a three -month exemption from the special tourism tax for companies operating in the 
tourism sector; and the temporary el imination of duty on imports of essential medical and food 
products (medical textiles, disinfectants, flour, rice and beans). A series of measures were also 
implemented to facilitate access to credit and ease the financial burden on individuals and 
busines ses, such as reducing banks' reserve requirements and modifying provisions for bad loans. 
Moreover, a USD 650 million trust fund was set up to support workers and SMEs.  
5. The United States dollar is legal tender and the unit of account of the Salvadoran fina ncial 
system. As a dollarized economy El Salvador cannot conduct an independent monetary policy, and 
therefore the activities of the Central Reserve Bank of El Salvador  are chiefly limited to managing 
the liquidity reserve. El Salvador was the first countr y to introduce bitcoin as legal tender, in 
June 2021. According to the authorities, the aim of this initiative is to foster financial inclusion. To 
support bitcoin operations and assume part of the risk thereof, the Bitcoin Trust was set up, with a 
capital  of USD  150 million, and the digital wallet, Chivo Wallet, was created. Separate statistics 
regarding the use of bitcoin are not kept, as according to the Bitcoin Law the USD is the unit of 
account. It is therefore difficult to quantify its use. An estimat ed 4 million users avail themselves of 
the Chivo e -wallet.  
6. The balance -of-payments current account of El Salvador ran a growing deficit between 2016 
and 2018, which reached 3.3 % of GDP. In 2019, the deficit narrowed to 0.4 % of GDP. In 2020, as 
an effect of  the pandemic, both exports and imports of goods and services dropped, but imports fell 
by a larger proportion, resulting in a current account surplus equivalent to 0.8 % of GDP. In 2021, 
as the economy recovered, the current account deteriorated, running a t a deficit equivalent to 5.1 % 
of GPD; this situation worsened in 2022. The deficit in the balance of trade in goods grew between 
2016 and 2019, before  improving in 2020 as a result of the pandemic. However, it widened 
substantially in 2021, when it totalled USD  7,263  million, a trend that continued in 2022. Meanwhile, 
the services balance has been in surplus during the period under review. The current a ccount deficit WT/TPR/S/440  • El Salvador  
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  has continued to be offset by the high level of current transfers, mainly in the form of remittances 
from Salvadorans living abroad. Remittances from abroad reached USD  7,465  million in 2021, 
equivalent to 26 % of GDP. The balance -of-payments  financial account has run a deficit during the 
entire period under review, reflecting the rise in net borrowing. At 31  December  2021, the total 
foreign debt stock amounted to  USD 21,280  million (74 % of GDP). Net foreign direct investment 
(FDI) flows have averaged 2 % of GDP. The level of net international reserves was USD  2,941  million 
as of September  2022.  
7. Merchandise trade continued to increase during the period under review. Although it 
contracted in 2020 due to the pandemic, 2021 saw a strong recovery i n both maquila  imports and 
exports relative to the respective totals. Total trade (including maquila ) reached 
USD 21,704.7  million in 2021, equivalent to just over two thirds of GDP. Cumulative Salvadoran 
exports reached USD  5,688.9  million by September  2022, exceeding the same period in 2021 by 
15.4%. Merchandise imports as of September  2022 totalled USD  13,488.2  million, exceeding the 
same period in 2021 by 24.4 %. The structure of El Salvador's exports did not change substantially 
between 2016 and 2021, a s textiles and apparel continued to account for the largest share, 
equivalent to around one third of total exports, excluding maquila  exports, and almost 70 % in the 
case of maquila  exports. Regarding imports, manufactured products account for one third of the 
total, and consist primarily of machinery, transport equipment, textiles, plastics and chemicals. 
El Salvador's main export markets (excluding maquila exports) continue to be the other members 
of the Central American Common Market (CACM) and the United  States. The United States continues 
to be El Salvador's main supplier of imported goods, followed by China, Guatemala and Mexico.  
8. The surplus in the balance of the trade in goods increased gradually during the period under 
review, reaching 4.8 % of GDP in 2019. The largest surpluses were under the "travel" item and in 
the value added of maquila  activities. After shrinking in 2020, the surplus grew again in 2021, mainly 
due to an increase in loans to the maquila  industry. The stock of foreign inve stment in El Salvador 
reached USD  10,378.3  million by the end of 2021. Net flows of FDI during the review period were, 
on average, USD  548.8  million per year.  
9. El Salvador has been a Member of the WTO since 7 May1995 and grants at least 
most-favoured -nation  (MFN) treatment to all its trading partners. This is its fifth trade policy review. 
El Salvador ratified the WTO Trade Facilitation Agreement (TFA) in February  2016 and deposited its 
instrument of acceptance  with the WTO on 4  July 2016. In September  2006,  accepted the Protocol 
amending the Agreement on Trade -Related Aspects of Intellectual Property Rights (TRIPS), with a 
view to making a decision on patents and public health permanent. El Salvador is a participant in 
the Information Technology Agreement (T IA), but does not participate in the ITA extension agreed 
at the 2015 Nairobi Ministerial Conference. At the 2022 Ministerial Conference, held in G eneva, 
El Salvador expressed support for efforts to improve the functioning of the WTO and emphasized 
the imp ortance of concluding the multilateral agenda in areas such as fisheries subsidies and 
agriculture . It also underlined the importance of a robust multilateral system and of continuing to 
promote the interests of small economies. During the review period, E l Salvador has submitted 
several notifications under the various WTO  Agreements. Nonetheless, the country has a number of 
outstanding notifications, mainly in the areas of agriculture and quantitative restrictions. Since its 
last review, El Salvador has no t been involved in any cases as a complainant or respondent under 
the WTO dispute settlement mechanism, although it has participated as a third party in six cases.  
10. El Salvador is participating in the process of establishing a customs union, the Central 
American Common Market (CACM). In 2017, El Salvador began negotiations to join the deep 
integration process that Honduras and Guatemala had launched in 2015. On 16  August  2018, 
El Salvador deposited with the Secretariat for Central American Integration (SICA)  the Protocol of 
Accession to the Enabling Protocol for the process of deep integration initiated by Guatemala and 
Honduras. After a hiatus, negotiations resumed in July  2021.  
11. Since El Salvador's last trade policy review in 2016, trade agreements - jointly  negotiated with 
other Central American  partners  - entered into force with the Republic of Korea and the 
United  Kingdom, and a bilateral partial scope agreement with Ecuador . As such, in addition to the 
CACM, El Salvador has Free Trade Agreements (FTAs) an d/or partial scope agreements with Chile, 
Colombia, Cuba, Ecuador, the United States (CAFTA -DR), Mexico, Panama, the United Kingdom, the 
Republic of Korea, the Dominican Republic (CAFTA -DR and Central America -DR), and the 
European  Union.  WT/TPR/S/440  • El Salvador  
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  12. The fundamental  principles of El Salvador's trade policy continue to be to deepen 
Central  American integration, promote access to foreign markets and improve the country's 
integration into the international economy. Drafted in 2019, the Government Plan ( Plan Cuscatlán ) 
sets out, inter alia, the following foreign policy objectives: (i) further Central American integration, 
based on a holistic approach, (ii) promote FDI through institutional strengthening and increased 
regional economic integration, and (iii) boost foreign tra de by making use of existing trade treaties 
and multilateral agreements, promoting local MSMEs' exports and facilitating customs transit.  
13. During the review period, El Salvador developed a long -term strategy, the Trade and 
Investment Policy 2020 -50, published in 2021. One of the objectives of this Policy is to attract FDI 
in order to boost the development of the most technologically advanced industries and services and 
ensure synergies with the local economy. The Investment Law provides that forei gn investors have 
the same rights and obligations as Salvadoran investors and may transfer abroad all funds related 
to their investment. In accordance with the investment protection agreements and free trade 
agreements to which  it is party, El  Salvador acc epts that investment disputes between the 
Salvadoran State and investors of other signatory parties be submitted to international arbitration. 
Under the Law on Legal Stability for Investments, foreign investors who invest in specific economic 
sectors enjoy  legal certainty through contracts with the State. During the review period, El  Salvador 
adopted several laws, such as the Law on Regulatory Improvement and the Law on Administrative 
Procedures, the implementation of which could help improve the transparen cy of the investment 
environment. Foreign companies are subject to the same tax regime as domestic companies. During 
the review period, El Salvador also developed a National Digital Agenda 2020 -30, which brings 
together a set of actions aimed at strengthen ing a national digital ecosystem to boost the country's 
sustainable development and social well -being . 
14. The customs legal framework has not undergone fundamental changes. At the 
Central  American level, the Central American Single Declaration (DUCA) entered into force in 2019, 
which brings together the main documents needed for regional trade in goods. El Salvador pursued 
its customs modernization efforts during the review period, through, among other things, the 
adoption of ASYCUDA World, the electronic subm ission of advance declarations (with Guatemala, 
and soon with Honduras) enhancements to the risk -management system, the digitization and 
automation of customs services, the installation of radio -frequency identification technology at 
customs facilities, an d improvements  to the physical infrastructure of border . Pursuant to the Trade 
Facilitation Agreement, El  Salvador has honoured its category C commitments concerning the 
trusted operator programme and transit, leaving only the complete implementation of th e single 
window pending. The National Trade Facilitation Committee has implemented several action plans, 
which include measures such as the simplification of trade processes, the digitization of processes 
and the upgrading of the information systems  of Imp ort and Export Processing Centre (CIEX) and 
its interconnection with other institutions.  
15. As a member of the CACM, El Salvador applies the Central American Import Tariff, which 
comprises 11 tariff rates, all ad valorem , ranging from 0 % to 164 %. As at 1  January 2022, 47.8 % 
of tariff lines were duty -free. The arithmetic average of applied MFN tariff rates remained 6.3 % 
in 2022 (as it was in 2015), with an average rate for agricultural products (WTO definition) of 12.4 % 
and for non -agricultural products of 5.3 %. The highest tariff rate (164 %) is applied to meat, edible 
offal and prepared or preserved poultry meat . In March  2022, in an effort to tackle inflation, 
El Salvador temporarily reduced tariffs to 0 % on 49 tariff lines comprising basic foodstuffs and 
agricultural inputs . El Salvador has bound its entire tariff schedule in the WTO. The property transfer 
and services tax (VAT) is levied at a rate of 13 % on the domestic sale and import of most goods, as 
well as the provision of services. Specific and ad valor em taxes are imposed on the consumption of 
certain products, both domestic and imported, such as alcohol and alcoholic beverages, tobacco 
products and their substitutes, arms and explosives, and aerated beverages and energy drinks  
16. El Salvador bans the impo rt of some products, reserves the import of others to the State alone 
and restricts  the import of a number of products for reasons of public health, public safety, 
environmental protection and plant or animal health, and to comply with international agreem ents. 
Permits, authorizations, certificates and/or approval for the import of such products must be 
obtained from various regulatory institutions. At the end of 2022, El Salvador updated its WTO 
notification on import licensing.  
17. The Special Law on trade defence, which came into force and was notified to the WTO in 2016, 
specifies the requirements, time -limits and procedures for conducting dumping, subsidy and WT/TPR/S/440  • El Salvador  
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  safeguard investigations, and empowe rs the competent authority to conduc t such investigations and 
enforce trade defence measures. The Implementing Regulations for the Special Law on trade defence 
were issued in 2017, and a notification of these Regulations to the WTO is currently in preparation. 
El Salvador does not frequently  make use of trade defence measures and has never initiated an 
investigation in relation to countervailing measures or safeguards. During the review period, 
El Salvador initiated two anti -dumping investigations and the review of one measure.  
18. Exporters can carry out their export procedures and obtain the relevant sanitary, 
phytosanitary and origin certificates through the CIEX. There are no export taxes, and VAT is applied 
at a rate of 0%. The export of some products is prohibited or restricted, generally fo r environmental, 
health, public safety and quality control reasons or to comply with international commitments. 
El Salvador controls the export of some products such as cane sugar, agricultural chemicals , 
veterinary medicines, coffee, machinery, arms and e xplosives, and cultural assets. During the review 
period, El  Salvador temporarily restricted the export of red beans with a view to ensuring an 
adequate domestic supply.  
19. There have been no substantial changes to the export incentives regime. The Law on Ind ustrial 
and Commercial Free Zones (LZFIC), amended in 2013, establishes a fiscal incentives scheme based 
on minimum investment and employment requirements and enterprise location. The benefits consist 
of exemptions from income tax, tax on dividends, munici pal taxes and tax on the transfer of real 
estate. In 2021, free -zone exports amounted to USD 1,252 million, almost 19% of the total value 
of merchandise exports. The Law on International Services  (LSI) provides tariff and tax incentives 
to service -exportin g domestic and foreign businesses that meet minimum investment and 
employment requirements. In 2019, specialized aircraft services were recognized as activities 
encouraged by the Law. Amendments to the LZFIC and LSI are being considered with a view to 
increasing the number of eligible sectors and activities, relaxing investment and employment 
requirements and expanding benefits.  
20. The Export and Investment Promotion Agency (PROESA) remains in charge of promoting 
exports. In addition to its traditional servic es (export advisory services, strategic information and 
trade promotion), PROESA offers new lines of support through programmes such as Mujer Exporta , 
Innovación para la Exportación  (focusing on the export of a high value -added and differentiated 
supply of  food and beverages) and the Programa de Gerentes , which seeks to increase business 
competitiveness. The Development Bank of El  Salvador (BANDESAL) provides loans and guarantees, 
albeit in modest amounts, to support exports.  
21. In addition, El Salvador provid es incentives to the production sector that focus on financial 
and technical support for micro, small and medium -sized enterprises (MSMEs)  and on  promoting 
competitiveness, and attracting investment. In recent years, support has also been directed towards 
efforts to facilitate the recovery of enterprises affected by the pandemic, to assist women 
entrepreneurs and to encourage investment in renewable energy and green technology. BANDESAL 
provides financing, directly or through financial institutions, for, inter alia , capital formation, 
industrial park expansion and conversion, machinery and equipment modernization, and energy 
efficiency projects. The National Commission for Micro and Small Enterprises (CONAMYPE), attached 
to the Ministry of Economic Affairs, is responsible for implementing policies to boost the development 
and competitiveness of these enterprises, and conducts numerous activities in this respect. There 
are also a number of development funds through which Salvadoran enterprises receive financia l 
support.  
22. During the review period, there were no substantial changes to the legal and institutional 
framework for the drafting  and application of technical regulations and sanitary and phytosanitary 
(SPS) measures. The Law creating the Salvadoran Quality  System provides that Salvadoran 
Technical Regulations (RTS) must comply with the WTO Agreement on Technical Barriers to Trade 
and the WTO Agreement on the Application of Sanitary and Phytosanitary Measures. El  Salvador's 
notifications for both types of me asure provide for a comment period of 60 days. According to the 
authorities, the majority of RTS, including their conformity assessment procedures, are based on 
international standards. The drafting and adoption of RTS are based on the Handbook of Good 
Technical Regulation Practices, and the same procedure is followed for SPS measures. For certain 
products, El Salvador recognizes the sanitary registration certificates issued by the authorities of 
CACM member countries, as well as the registration certificat es and sanitary inspection systems of 
other trading partners under the corresponding free trade agreements.  WT/TPR/S/440  • El Salvador  
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  23. El Salvador's  legal framework regarding competition policy has undergone changes since the 
previous review. The Competition Law was amended  in 2017 and 2021. Since the amendment  in 
2017, it has been possible to challenge the decisions of the Supervisory Authority for Competition 
(SC) before the administrative courts.  Under the 2021 amendment , a number of procedures were 
modernized and the use of elect ronic and technological means of conducting SC proceedings was 
enabled. The leniency programme was also expanded. Between 2016 and 2021, the SC initiated 
29 investigations, the majority of which were launched following a complaint, and penalized 
five unlaw ful practices. In addition, 16  applications for mergers, mainly from the financial, beverage 
and telecommunications sectors, were accepted for consideration.  
24. El Salvador is not a signatory to the WTO Agreement on Government Procurement and does 
not partici pate as an observer in the respective Committee. Salvadoran legislation does not 
distinguish between Salvadoran and foreign suppliers in their participation in public procurement. 
However, if there is no difference between two bids in terms of conditions, preference is given to 
the Salvadoran bid (except in the case of procurement under trade agreements). Under an 
amendment made to the legislation in 2019, the share of the annual procurement budget that each 
government entity must allocate to MSMEs was incr eased to 25%. In 2021, new legislation was 
passed for procurement by municipalities in respect of certain infrastructure projects.  
25. The amendment  of the Intellectual Property Law (LPI) was approved in 2017. The amendment 
to the LPI allows holders of copyrig ht and related rights to manage the use of their works. The LPI 
gives the holder of copyright the right to import or export, or authorize the import or export of, 
copies of their lawfully manufactured works, and the right to prevent the import or export of  
unlawfully manufactured copies; similar rights are regulated in the LPI for holders of industrial 
property rights. El  Salvador allows the granting of compulsory licences solely in order to supply the 
domestic market. Compulsory licensing to work a patent may be granted for declared reasons of 
emergency or national security and for as long as these persist, provided that this is necessary to 
satisfy the population's basic needs. Until  2022, El  Salvador had not issued any compulsory licences. 
On 17  June 2022, the exceptional circumstances of the COVID -19 pandemic led El  Salvador to adopt 
the Ministerial Decision on the TRIPS Agreement for the production and supply of vaccines. The 
Directorate -General of Customs (DGA) may intervene and apply border measures on  the basis of 
resolutions by the competent authority; ex officio  where applicable; or following a complaint from 
the owner of the duly accredited right.  
26. The agricultural sector recorded uneven performance during the review period, with a growth 
rate that f ell from 8.3% in 2016 to 2.1% in 2021. The sector's share of GDP stood at 4.9% in 2021, 
while its contribution to employment amounted to 15.7%. The main agricultural products are staple 
grains, other crops, cattle, poultry products and sugar cane. The coff ee subsector has continued its 
downward trend. El  Salvador is a net importer of agricultural products, which is why the sector's 
trade balance deficit increased during the review period. Agricultural products (WTO definition) have 
a higher level of tariff protection (12.4%) than non -agricultural products (5.3%). During the period 
under review, El  Salvador use d scarcity quotas to deal with shortages of some products caused by 
adverse weather events , and adopted various support measures for the sector in the context of 
COVID -19. El Salvador supports the agricultural sector with the primary objective of achieving food 
sovereignty. Its most recent domestic support notification to the WTO refers to the year 2015/2016; 
the support is modest and includes mainly loans, the delivery of inputs and technical assistance .   
27. Metal mining was banned in El Salvador for environm ental reasons in 2017. The law prohibits 
metal mining in the soil and subsoil. The ban on metal mining includes exploration, extraction, 
exploitation  and processing, whether opencast or underground . While El Salvador has no discovered 
oil resources and rem ains an importer of oil derivatives , petroleum products account ed for 
approximately 67% of total energy supply in 2021 . During the review period, renewable electricity 
generation was boosted, with a marked increase in the installed capacity of solar photov oltaic power, 
and the introduction of the first wind power plant . In addition, El Salvador developed a new strategy, 
the National Energy Policy 2020 -50, which sets out guidelines for achieving an efficient and 
competitive energy system that is committed to  protect ing the environment . 
28. El Salvador's services sector remains substantially open to foreign participation . The financial 
services sector accounted for 6.6% of GDP in 2021 . Most banks in El Salvador are foreign -owned, 
and there are no restrictions on t heir operations. For foreign banks, commercial presence in 
El Salvador can take the form of a branch office or a representative office . The only exception to 
national treatment pertains to assets that a foreign financial institution may own in El Salvador.  In WT/TPR/S/440  • El Salvador  
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  cases of that kind, the Banks Law provides that depositors and creditors domiciled in El Salvador 
enjoy preferential rights over those domiciled abroad . Financial conglomerates are also subject to 
consolidated oversight . To operate in El Salvador , foreign insurers must secure a commercial 
presence by legally establishing a subsidiary in the country . The establishment of new branches has 
not been permitted since 1997 . The last remaining branch of a foreign insurer closed in 2021 . The 
cross-border supply of insurance services is not permitted, but there are no restrictions on the use 
of insurance services abroad . 
29. The telecommunications sector legal framework allows for foreign investment without capital 
restrictions, except in connection with radio and television broadcasting services, which are reserved 
to Salvadorans. Pursuant to the Law on Telecommunications, a concession is required to provide  
fixed and mobile telephony services, and to use the regulated radio spectrum. The Law was subject 
to a n umber of amendments during the review period, inter alia , to regulate the allocation of radio 
frequencies, establish alternative mechanisms to public auction, protect user rights, reinforce the 
obligations of telecommunications operators, and adapt regulat ions to technological developments. 
During the review period, the Supervisory Authority for Competition investigated and sanctioned 
one case of anti -competitive practices in the national and international calls termination market.   
30. The transport sector's a verage annual share of GDP was 4.5% during the review period. FDI 
in the sector increased by 425.7%, reflecting the liberalization policies and buoyancy of the sector. 
Steps were also taken to launch major infrastructure projects, including the bicentennia l ferry route, 
the construction of the new Pacific International Airport and the Pacific Train, and existing 
infrastructure was upgraded. With regard to maritime and port matters, there are no restrictions on 
the provision of cabotage services by foreign v essels, and foreign companies are allowed to operate 
ports under concessions and provide ancillary port services, such as cargo handling and 
warehousing. Turning to air transport, there are no restrictions on foreign investment for the 
purposes of establis hing a commercial presence in the country, nor on foreign ownership of 
Salvadoran airlines, although air cabotage is reserved exclusively to domestic companies. El Salvador 
applies an open skies policy and has 17 air services agreements. Land transport is the main means 
of transporting freight and carried Salvadoran foreign trade goods to the tune of USD 14,053 million 
in 2021.    
31. Tourism is of increasing  importance  for El Salvador  given its ability to  create jobs, attract 
investment  and boost the economy . The sector developed positively until 2019, but was then 
affected by the COVID -19 pandemic. Since 2021, tourism has rebounded significantly. There are no 
restrictions on foreign investment in the sector  WT/TPR/S/440  • El Salvador  
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  1  ECONOMIC ENVIRONMENT  
1.1  Main features of the economy  
1.1.  El Salvador is a lower -middle -income country . During the review period, GDP per capita at 
current prices increased slightly , from USD 3,853 in 2016 to USD 4,543 in 2021 . As noted in the 
previous TPR report, remittances from abroad, particularly from the United States, are an important 
source of financing for private domestic expenditure.  
1.2.  The sectoral composition of Salvadoran GDP fluctuated somewhat during the review period, 
especially as concerns activities related to or affected by the COVID -19 pandemic . Thus, the 
agricultural and manufacturing sectors contributed less to GDP during the pand emic, although the 
manufacturing sector recovered in early 2022 . This sector, including the maquila industry, recorded 
a GDP share at current prices of 15.2 % in 2021 (17.1 % of value added), compared to 16.3 % in 
2016 (17.9 % of value added) ; however, this sh are dropped to 14.9 % in the second quarter of 2022 . 
The share of agriculture in GDP declined from 5.7 % in 2016 to 4.9 % in 2021.  
1.3.  The service sector continue d to contribute  the largest relative share of GDP  of El Salvador  
during the period under review , acco unting for 60 % of the total  and two thirds of value added, if 
taxes net of subsidies are deducted ( Table 1.1) . Of these services, trade accounts for the largest 
share  of GDP , 11.2 % in 2021 ; followed by public administration and defence services, compulsory  
social security , with 8.2 %, the GDP share of which increased during the pandemic ; real estate 
activities, with 6.7 %; and financial and insurance services , with 6.6 %. 
Table 1.1 Main economic indicators 2016 -22 Q3 
(USD million  and %)  
2016  2017  2018  2019  2020  2021b 2022  Q3b 
Gross domestic product (GDP)  
GDP at current prices ( USD million ) 24,191  24,979  26,021  26,881  24,563  28,737  23,361  
GDP - Chained volume indicesc 105.0  107.4  110.0  112.6  103.4  114.1  116.0  
Real GDP, growth rate (%)c 2.5 2.2 2.4 2.4 -8.2 10.3 2.2 
GDP per capita ( USD) 3,853  3,969  4,127  4,257  3,886  4,543  .. 
GDP by activity (% of GDP)  
Agriculture, forestry and fishing  5.7 5.4 5.1 5.1 5.5 4.9 4.7 
Mining and quarrying  0.3 0.3 0.3 0.3 0.3 0.3 0.3 
Manufacturing  16.3 16.1 15.7 15.6 14.9 15.2 15.4 
Electricity, gas, steam and 
air-conditioning supply  2.4 2.8 2.9 2.8 2.5 2.6 3.4 
Water supply, sewerage and waste 
management  0.8 0.7 0.7 0.7 0.7 0.7 0.7 
Construction  5.1 5.2 5.5 6.0 5.5 5.3 5.5 
Services  61.6 61.3 61.3 61.1 61.0 59.9 58.9 
 Trade, repair of motor vehicles and 
motorcycles  11.6 11.5 11.6 11.5 11.5 11.2 11.3 
 Transport and storage  4.9 4.7 4.4 4.5 4.2 4.4 4.4 
 Accommodation and food service 
activities  2.8 2.9 2.9 3.0 2.4 2.9 3.1 
 Information and communications  3.4 3.3 3.2 3.1 3.2 2.9 2.8 
 Financial and insurance activities  6.2 6.3 6.4 6.5 7.2 6.6 6.6 
 Real estate activities  7.4 7.3 7.3 7.2 7.3 6.7 6.4 
 Professional, scientific and technical 
activities  2.3 2.3 2.2 2.1 1.8 1.7 1.8 
 Administrative and support service 
activities  3.5 3.6 3.8 3.9 4.2 4.1 4.2 
 Public administration and defence, 
compulsory social security  7.4 7.4 7.3 7.3 8.4 8.2 7.8 
 Education  4.7 4.6 4.7 4.7 4.7 4.5 4.1 
 Human health and social assistance 
activities  3.1 3.2 3.1 3.2 3.7 3.9 3.7 
 Arts, entertainment and recreation  0.4 0.4 0.4 0.4 0.3 0.4 0.4 
 Other service activitiesd 2.7 2.7 2.6 2.6 2.2 2.3 2.4 
 Activities of households as 
employersd 1.2 1.2 1.2 1.2 0.0 0.0 0.0 
Gross value added  90.9 90.7 90.3 90.5 90.4 88.8 88.9 
Taxes net of subsidies  9.1 9.3 9.7 9.5 9.6 11.2 11.1 
GDP by expenditure category (% of GDP)  
Final consumption expenditure  99.9 99.6 99.4 97.8 99.2 103.1  104.2  
 Households  82.9 82.7 82.6 81.1 79.4 83.4 86.8 WT/TPR/S/440  • El Salvador  
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2016  2017  2018  2019  2020  2021b 2022  Q3b 
 Non-profit institutions serving 
households (NPISH s)e 0.7 0.7 0.7 0.6 .. .. .. 
 General government  16.3 16.1 16.1 16.0 19.8 19.7 17.4 
Gross capital formationf 16.0 16.7 18.4 18.3 18.9 22.2 23.0 
 Gross fixed capital formation  15.5 16.0 17.2 17.8 17.8 21.0 .. 
 Private  13.0 13.5 14.5 15.4 15.7 18.4 .. 
 Public  2.5 2.6 2.7 2.4 2.1 2.6 .. 
 Change in inventories  0.5 0.6 1.2 0.6 1.2 1.2 .. 
Exports of goods and services  28.5 29.0 28.9 30.0 25.6 29.5 33.1 
Imports of goods and services  44.4 45.3 46.7 46.1 43.8 54.8 60.3 
GDP by expenditure category (real annual growth rate)  
Final consumption expenditure  1.5 1.4 1.4 1.5 -7.4 13.8 2.1 
 Households  2.0 1.7 1.4 1.7 -10.1 15.4 3.3 
 Non-profit institutions serving 
households (NPISHs)e 1.5 -1.0 -1.0 -4.3 .. .. .. 
 General government  -1.0 0.1 1.7 0.5 10.1 7.2 -2.7 
Gross capital formation  4.6 3.1 10.5 2.6 2.3 8.1 .. 
 Gross fixed capital formationg 3.6 3.6 7.2 6.3 -6.9 24.5 4.9 
 Private  3.8 3.4 7.9 8.8 -5.1 23.9 .. 
 Public  2.9 4.9 3.4 -7.5 -18.8 29.5 .. 
 Change in inventories  50.8 -13.1 91.3 -50.2 282.5  -238.7  .. 
Exports of goods and services  0.2 3.4 1.6 8.5 -21.0 26.1 11.3 
Imports of goods and services  -0.5 1.4 2.6 4.2 -10.6 26.6 5.6 
Monetary indicators  
Consumer price index (annual average, 
Dec. 2009=100)  110.0  111.2  112.4  112.4  112.0  115.9  123.2  
Consumer price index (end of period, 
Dec. 2009=100)  109.6  111.8  112.3  112.3  112.2  119.1  125.9  
Change in the consumer price index, 
end of period (%)  -0.9 2.0 0.4 0.0 -0.1 6.1 7.5 
Real effective exchange rate, index 
(2000=100, end of period)  98.7 100.8  100.5  103.4  106.1  104.2  102.8  
Real effective exchange rate, index 
(2000=100, average)  99.0 99.9 101.2  102.3  103.3  105.3  104.2  
Real effective exchange rate, annual 
change (end of period)  0.9 2.1 -0.3 2.8 2.7 -1.8 -1.9 
Real effective exchange rate, annual 
change (average)  -0.7 1.0 1.2 1.1 1.0 1.9 -1.3 
Interest rates (1994 -2021 methodology)  
30-day deposit rate (%)  4.0 3.8 3.5 3.6 3.4 3.0 .. 
180-day deposit rate (%)  4.4 4.4 4.2 4.3 4.1 3.9 .. 
360-day deposit rate (%)  4.6 4.7 4.6 4.6 4.4 4.2 .. 
Loan rate up to one year (%)  6.4 6.5 6.6 6.6 6.8 6.4 .. 
Interest rate (2022 methodology)  
30-day deposit rate (%)  4.3 4.0 3.7 3.6 3.5 3.1 3.3 
180-day deposit rate (%)  4.5 4.6 4.4 4.3 4.2 4.1 4.5 
360-day deposit rate (%)  4.8 4.8 4.7 4.6 4.5 4.5 4.8 
Loan rate up to one year (%)  6.1 6.3 6.4 6.6 6.6 6.2 6.2 
M1(USD million ) 3,135  3,663  3,812  4,251  4,997  5,139  4,911  
M2(USD million ) 11,254  12,449  13,197  14,710  16,409  16,819  17,277  
M3(USD million ) 12,103  13,449  14,265  15,878  17,287  17,677  18,174  
Net international reserves 
(USD million s, end of period)  2,923  3,273  3,354  3,936  2,915  3,342  2,941  
Other economic indicators  
Current account balance (% of GDP)  -2.3 -1.9 -3.3 -0.4 0.8 -5.1 -8.9 
Monthly family remittances (% of GDP)  18.8 20.0 20.7 21.0 24.1 26.1 24.4 
Total foreign debt (% of GDP)  67.7 66.0 63.8 64.5 76.3 70.6 90.5 
Gross national disposable income 
(USD million ) 27,487  28,626  29,920  31,180  29,235  34,543  .. 
Gross national disposable income per 
capita ( USD) 4,378  4,548  4,745  4,938  4,625  5,461  .. 
Population (thousand  person s) 6,279  6,294  6,306  6,315  6,321  6,326  .. 
.. Not available.  
a Preliminary figures.  
b Estimates . 
c Seasonally adjusted series, reference year 2014.  
d Beginning in 2019, figures for activities of household s as employers are included under other service 
activities.  
e Beginning in 2019, NPISH figures are included under households ' final consumption  expenditure . 
f In 2021, gross capital formation includes gross fixed capital formation and changes in inventories.  
g In chained volume indexes, only gross fixed capital forma tion is included.  
Source:  Central Reserve Bank of El Salvador.  WT/TPR/S/440  • El Salvador  
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  1.4.  The Trade and Investment Policy of El Salvador 2020 -50, developed by the Secretariat for 
Trade and Investment of the Office of the Presiden t of the Republic , which was created in 2019, set s 
out the conceptual framework and the main strategic lines of action to address the medium - and 
long-term structural challenges of the Salvadoran economy in trade and investment . The aims of 
the trade and investment policy a re: (a) to complete the integration of Salvadoran companies into 
global value chains, by detecting untapped export and investment opportunities abroad ; (b) to 
contribute to diversifying and transforming the output of the industrial and service sectors , by 
increasing the technological content of products , through measures to enhanc e the external 
competitiveness and internationali zation of companies ; (c) to attract and retain investment in order 
to boost the development of the most technologically advanced in dustries and services, and to better 
structure the productive system as a whole, by ensuring synergies and linkages with the local 
production apparatus ; and (d) to develop the physical, digital and legal infrastructure that creates 
an enabling environment for foreign trade and attracts investment . The policy establishes three key 
macro -objectives : (a) to boost the contribution of exports to GDP ; (b) to eliminate the balance of 
payments deficit ; and (c) to increase the stock of foreign direct investment  (FDI). To achieve the 
first macro -objective , a target has been set for exports to account for 38 % of GDP by the end of the 
period in question . It is estimated that, with real GDP growing at around 3.5 % per year, meeting 
the 38 % target would require an annual increase in export volume of 4.5 %, well above the average 
for the period 2016 -19, but only slightly above the average for the period 2001 -19. To achieve the 
2050 target, exports would need to exceed a value equivalent to 30 % of GDP in 2025, and 33 % in 
2035. 
1.5.  Targets will be set for each five -year period, based on the gains made in the previous five -year 
period, as well as on global econom ic forecasts . Targets and actions shall also be set to achieve  the 
macro -objective s: (a) to boost imports, the aim is to increase the number of exporting companies,  
regular exporters an d the percentage of micro - and small enterprises among  exporting companies  
in line with specific targets ; (b) to eliminate the balance of payments deficit , the target for the period 
2021-50 is to keep the proportion of imports at around the current level of 45 % of GDP; (c) to 
increase the stock of FDI , the target  has been  set that it should  be no less than 60 % of GDP  by 2050 
(see Section 2 for more details on ta rgets and implementation).1 
1.2  Recent economic developments  
1.2.1   The real sector  
1.6.  For most of the period under review, the Salvadoran economy continued to show positive, 
albeit relatively modest, GDP growth rates, ranging from 2.3 % to 2.5 % between 2016 and 2019, 
with an annual average of 2.4 %. The real increase in final consumption expenditure in the period 
ranged between 1.4 % and 1.5 %, the result of private consumption varying between 1.3 % and 2.0 % 
and a very moderate change in government expenditure (between -1.0% and 1.7 %). Gross fixed 
capital formation remained buoyant during the period 2016 -19. 
1.7.  The Salvadoran economy was hit hard by the COVID -19 pandemic, which not only caused a 
drop in domestic  activity, but also a substantial decline in foreign remittance inflows, a predominant 
source of financing for domestic demand . Salvadoran real GDP shrank by 8.2 %. Final consumption 
expenditure contracted by 7.4 %, as a result of a 10.1 % fall in household s pending, mainly owing to 
a reduction in labour income, which was only partially offset by a 10.1 % rise in general government 
expenditure to deal with the pandemic . Although gross capital formation increased by 2.3 %, this 
was owing to a strong accumulation of inventories, as gross fixed capital formation, both public and 
private, contracted . The pandemic materially affected both exports and imports of goods and 
services, which fell by 21 % and 10.6 % in real terms , respectively . 
1.8.  The Salvadoran economy recovere d from the pandemic in 2021 . GDP growth was 10.3 % in 
2021. The substantial growth resulted from a recovery in domestic demand, a strengthening of 
external demand, and an increase in remittances, which accounted for 26.1% of GDP in 2021 . This 
drove a 15.4 % rebound in public consumption in 2021 . Moreover, gross capital formation expanded 
by 8.1 %; discounting the effect of inventories, gross fixed capital formation growth in 2021 was 
24.5%, underpinned by a surge in both public and private investment . Exports and imports of goods 
and services recovered steadily, up by more than 26 % in real terms from 2020 levels in both cases.  
 
1 El Salvador Trade and Investment Policy, 2020 -50. Viewed at: https://www.transparenciafiscal.gob.sv . WT/TPR/S/440  • El Salvador  
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  1.9.  As noted in the previous review, the composition of GDP expenditure in El Salvador is still 
characterized by a high level of both  private and public consumption . Total consumption was 
equivalent to 103.2 % of GDP in 2021, with private household consumption accounting for 83.4 % 
and public expenditure for 19.7 %. The share of investment (gross fixed capital formation) stood at 
21.0% and private investment accounted for 18.4 % of GDP . Again, in 2021, exports of goods and 
services amounted to 29.5% of GDP, and imports 54.8 % of GDP.  
1.10.  According to information from the Central Reserve Bank, the Salvadoran economy grew by 
2.2% in the third quart er of 2022 compared to the same period the previous year . The 
fastest -growing sectors, considering the annual real growth rate of the seasonally adjusted series, 
were: electricity (12.6 %), construction (12.5 %), leisure services (10.7 %), government services  
(6.9%), administrative and support services (6.7 %), restaurants and hotels (4.5 %), and personal 
services (3.5 %).2 Growth in the third quarter of 2022 followed the positive trend of the first half of 
2022 and of the performance in 2021.  
1.11.  As reported by  the authorities, growth in 2022 was driven by a combination of factors that 
boosted domestic production and cushioned the impact of adverse international conditions, including 
the improved security climate that increased business and household confidence, promoting 
investment and consumption, as well as the implementation of anti -inflationary measures that 
reduced the impact on business production costs, and the magnitude of the increase in consumer 
prices .3 In addition,  it is believed that higher  investment and the boost to tourism, together with the 
development of electricity generation capacity, continue to have a positive impact on the economy.4 
1.12.  On the demand side, economic growth in the 12 months to 3 0 September  2022 was explained 
by the incr ease in exports of goods and services (12.6 %), gross fixed capital formation (11.1 %) and 
private consumption (2.1 %). Public consumption fell by 2.3 %, as resources earmarked in 2021 for 
the purchase of vaccines or food baskets were redirected to other budge t items such as investment . 
Imports recorded an annual increase of 2.5 %, mainly for intermediate goods for processing and 
capital goods required for production processes . The projected real GDP growth for the whole of 
2022 is 2.8 %. Estimates for r eal GDP g rowth in 2023 put it  at 2-3%. The impact of the global 
economic slowdown is expected to be offset by buoyant domestic demand driven by public 
investment, improved security conditions promoting consumption and private investment, as well 
as tourism . Inflation is projected at 3.3 % by 2023.5 
1.13.  According to the payroll records reported by employers to the Salvadoran Social Security 
Institute, 948,810 people  were employed in August  2022 (756,029 in the private sector and 192,781 
in the public sector), maintaining  the growing trend observed throughout the year, despite the 
difficulties of the international environment and the impact of natural disasters that have affected 
the country . According to the figures, in the last year, employment in the private sector has grown 
7.2%, while in the public sector it is up 2.9%, with average growth of 6.3 % overall . The best 
performing sectors continue to be trade, restaurants and hotels, the services sector and the 
manufacturing industry .6 According to World Bank data, the unemployment rate in 2021 was 5.9 %.7 
1.14.  Development indicators continued to improve during the period under review, at least until 
before the pandemic . The percentage of the population living in extreme poverty (daily income below 
USD 1.90 in 2011 purchasing  power parity) fell from 2.6 % in 2016 to 1.4 % in 2019 .7 Poverty 
 
2 Central Reserve Bank, Situación Económica de El Salvador, tercer trimestre de 2022 y proyecciones  
2022-23. 23 December 2022 Viewed at: 
https://www.bcr.gob.sv/documental/Inicio/vista/7826752460f207e8cc67cc88f31017bd.pdf . 
3 Central Reserve Bank, Economía salvadoreña creció 2,8 % en el segundo trimestre de 2022 . Press 
release of 30 September 2022. Viewed at: 
https://www.bcr.gob.sv/documental/Inicio/vista/53a54 59c78dbdbd26d8f880c26cdb4d3.pdf . 
4 Central Reserve Bank (2022), Economía salvadoreña creció 2,2 % en el tercer trimestre de 2022 y se 
mantiene la proyección de 2,8 % para el cierre del año . Viewed at: : 
https://www.bcr.gob.sv/2022/12/23/economia -salvadorena -crecio -2-2-en-el-tercer -trimestre -de-2022-y-se-
mantiene -la-proyeccion -de-2-8-para-el-cierre -del-ano/.  
5 Central Reserve Bank (2022), Economía salvadoreña creció 2,2 % en el tercer trimestre de 2022 y se 
mantiene la proyección de 2,8 % para el cierre del año . Viewed at: 
https://www.bcr.gob.sv/2022/12/23/economia -salvadorena -crecio -2-2-en-el-tercer -trimestre -de-2022-y-se-
mantiene -la-proyeccion -de-2-8-para-el-cierre -del-ano/. 
6 Information from the Government of El Salvador. Viewed at: 
https://www.transparencia.gob.sv/institutions/isss/documents/estadisticas . 
7 Information from the World Bank. Viewed at: https://datos.bancomundial.org/pais/el -salvador . WT/TPR/S/440  • El Salvador  
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  measured according to national indices and the cost of a basic food basket shows that extreme 
poverty in 2020 was 8.6 %, falling to 7.8 % of households during 2021, as a result of measures 
imple mented by the Government to boost  household income.8 
1.2.2   Fiscal policy  
1.15.  The Ministry of Finance is responsible for framing and implementing fiscal policy in El  Salvador . 
The Organic Law on State Financial Administration and the Fiscal Responsibility Law for th e 
Sustainability of Public Finances and Social Development  (LRF) provide guidelines for budgetary 
policy and the framework within which it must be developed . Its scope of application is the 
non-financial public sector (NFPS) . The LRF was amended by Decree No. 188 of 1 1 December  2018, 
Reform of  the Fiscal Responsibility Law for the Sustainability of Public Finances and Social 
Development.  
1.16.  The LRF9 introduced a series of measures to achieve the consolidation and stability of public 
finances. In its preamble, the Law advocates that fiscal policy should be a tool to bring about 
economic and social development, which requires  fiscal stability and a sustainable public finance 
model , impl ying reasonable public expenditure and increasing ly robust government revenue s.10 
1.17.  The LRF is based on three principles : (a) the State should seek to ensure long -term fiscal 
balance by setting primary balance targets to bring the debt -to-GDP ratio down to a pre -established 
level and subsequently keep it stable ; (b) the preparation of the general State budget should be 
framed by a five -year macroeconomic scenario and indicative budgets ( medium -term budget 
principle ) – this timeframe was reduced to four years by the 2018 reforms ; and, (c) all state 
institutions should provide full and sufficiently detailed information on the implementation of each 
budget, investments made, contingent liabilities and results achieved on a semi -annual basis, with 
a lag of no more than 60 calendar days ( transparency principle ). The Ministry of Finance is 
responsible for submitting consolidated reports every six months, in order to verify the financial 
situation of the NFPS and compliance  with the objectives of fiscal health and social sustainability.  
1.18.  The LRF establishes a three -year fiscal consolidation period (Art icle 7), starting from the 
beginning of fiscal year 2017, defined by the implementation of revenue and expenditure measures, 
resulting in at least 3.0 % of GDP . This period was extended to five years by the amendment to the 
LRF. After the fiscal consolidation period, in the subsequent five years and beyond, adequate 
long-term sustainability should be ensured . At the end of the con solidation period and in the 
following years, the NFPS debt ratio, net of pension debt, shall be less than  50% of GDP . The debt 
of the NFPS, including the pension system , should continue to follow a downward trend and not 
exceed 60 % of GDP by 2030.11 
1.19.  The LRF (Article  10), as amended in 2018, include s the following targets for the NFPS : 
(a) achieve positive primary balances after the end of the fiscal consolidation period ; the surplus for 
2020 should be equal to or higher than 0.7 % of GDP and the surplus for 2021 should be equal to or 
higher than 1.2 % of GDP . The NFPS debt limit and the primary balance are the main rules of this 
law; (b) at the end of 2021, the tax burden should not be less than 18.5 % of GDP ; and (c) after the 
fiscal consolidation period, consumption expenditure should not exceed 14 % of GDP . To this end, 
the categories of wages and salaries, and goods and services may not grow beyond nominal 
GDP growth.  
1.20.  The LRF created the medium - and long -term fiscal framework (MFML P), within which fiscal 
provisions, regulations, estimates and projections updated over a 10-year period  are adopted . The 
MFMLP  seeks to link policy and budget planning in the medium and long  term and to ensure 
transparency . It aims to prioriti ze spending in a manner that is consistent with the LRF. The MFMLP  
 
8 The urban basic food basket contains 11 products: bread rolls, tortillas, rice, meats, fats, eggs, liquid 
milk, fruits, beans, vegetables, sugar, plus 10 % of the cost of cooking the food. The rural basic food basket 
contains the same food products, minus the vegetables and bread rolls.  
9 Decree No. 533 of 10 November 2016.  
10 Fiscal Responsibility Law for the Sustain ability of Public Finances and Social Development. Viewed at: 
https://www.transparenciafiscal.gob.sv/downloads/pdf/DINAFI02000001_ D_L_533_Ley_de_Responsabilidad_Fi
scal.pdf . 
11 Reform of the Fiscal Responsibility Law for the Sustainability of Public Finances and Social 
Development. Viewed at: https://www.transparenciafiscal.gob.sv/downloads/pdf/700 -DPEF-LY-2019-188.pdf . WT/TPR/S/440  • El Salvador  
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  is intended to guide strategic fiscal policy decision -making by providing a baseline for multi-year 
fiscal projections of revenues, expenditures and financing . The MFMLP  should contain, inter alia : 
(a) a baseline economic scenario for preparing the general State budget and fiscal projections ; 
(b) the targets and thresholds of the main fiscal policy indicators to be achieved over the next 
10 years ; (c) projections of fiscal  revenues and expenditures and debt flows ; (d) public investment 
project  programming , including financing ; (e) the level of total public debt in dollars and as a share 
of GDP ; (f) a fiscal risk  assessment ; (g) indicators of fiscal policy sustainability in the medium and 
long term ; (h) a detailed report on the financial performance and trends of non-financial public 
enterprises (NFPEs) ; and (i) the estimated rate of income tax evasion.  
1.21.  The Ministry of Finance prepared the MFMLP 2019-29, which had to be subseq uently modified 
in the wake of the COVID -19 pandemic . The MFMLP 2019-29 provides information on two indicative 
fiscal projection scenarios ; the first, linked to a baseline economic scenario with real GDP growth 
between 2.5 -2.7% for the 2020 -24 period and t he second, with a growth range between 2.8 -3.5%. 
According to t he MFMLP , economic growth must be stimulated by prioriti zing investment in security, 
infrastructure, human capital, social well-being and the competitiveness of the economy  in order to 
achieve the long -term fiscal sustainability goals and reduce the debt -to-GDP ratio to 60.0 % by 2030 . 
On the expenditure side, the document states that the efficient allocation of state resources shall be 
promoted by improving procurement manag ement, expanding contracting modalities such as 
reverse auctions, incorporating a strong component of technological innovation and moderni zing the 
electronic system and regulations, among other measures . On the revenue side, there are plans to 
institute me asures to modernize tax collection to facilitate the declaration and payment of taxes, 
such as the introduction of an electronic invoice, the simplified taxation system , technological 
innovation of procedures and administrative measures to exercise greater  fiscal control in order to 
reduce tax evasion and avoidance . According to information from the Ministry of Finance, several 
targets set for 2019 were fully or partially met . The application of the LRF was suspended by 
Legislative Decree No. 607, of 26 March 2020, for the duration of the national emergency declared 
in response to  the COVID -19 pandemic.  
1.22.  The Plan Cuscatlán  (Government  Plan) proposes to implement a number of general actions to 
make fiscal policy more equitable and efficient . They include : (a) implementing a comprehensive tax 
reform to make the tax system progressive and equitable , and to reduce or eliminate non -productive 
benefits ; (b) reorgani zing the fiscal control functions (incentives and subsidies) of the Ministry of 
Finance ; and (c) shifting from an import -consumption model, which breeds joblessness and 
promotes remittances, to a production -export model, which aims to create new enterprises and 
boost GDP growth . This shift requires a permanent fiscal pact . Actions identified to achiev e this 
include implementing a tax system based on worldwide income, implementing a differentiated VAT, 
making use of electronic invoicing to reduce tax evasion, introducing a simplified taxation system , 
automating services, simplifying processes, and impro ving controls and oversight by the Ministry of 
Finance.12 
1.23.  El Salvador implemented a series of measures to deal with the COVID -19 pandemic, contained 
in a number of decrees .13 In April 2020, the Ministry of Finance was authorized to raise up to 
USD 2 billion, and in May 2020, an additional USD 1 billion  was authorized .14 
 
12 Plan Cuscatlán . Fiscal . Viewed at: https://plancuscatlan.com/documentos/plancuscatlan_fiscal.pdf . 
13 Decree No.  598, Special Temporary Law on the Mode of Payment of Income Tax Applicable to Small 
Taxpayers, Tourism, Electricity, Television, Internet and Telephone Services, and on the Special Contribution 
for the Promotion of Tourism, of 20 March 2020; Dec ree No.  601, Temporary Law to Defer the Payment of 
Water, Electricity and Telecommunications (Telephone, Cable and Internet) Service Bills, of 20 March 2020; 
Decree No.  603, Temporary provisions to simplify the procedure for donations of goods by companies  
regulated by the Law on Industrial and Commercial Free Zones, of 20 March 2020; Decree No.  604 modifying 
the Central American import tariff, of 20 March 2020; Decree No.  607 temporarily suspending, and for the 
duration of the effects of the national emerg ency declared in response to the COVID -19 pandemic, the 
application of the Fiscal Responsibility Law for the Sustainability of Public Finances and Social Development, of 
26 March 2020; Decree No.  608 authorizing the Executive Body in the area of finance to  secure funds of up to 
USD 2  billion, of 26  March  2020; Decree No. 640 authorizing the Executive Body in the area of finance to 
secure funds of up to USD  1 billion, of 5 May 2020; Decree No. 643, Temporary Law to Facilitate Voluntary 
Compliance with Tax Ob ligations in view of the National Emergency declared in response to the COVID -19 
Pandemic, of 19  May 2020.  
14 Decree No. 608 authorizing the Executive Body in the area of finance to secure funds of up to 
USD 2 billion, of 26  March  2020; Decree 640 authorizi ng the Executive Body in the area of finance to secure 
funds of up to USD 1 billion  , of 5 May 2020; Decree No. 643, Temporary Law to Facilitate Voluntary WT/TPR/S/440  • El Salvador  
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  1.24.  The principal fiscal and expenditure -related measures to cope with the pandemic included 
(i) a salary increase of USD 150 for all employees of the Ministry of Health and other public 
institu tions affected by the COVID -19 pandemic ; (ii) a one -time subsidy of USD 300 to 
approximately 75 % of all households ; (iii) distribution of 2.7 food baskets to affected families worth 
USD 56 each ; (iv) a three-month deferral of utility payments ; (v) a three -month extension for the 
payment of income tax by taxpayers operating in the tourism sector with a taxable income of less 
than USD 25,000, taxpayers operating in the electricity and telecommunications sectors , and all 
taxpayers with a tax liability of  less than USD 10,000 ; (vi) a three-month exemption from the special 
tourism tax for companies operating in the tourism sector ; and (vii) the temporary elimination of 
duty on imports of essential medical and food products (medical textiles, disinfectants, flour, rice 
and beans).15 
1.25.  During the period under review, the ratio of consolidated central government revenues to GDP 
increased from 18.1 % in 2016 to 21 % in 2021 due to higher  tax revenues ( Table 1.2) . Although 
they fell in nominal terms, tax revenues as a percentage of GDP did not decline during the pandemic, 
and even increased slightly . Public expenditures accounted for 19.0 % of GDP in 2016, rising to 
20.7% in 2019 . The central government deficit remained relatively stable between  2016 and 2019, 
ranging from 1.9 % to 3.7 % of GDP . The deficit rose to 10.4 % of GDP in 2020, as a result of the 
increase in expenditure to 29.2 % of GDP in the wake of  the implementation of the measures outlined 
above to cope with the pandemic . Even under the negative impact of the pandemic, the deficit, 
including pensions and trusts, was 5.9 % of GDP in 2021, when spending represented 25.9 % of GDP.  
Table 1.2 Consolidated c entral government financial account, 2016 -22 Q3  
(% of GDP)   
2016  2017  2018  2019a 2020a 2021a 2022  Q3a 
Revenue and grants  18.1 19.1 19.3 19.1 19.9 21.0 22.1 
 Current revenue  18.0 19.0 19.0 18.6 19.4 20.9 22.1 
 Tax revenue  (net) 17.2 17.6 18.0 17.7 18.5 20.1 21.4 
 Non-tax revenue  0.8 1.2 1.0 0.9 0.9 0.8 0.7 
 Transfers from public corporations  0.0 0.1 0.1 0.1 0.0 0.0 0.0 
 Transfers from financial public 
corporations  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Capital revenue  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Grants  0.1 0.2 0.2 0.4 0.5 0.1 0.0 
Expen diture  and net lending  19.0 19.2 20.4 20.7 29.2 25.9 22.6 
 Current expen diture  16.1 16.5 17.3 17.6 24.0 22.1 20.7 
 Compensatio n 6.6 6.5 6.5 6.7 7.8 7.3 6.8 
 Goods and services  2.5 2.1 2.3 2.3 2.5 2.3 2.1 
 Interest  2.8 3.1 3.4 3.5 4.2 4.3 4.7 
 Transfers to:  4.2 4.8 5.2 5.2 9.5 8.2 7.0 
 Rest of general government  2.8 2.7 3.0 2.9 4.0 3.6 3.8 
 Public corporations  0.0 0.2 0.0 0.0 0.1 0.0 0.1 
 Financial p ublic corporations  0.0 0.1 0.1 0.2 0.8 0.8 0.3 
 Private sector  1.3 1.8 2.0 2.0 4.5 3.7 2.8 
 Rest of the world  0.0 0.0 0.1 0.0 0.0 0.0 0.1 
 Capital expenditure  2.9 2.7 3.0 3.1 3.3 3.8 1.9 
 Gross investment  1.2 1.0 1.4 1.4 1.8 1.9 1.3 
 Transfers to:  1.7 1.7 1.6 1.7 1.5 1.9 0.7 
 Rest of general government  1.5 1.4 1.4 1.4 1.2 1.7 0.0 
 Public corporations  0.0 0.0 0.0 0.0 0.1 0.0 0.0 
 Financial p ublic corporations  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Private sector  0.2 0.3 0.2 0.2 0.2 0.2 0.6 
 Net lending  0.0 0.0 0.0 0.0 1.9 0.0 0.0 
 Rest of general government  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Public corporations  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Financial p ublic corporations  0.0 0.0 0.0 0.0 1.9 0.0 0.0 
 Private sector  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
Current saving  1.9 2.5 1.7 1.0 -4.6 -1.2 1.4 
Primary saving  4.7 5.6 5.1 4.5 -0.4 3.2 6.1 
Overall surplus /deficit  -1.9 -0.3 -2.5 -3.7 -19.0 -9.9 -1.0 
 Including grants  -0.9 -0.1 -1.1 -1.6 -9.2 -4.9 -0.5 
 
Compliance with Tax Obligations in view of the National Emergency declared in response to the COVID -19 
Pandemic, of 19 May 2020, respectively.  
15 IMF, Policy Responses to COVID -19. Viewed at: https://www.imf.org/en/Topics/imf -and-
covid19/Policy -Responses -to-COVID-19. WT/TPR/S/440  • El Salvador  
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2016  2017  2018  2019a 2020a 2021a 2022  Q3a 
 Excluding grants  -1.0 -0.2 -1.3 -2.0 -9.8 -5.0 -0.5 
Net external financing  0.5 0.9 0.5 0.9 5.3 2.9 -0.3 
 Debt disbursements  2.5 3.4 2.3 1.1 3.1 3.9 2.1 
 Bond placement  0.0 0.0 0.0 3.6 3.4 0.0 0.0 
 Debt amortization  -1.9 -2.4 -1.8 -3.8 -1.2 -0.9 -2.4 
Net domestic financing  0.3 -0.9 0.6 0.7 3.9 2.0 0.8 
 Central Bank  -0.5 0.1 -0.1 0.0 -0.1 0.1 1.3 
 Commercial banks  0.0 -0.8 0.4 0.5 2.6 1.4 -0.4 
 Financial institutions  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Bonds outside the banking system  0.5 0.0 0.4 0.5 1.3 1.0 0.1 
 Other  0.3 -0.2 -0.1 -0.2 0.2 -0.4 -0.2 
 Privatization and sale of shares  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Pension  system  payments  0.0 0.0 0.0 0.0 0.0 0.0 0.0 
 Other  0.3 -0.2 -0.1 -0.2 0.2 -0.4 -0.2 
Memorandum item       
 
 Total pensions and trusts  -2.1 -2.2 -1.4 -1.3 -1.2 -1.0 -0.9 
 Pension Liabilities Trust  -2.1 -2.2 -1.4 -1.3 -1.2 -1.0 -0.9 
Surplus (deficit) including pensions 
and trusts  -3.0 -2.3 -2.5 -2.9 -10.4 -5.9 -1.4 
Central government debt   49.0  48.2  47.7  48.0  62.8  58.6 72.9 
 Foreign debt  34.6  34.8  33.2  33.8  41.5  38.2 45.5 
 Domestic debt  14.4  13.4  14.5  14.2  21.3  20.5 27.4 
Public debt   72.6  73.6  72.9  73.7  92.1  84.8 105.4  
 Foreign debt  38.5  38.7  36.8  37.1  45.4  41.5 49.1 
 Domestic debt  34.1  34.8  36.2  36.6  46.7  43.3 56.3 
a Preliminary data.  
Source:  El Salvador Ministry of the Economy.  
1.26.  During the first months of 2022, the fiscal position continued to improve and the central 
government recorded a surplus of 1.4 % of GDP, including pensions and trusts, in the third quarter 
of 2022. This largely reflected the increase in tax revenues, which were equivalent to 21.4 % of GDP, 
coupled with a cut in expenditure.  
1.27.  Public debt remained relatively stable as a percentage of GDP until 2019, but increased sharply 
in the wake of the pandemic, rising from 72.6 % of GDP in 2016 to a peak of 92.1 % in 2020, before 
falling to 84.8 % of GDP in 2021 . Foreign debt amounted to 41.5 % of GDP in 2021, and domestic 
debt was 43.3%. 
1.2.3   Monetary and exchange rate policy  
1.28.  The Central Reserve Bank of El Salvador (BCR)  is responsible for the conduct of monetary and 
exchange rate policy . Pursuant to the Organic Law of the Central Reserve Bank of El Salvador, the 
fundamental purpose of the Central Bank is to ensure currency stability and its essential goal is to 
promote a nd maintain the most favourable monetary, exchange, credit and financial conditions for 
the stability of the national economy . In accordance with its Organic Law, the BCR is responsible 
for: preventing or moderating inflationary and deflationary tendencies ; maintaining the liquidity and 
stability of the financial system ; promoting the development of an efficient, competitive and solvent 
financial system ; regulating the expansion of credit in the financial system ; ensuring the normal 
functioning of domestic and foreign payments ; adapting the level of the means of payment to the 
development of production ; administering the country's international reserves and the international 
exchange operations regime ; laying down the corresponding policies and regulations i n monetary, 
credit, exchange and financial matters ; coordinating its policies with the Government's economic 
policy ; and carrying out the activities, operations and services established by law and other 
provisions consistent with its nature as a central bank.16 
1.29.  The BCR focuses on managing the following strategic areas for the national economy : 
(a) regulation and monitoring of the financial system ; (b) payment system and financial services ; 
(c) statistics, analysis and short - and medium -term macroe conomic projections ; (d) economic and 
financial research and advice to the Government ; (e) serving as financial agent of the State; 
 
16 Information from the Central Reserve Bank of El Salvador. Viewed at: https://www.bcr.gob.sv/ley -
organica/ . WT/TPR/S/440  • El Salvador  
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  (f) service to importers and exporters ; and (g) management of international reserves .17 In its 
functions of regulatin g and m onitoring the financial system, the BCR proposes regulations, and 
checks that financial institutions comply with liquidity reserve requirements, which are the funds 
that each bank must hold in proportion to its deposits, for the security of its depositors . The BCR is 
the financial agent of the State and, as such, receives deposits from the Government, makes 
payments on its behalf, advises it on the placement of debt securities, administers these issuances , 
and ensures that payments pertaining to foreign loa ns are honoured . In addition, since 2011, the 
BCR has served as the headquarters of the Import  and Export Processing Centre  (CIEX ), which 
provides information and authori zation services for Salvadoran exporters and importers.  
1.30.  The US dollar has been legal t ender and unit of account of the financial system since the entry 
into force of the Law on Monetary Integration on 1 January  2001.18 This Law eliminated three of the 
BCR's main functions : monetary policy management, serving as lender of last resort to the banking 
system, and issuing currency . As a dollarized economy El Salvador cannot conduct an independent 
monetary policy, and therefore the BCR's activities are chiefly limited to manag ing the  liquidity 
reserve.  
1.31.  El Salvador was the first country to introduce bitcoin as legal tender  by means of  
Decree  No. 57, or the Bitcoin Law, on 8 June 2021 (Box 1.1) . The aim of this policy is to foster 
financial inclusion, as the preamble to the Law states that approximately 70 % of the population does 
not have access to traditional financial services, and that the State is required to facilitate the 
financial inclusion of its citizens . According to the preamble, in order to boost the country's economic 
growth, it is necessary to authori ze the circulation of a digital currency whose value obeys solely  
free market criteria, "in order to increase national wealth for the benefit of the greatest number of 
citizens".  
Box 1.1 The Bitcoin Law  
The main features of the Bitcoin Law are as follows:  
• Bitcoin is unconditional legal tender, to be accepted without restriction in any transaction and  as 
payment  for any financial obligation that natural or legal persons, public or private, have to 
discharge . 
• The exchange rate between bitcoin and US  dollar s shall be freely set by the market  
• All prices may be expressed in bitcoin.  
• All tax es may be paid in bitcoin.  
• Transactions in bitcoin shall not be subject to capital gains taxes in the same way as any legal 
tender.  
• For accounting purposes, the dollar shall be used as the reference currency.  
• All economic agents must accept bitcoin as a form of payment when it is offered by the  person 
acquiring a good or service.  
• Without prejudice to the activities of the private sector, the State shall provide alternatives that 
allow users to carry out transactions in bitcoin, and to have automatic and instantaneous 
convertibility from bitcoin to dollar s should they so wish.  
• All monetary obligations expressed in dollars, existing prior to the enactmen t of the Bitcoin Law, 
may be paid in bitcoin.  
Source:  Bitcoin Law . 
1.32.  The BCR issued technical standards to facilitate the implementation of the Bitcoin Law in 
August  2021.19 The main points are set out in Box 1.2 below . 
 
17 Information from the Central Reserve Bank of El Salvador. Viewed at: 
https://www.bcr.gob.sv/funciones/ . 
18 Decree No.  201 of 11 December 2000. The Law on Monetary Integration may be viewed at 
https://ssf.gob.sv/wp -content/uploads//ssf2018/Otras%20Leyes/Ley_integracion_monetaria.pdf . 
19 Central Reserve Bank of El Salvador, Normas Técnicas para Facilitar la Aplicación de la Ley Bitcoin , 
18 August 2021. Viewed at: 
https://www.bcr.gob.sv/regulaciones/upload/Normas_Tecnicas_para_Facilitar_la_Aplicacion_de_la_Ley_Bitcoin
.pdf. WT/TPR/S/440  • El Salvador  
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  Box 1.2 Technical standards to facilitate the implementation of the Bitcoin  Law, 
August  2021 
Technical standards to facilitate the implementation of the Bitcoin Law , of 17 August  2021 
The parties required to comply with the Rules are banks, cooperative banks , and savings and credit societies 
that are interested in providing the service of converting dollars to bitcoin and vice versa, through providers 
of: (a) bitcoin and dollar digital wallets ; (b) digital exchange houses or exchanges for bitcoin and dollars ; 
(c) bitcoin and dollar payment service providers ; and (d) any other agent in the value chain of the product or 
service related to these Standards , such as : bitcoin -related technology custodians and providers.  
1. The products and services referred to in these bitcoin standards  are considered to be legal tender in the 
territory of El Salvador only.  
2. Bitcoin is defined by the Bitcoin Law as legal tender  that uses blockchain technology.  
3. A digital wallet for bitc oin and dollars is defined as the digital record of bitcoins or dollars for a natural or 
legal person , which shall be housed  on a digital platform.  
4. Bitcoin ATMs are being installed to allow customers to make, inter alia , cash withdrawals, transfers 
between accounts and payments for services.  
5. The concept of digital exchange house is established, defined as a bitcoin or dollar exchange house , 
incorporated as a corporation authori zed by the Superintendency of the Financial System, whose regular 
activity is the purchase and sale of bitcoin through an electronic platform or computer applications at prices 
determined by market supply and demand.  
6. Bitcoin custodians are  constituted : companies engaged in the provision of custody services, on behalf  of 
third parties, of bitcoin or the means of access ing said bitcoin, in the form of private encryption keys.  
7. Bitcoin and dollar  payment service providers are defined as public limited companies with fixed capital 
whose purpose shall be restricted to the provision of bitcoin and dollar  payment services.  
8. Entities wishing to conduct bitcoin transactions must maintain sufficient financial and non -financial 
resources to provide their services and satisfy their customers ; have effective means for the pro tection of 
customers' assets and money when responsible for them ; have effective corporate governance 
arrangements ; ensure that their security access systems and protocols are maintained to high standards ; 
have systems in place to prevent, detect and discl ose financial crime risks, such as money - and 
asset -laundering, terrorist financing and the financing of the proliferation of weapons of mass destruction ; 
and be resilient and have contingency arrangements for the orderly and solvent liquidation of their b usiness.  
9. Service providers are under the obligation to keep information on operations carried out in a secure means 
of storage for a period of 15 years from the date of completion of each operation ; as regulated entities, they 
must also comply with the  provisions of the Anti -Money - and Asset -Laundering Law, its regulations and other 
relevant , nationally -applicable regulations and instructions.  
10. Furthermore, they must apply international standards concerning the prevention of money - and 
asset -laundering , and financing of terrorism and the proliferation of weapons of mass destruction, they must 
therefore establish a monitoring framework and have software that allows transactions  to be analysed , 
complying at least with the following : (a) a risk-based approach and management measures ; (b) the 
traceability and transfer of customer information ; (c) customer due diligence ; (d) due diligence of politically 
exposed persons ; (e) the mitigation of new technologies ; (f) the monitoring, control a nd reporting of wire 
transfers ; (g) internal controls ; and (h) the reporting of suspicious and other transaction s. 
11. Customers should be provided with clear and timely information regarding the services provided and the 
conditions of access to such serv ices, including fees and commissions.  
12. Banks, cooperative banks and savings and credit societies interested in providing bitcoin and dollar 
convertibility services and vice versa shall submit to the Superintendency of the Financial System a no 
objectio n application to provide bitcoin and dollar convertibility services, with support ing documents.  
13. Persons subject to the Standards may contract bitcoin -to-dollar convertibility services, digital wallets, 
custody and other services at their own expense and under their own responsibility.  
14. Responsibilities of the digital wallet provider : the financial institution must ensure that the electronic 
platform of the digital wallet allows  bitcoin to be converted to dollars and dollars to bitcoin . The digital wallet 
provider assumes full responsibility vis-à-vis the customer for all transactions and services carried out 
through the electronic platform and is liable to its customer for any non -compliance.  
15. The entity must provide customers, through electronic means, with information prior to entering into the 
service contract, detailing, inter alia , the volatility of the value of bitcoin ; the fees to be charged ; and the 
inherent fraud and cyber risks.  
Source:   Central Reserve Bank of El Salvador , Normas Técnicas para Facilitar la Aplicación de la Ley Bitcoin , 
18 August  2021. Viewed at: 
https://www.bcr.gob.sv/regulaciones/upload/Normas_Tecnicas_para_Facilitar_la_Aplicacion_de_la_L
ey_Bitcoin.pdf . 
1.33.  In order to support bitcoin operations and assume part of the risk thereof, the Law creating 
the Bitcoin Trust20 was adopted in  August  2021, with a capital of USD 150 million , the purpose of 
which is to constitute and regulate the operation of the "Fidebitcoin " (bitcoin  trust), creat ing the 
 
20 Legislative Decree No. 137 of 31 August 2021 . WT/TPR/S/440  • El Salvador  
- 23 - 
  digital wallet , Chivo Wallet .21 The administrative agent is the Development Bank of  El Salvador 
(BANDESAL) . As administrator of the trust's resources and the digital wallet, BANDESAL must keep 
a register of persons who are eligible to access  it, to send, receiv e and instantly convert USD to 
bitcoin .22 A one-time signup bonus in the amount equivalent to USD 30 is given to users who are 
natural persons . The administrator of the digital wallet shall carry out the necessary checks to 
prevent asset laundering, terrorist financing, and/or to protect against fraud, any crime or the 
violation of legal regulations . The trust shall provide the administrator of the digital wallet with the 
financial resources necessary for the fulfilment of  the objectives of Fidebitcoin . 
1.34.  The BCR does not keep separate statistics regarding the use of bitcoin, as according to the 
Bitcoin Law the USD is the unit of account . It is therefore difficult to quantify its use . An estimated 
4 million  users avail themse lves of the Chivo e -wallet.  
1.35.  During the period under review and to address the negative effects of the pandemic, the BCR 
implemented a series of measures to facilitate access to credit and ease the financial burden on 
individuals and businesses . These inclu de reducing banks' reserve requirements by 25 % for newly 
issued loans ; reducing banks' statutory reserve requirements for various liabilities by about 12 %, to 
around 9% of deposits ; modifying provisions for bad loans by freezing credit ratings ; imposing a 
temporary moratorium on credit risk ratings ; and temporarily relaxing lending conditions through a 
grace period for loan repayments . Moreover, the President of the Republic championed  the 
establishment of a USD 650 million  trust fund , administere d by BANDESAL , to support workers and 
SMEs.23 
1.36.  Interest rates remained stable during the period under review . The lending rate for loans with 
a term of up to one year ranged between 6.1 % and 6.6 %. Although nominal rates were low, real 
rates were relatively high  in some years , particularly in 2019 , when inflation was negative, but rates 
fell in 2021 when inflation rose.  
1.37.  Inflation, measured as the average annual change in the Consumer Price Index (CPI), 
remained at very reasonable levels for most of  the period under review, ranging from -0.1% in 2019 
to a peak of 2 % in 2017 . From 2021 onwards, however, with accelerating growth and external 
inflationary pressures, prices started to increase . The CPI change for 2021 was 6.1 % and 7.4 % in 
the 12 months e nding in July 2022. The CPI trend was partly affected by the hike in the international 
price of food and raw material s, and the  supply shortages, despite the appreciation of the US dollar 
against  other currencies, which had a mitigating effect.  
1.38.  El Salvador  does not impose any controls on foreign currency transactions.  
1.2.4   Balance of payments  
1.39.  The balance -of-payments current account of El Salvador ran a growing deficit between 2016 
and 2018, rising to USD 859 million (3.3 % of GDP) (Table 1.3) . In 2019, the deficit narrowed to 
USD 113 million , equivalent to 0.4 % of GDP . In 2020, as an effect of the pandemic, both exports 
and imports of goods and services dropped , but imports fell by a larger proportion, and a surplus of 
USD 203 million  (0.8% of GD P) was recorded . In 2021, as the economy recovered, the 
balance -of-payments current account deteriorated to a deficit of USD 1,457 million , or 5.1 % of GDP . 
In the first three quarters of 2022, the deficit amounted to USD 2,073 million , or 8.9 % of GDP, 
mainly due to an increase in the merchandise trade deficit.  
Table 1.3 Balance of payments, 2016 -22 Q3  
(USD million )  
2016  2017  2018  2019  2020a 2021a 2022 Q3a 
1. Current account  -550 -465 -859 -113 203 -1,457  -2,073  
 Goods and services  -3,846  -4,111  -4,758  -4,412  -4,469  -7,263  -6,339  
 Goods  -4,654  -4,845  -5,640  -5,709  -5,147  -8,208  -7,486  
 
21 Online information from Chivo Wallet. Viewed at: 
https://www.chivowallet.com/index.html#beneficios . 
22 Regulations governing the operation of Fidebitcoin . Viewed at: 
https://www.bandesal.gob.sv/reglamento/ . 
23 IMF, Policy Responses to COVID -19. Viewed at: https://www.imf.org/en/Topics/imf -and-
covid19/Policy -Responses -to-COVID -19. WT/TPR/S/440  • El Salvador  
- 24 - 
   
2016  2017  2018  2019  2020a 2021a 2022 Q3a 
 Exports (f.o.b)  4,322  4,667  4,736  4,748  4,142  5,385  4,596  
 Imports (f.o.b.)  8,976  9,512  10,376  10,457  9,289  13,592  12,082  
 Services  808 733 882 1,297  678 945 1,147  
 Credits  2,549  2,557  2,829  3,309  2,153  3,106  3,139  
 Debits  1,741  1,824  1,947  2,012  1,475  2,162  1,992  
 Primary income  -1,246  -1,388  -1,470  -1,341  -1,315  -1,624  -1,370  
 Compensation of employees  -31 -26 -36 -34 -21 -22 -2 
 Investment income  -1,216  -1,362  -1,434  -1,307  -1,294  -1,602  -1,368  
 Direct investment  -821 -914 -952 -854 -844 -1,125  -882 
 Portfolio investment  -252 -298 -308 -308 -307 -315 -303 
 Other investments  -170 -187 -250 -246 -191 -173 -206 
 Reserve assets  26 37 75 100 48 12 23 
 Secondary income  4,542 5,035 5,369 5,640 5,987 7,431 5,636 
 General government  10 95 24 14 99 81 110 
 Financial  corporations,  
non-financial corporations , 
households  and NPISHs  4,532  4,939  5,345  5,625  5,887  7,349  5,526  
 Personal transfers  4,427  4,835  5,238  5,457  5,765  7,248  5,453  
 Of which : Workers ' 
remittances  4,544  4,978  5,373  5,631  5,911  7,465  5,636  
 Other transfers  105 104 108 168 123 101 73 
2. Capital account  70 85 203 248 300 266 214 
 Capital transfers  70 85 203 248 300 266 214 
 General government  16 30 118 156 212 140 104 
 Financial corporations, 
non-financial corporations , 
households  and NPISHs  54 55 86 92 89 126 110 
3. Net lending (+) / borrowing 
(-) (Current and capital account 
balance)  -480 -380 -656 134 503 -1,191  -1,859  
4. Financial account net lending 
(+)/ borrowing ( -) -787 -552 -1,248  -139 -1,207  -1,500  -866 
 Direct investment  -348 -889 -826 -636 -281 -313 45 
 Equity and investment fund 
shares  -425 -844 -129 -575 -88 -699 159 
 Debt instruments  77 -45 -697 -61 -193 385 -113 
 Portfolio investment  -365 -321 110 -17 251 -303 324 
 Equity and investment fund 
shares  1 0 0 20 518 60 55 
 Debt securities  -366 -321 109 -38 -267 -363 270 
 Financial derivatives  0 0 0 0 0 0 0 
 Other investments  -526 351 -533 -361 210 -1,242  -1,632  
 Other equity  0 0 -7 0 0 0 0 
  Currency and deposits  339 272 -297 30 525 339 -321 
 Loans  -692 25 -236 -37 -588 -1,257  -578 
 Insurance, pensions and 
standardized guarantee 
schemes  .. .. .. 0 0 155 102 
 Commercial loans  -4 -3 -68 -46 -78 -191 -83 
 Other accounts 
receivable/payable  -169 56 75 -308 351 101 -751 
 Special drawing rights  0 0 0 0 0 -390 0 
  Reserve assets  452 308 2 876 -1,387  359 396 
5. Errors and omissions  -307 -172 -592 -273 -1,711 -309 993 
6. Memorandum item: Foreign 
direct investment in El Salvador 
(net) 347 889 826 636 280 314 -45 
Memorandum         
Current account (% of GDP)  -2.3 -1.9 -3.3 -0.4 0.8 -5.1 -8.9 
Total foreign debt (millions of USD)  16,376  16,474  16,603  17,350  18,731  20,286  21,133  
.. Not available.  
a Preliminary data.  
Note:  The country's family remittances are included and divided between two balance -of-payments 
accounts : (a) the current a ccount, as secondary income of financial  corporations,  non-financial 
corporations, households and NPISHs , and within these under  the sub -account of personal transfers, 
particularly workers' remittances ; and (b) the capital account , under  financial  corporations,  
non-financial corporations, households and NPISHs, as long as they are destined for a Salvadoran 
household.  
Source:  Central Reserve Bank of El Salvador.  WT/TPR/S/440  • El Salvador  
- 25 - 
  1.40.  The deficit in the balance of trade in goods grew between 2016 and 2019, before improving 
in 2020 as a result  of the pandemic . However, it reached a record level in 2021, when it totalled 
USD 8,208 million. M eanwhile, the servi ces balance has been in surplus during the period under 
review (see below) . The goods trade balance recorded a deficit of USD  4,918  million  in the first half 
of 2022, an increase of USD 1,243 million  (34%) over the first half of 2021 .24 The cumulative defi cit 
in the first three quarters of 2022 amounted to USD  7,486  million.  
1.41.  As noted in the previous review, the current account deficit has continued to be offset by the 
high level of current transfers, mainly in the form of remittances from Salvadorans living  abroad . 
Remittances from abroad reached a record level of USD 7,465  million  in 2021,  equivalent to  26% of 
GDP. Remittances  amounted to USD  5,636  million  in the first three quarters of 2022 . 
1.42.  The balance -of-payments financial account has run a deficit durin g the entire period under 
review, reflecting the rise in net borrowing . Net FDI flows have averaged 2 % of GDP . The level of 
net international reserves was USD 2,941 million  as of September  2022. Of these  reserves , 78% 
were held in the investment portfolio.  
1.43.  At 30 September  2022, the total foreign debt stock amounted to USD 21,133  million (nearly 
75% of GDP).  
1.3  Developments in trade and investment  
1.3.1   Trends and patterns in merchandise and services trade  
1.3.1.1   Merchandise trade  
1.44.  Merchandise trade continued to increase during the period under review, with the exception 
of 2020 due to the effect of the pandemic . However, in 2021, there was a strong recovery in both 
maquila  imports and exports relative to the respective totals . Total tra de (including maquila ) reached 
USD 21,704.7  million in 2021, equivalent to just over two  thirds of GDP.  
1.45.  Cumulative Salvadoran e xports reached USD 5,688.9  million  by September  2022, exceeding 
the same period in 2021 by USD 757.6  million , which represented growth of 15.4 %. This is the  result 
of the additional contribution of traditional goods , in the amount of USD 83.2 million ( an extra 
33.2%), non -traditional goods  worth  USD 530.6 million  (14.2 %) and maquila  worth 
USD 143.9  million (15.1 %).25 
1.46.  Merchandise imports as of September  2022 totalled USD 13,488.2  million , up by 24.4 % 
(USD  2,644.4  million)  over the same period in 2021 . 
1.3.1.1.1   Composition of merchandise trade  
1.47.  Charts 1.1 and 1.2 , and Tables A1.1 -A1.4, show the composition of trade during the period 
under review . The structure of El Salvador's exports did not change substantially in the period from 
2016 to 2021, as the share of textiles and apparel remained above or around one  third of the total, 
exclud ing maquila  exports . In the case of maquila  exports , textile and apparel exports continued to 
account for the largest share , and their percentage of the total falling from 79.3 % in 2016 to 69.9 % 
in 2021 . Prepared foodstuffs  remained the second largest non -maquila  export category, representing 
17.1% of the total in 2021 . They are followed by plastics, paper and chemicals.  
1.48.  Of the USD 5,688.9  million -worth of  export s as of September  2022, manufacturing industries 
export s were valued at  USD 5,417.2  million, a year-on-year increase of 13.9%. The main industry 
sectors were the maquila  industry ( USD 1,099. 2 million ), apparel (USD 1,014. 1 million ), prepared 
foodstuffs  (USD 796.3 million ), textile products (USD 444.5 million ), and rubber and plastic 
products (USD 426.6 million ). Among maquila  products, the most important were apparel 
 
24 Central Reserve Bank of El Salvador, " El Salvador exportó USD  3.802,3  millones en el primer 
semestre de 2022 con un crecimiento de 16,8 %". Press release of 18 July 2022.  
25 Central Reserve Bank of El Salvador.  WT/TPR/S/440  • El Salvador  
- 26 - 
  (USD 729.6 million , year-on-year growth of 10.4% compared to September  2021) and electr ical 
capacitors (USD 202.5  million , +12.7 %). 
1.49.  Regarding imp orts, manufactured products accounted for one  third of the total in 20 21. 
Machinery, transport equipment, textiles, plastics and chemicals account for a large share of 
manufacturing imports (Table A1.4) . Imports of mineral products, mostly fuels, slightly increased 
their share of total imports , up to 14.3 % in 2021.  
1.50.  Of the USD 13,488. 2 million -worth of  import s as of the third quarter of 2022, consumer goods 
accounted for USD 5,018.9  million ( a year -on-year increase of USD 887.4  million) . Imports of 
intermediate goods reached USD  5,707.8  million ( up 31.4% compared to the same period in 2021) . 
Meanwhile , the value of imports of capital goods reached USD 2,101.3  million (+15.1 %). Imports 
of information and communication technology (ICT) goods totalled USD 540.77  million, with 
computers and communication equipment accounting for USD 284.4  million and USD 116.4  million, 
respectively . Imports of petroleum products amounted to USD 2,186.9  million (+70.2 %), mainly 
gasoline ( USD 703.5  million), diesel ( USD 619.7  million), propane and liquefied gas 
(USD 334.6  million), fuel oil ( USD 90.7 million) and kerosene for jet engines ( USD 135.0  million).26 
1.3.2   Direction of trade  
1.51.  El Salvador's main export markets (excluding maquila  exports ) continue to be the other 
members  of the Central American Common Market (CACM) and the United States (Chart 1.3 and 
Table A1.5) . Within the Central American region, Guatemala has become the leading destination for 
El Salvador's exports, accounting for 17.3% of the total in 2021, compared with 13.7 % in 2016 . It 
is followed by Honduras , with 16.4 % in 2021 (14.1 % in 2016) , and Nicaragua , with 7.4 % (7.2% in 
2016) . Although its share of the total declined, t he United States remained the main destination for 
Salvadoran exports, accounting for 39 .9% of the total in 2021, compared to 47.2 % in 2016.  
1.52.  The United States continues to be El Salvador's main supplier of  goods . However, its relative 
weight as a source of imports decreased in the period under review, having been the provenance of 
27.1% of imports (including maquila  products ) in 2021, compared to 32.3 % in 2016 . China was 
El Salvador's second largest single supplier in 2021, accounting for 16.8 % of the total, followed by 
Guatemala (10.6 %) and Mexico (8.1 %) (Table A1.6) . The share of impor ts from the European Union 
was 6.0 %, with Spain, Germany and Italy being the main  European  exporters.  
1.53.  As of the third quarter of 2022, exports to the United States (including maquila  products ) 
totalled USD  2,197.6  million, up 10.6% (USD 210.6 million) year-on-year, and accounted for 38.6 % 
of total exports . Exports to the Central American region made up  45.1% of the total 
(USD 2,567. 4 million), with Guatemala and Honduras accounting for 17.1% and 16.7 % 
(USD  976.9 million and USD  952.6 million, respectively) of total exports . The main products 
exported in the third quarter of 2022 were knitted T-shirts and singlets  with USD  637.9  million, 
followed by jerseys , pullovers and similar articles (USD  402.8  million), plastic articles for the 
conveyance or packing  of goods  (USD  246.6  million), electrical capacitors or electronic microchips 
(USD  202.5  million) and cane sugar (USD 182.4  million ).27 
1.54.  As of the third quarter of 2022, 69.7 % of total imported goods originated from only 
five trading partners : the United States with USD  3,959.4  million (29.4 % of the total) ; China with 
USD 2,198.9  million (16.3 % of the total) ; Guatemala with USD  1,411.2  million (10.5 %); Mexico 
with USD  1,061.5  million (7.9 %) and Honduras with USD  773.5  million (5.9 %). 
 
26 Information from the Central Reserve Bank of El Salvador.  
27 Information from the Central Reserve Bank of El Salvador.  WT/TPR/S/440  • El Salvador  
- 27 - 
  Chart 1.1 Non-maquila  merchandise trade , by main products, 2016 and 2021  
 
Source:  WTO Secretariat calculations , based on data from the Central Reserve Bank of El  Salvador.  
2016 2021
(a)    Exports
Total: USD 4,316 million
(b)    Imports
Total: USD 9,391 million Total: USD 14,370 millionTotal: USD 5,377 millionOther
9.2%Other
9.0%
Mineral 
products
12.8%
Chemicals
12.3%
Plastics
7.2%Electrical 
machinery 
and 
appliances
14.8%Other
12.5%
Mineral 
products
14.3%
Chemicals
11.6%
Plastics
7.3%Bsae metals
8.3%Electrical 
machinery and 
appliances
15.9%Other
11.2%
Base 
metals
5.8%
Textiles
11.3%Vegetable 
products
4.9%Vegetable 
products
4.4%
Transport 
equipment
5.4%Transport 
equipment
6.2%Mineral 
products
3.9%Prepared 
foodstuffs
16.7%Prepared 
foodstuffs
17.1%
Mineral 
products
4.9%
Vegetable 
products
5.0%Vegetable 
products
4.6%
Textiles
8.2%Plastics
7.7%
Paper, pulp 
of wood
6.7%Textiles
38.1%
Plastics
9.2%Base 
metals
6.7%
Textiles
33.2%Chemicals
7.6%Chemicals
7.0%Base metals
5.8%
Paper, pulp 
of wood
7.8%
Animal 
products
3.6%
Prepared 
foodstuffs
9.2%Animal 
products
4.2%
Prepared 
foodstuffs
8.2%WT/TPR/S/440  • El Salvador  
- 28 - 
  Chart 1.2 Trade in maquila  goods,  by main  products,  2016 and 2021  
 
Source:  WTO Secretariat calculations , based on data from the Central Reserve Bank of El Salvador.  
2016 2021
(a)    Exports
Total: USD 1,104 million
(b)    Imports
Total: USD 434 million Total: USD 706 millionTotal: USD 1,252 millionOther
1.0%Other
0.4%
Chemical 
products
3.6%Plastics
5.5%Electrical 
machinery 
and  
appliances
2.5%Other
8.9%Chemicals
4.9%Plastics
5.5%Electrical 
machinery and  
appliances
4.1%Other
8.1%
Base metals
12.5%
Textiles
68.1% Textiles
69.8%Plastics
0.3% Electrical 
machinery 
and  
appliances
19.1%Plastics
2.1%Electrical 
machinery 
and 
appliances
24.6%Chemicals
3.0%Chemicals
0.3%
Textiles
79.3%Textiles
69.9%
Base metals
15.1%WT/TPR/S/440  • El Salvador  
- 29 - 
  Chart 1.3 Merchandise tr ade, by trading partner, 2016 and 2021  
 
Source:  WTO Secretariat calculations , based on data from the Central Reserve Bank of El  Salvador.  
1.3.2.1   Trade in services  
1.55.  Despite the crisis caused by the pandemic, the balance of trade in services was in surplus 
throughout the period under review . This surplus gradually increased between 2017 and 2019, when 
it reached USD 1,297 million , which is equivalent to 4.8 % of GDP . The largest surpluses were under 
the "travel" item and in the value added of maquila  activiti es, in the category "Manufacturing services 
on physical inputs owned by  others" . The trade balance shows deficits in most other services 
categories, with the exception of telecommunications, computer and information services, 
government services, and, more  recently, other business services (Table 1.4) . The largest deficits 
were in transport and insurance and financial services.  
2016 2021
(a)    Total exports
Total: USD 5,420 million
(b)    Total imports
Total: USD 9,826 million Total: USD 15,076 millionTotal: USD 6,629 millionGuatemala
13.7%Other
0.2%
United States
47.5%Other 
Americas
12.1%
Guatemala
10.1%Americas
93.2%United States
39.9%Other 
Americas
12.2%
Nicaragua
7.4Other
0.2%Asia
3.5%
Americas
96.4%Asia
2.1%
United States
32.3%
Other 
Americas
13.3%
Mexico
7.5%China
14.3%Other 
Asia
5.7%Other
0.6%
United States
27.2%
Other 
Americas
12.1%China
16.8%Other 
Asia
6.3%Other
1.4%
Americas
68.3%Americas
63.9%Europe
7.1%Europe
7.1%Asia
24.0%Asia
27,6%Europe
3.2%
Nicaragua
7.2%
Honduras
5.8%Guatemala
10.6%Guatemala
17.3%
Japan
2.1%Japan
2.3%Europe
3.1%
EU-27
6.1%
EU-27
6.0%Other 
Europe
1.0%
Other Europe
1.1%Honduras
14.1%Honduras
16.4%
Honduras
5.1%Mexico
8.1%Korea, 
Rep. of
1.8%Korea, 
Rep. of
2.4%WT/TPR/S/440  • El Salvador  
- 30 - 
  Table 1.4 Balance of trade in services, 2016 -22 Q3 
(USD million )  
2016  2017  2018  2019  2020  2021  2022  Q3 
SERVICES BALANCE  808 733 882 1,297  678 945 1,147  
Credit  2,549  2,557  2,829  3,309  2,153  3,106  3,139  
 Manufacturing services on physical 
inputs owned by others  663 482 561 539 423 573 464 
 Maintenance and repair  service s 136 190 264 321 250 376 320 
 Transport  451 483 476 526 273 441 453 
 Travel  829 873 1,014  1,306  636 993 1,290  
 Construction  12 21 18 34 18 9 5 
 Insurance and pension  service s 43 40 42 47 24 49 40 
 Financial  services  49 58 54 72 64 75 53 
 Charges for the use of intellectual 
property  56 62 8 3 1 0 0 
 Telecommunications, computer and 
information services  184 204 218 244 236 324 277 
 Other business services  66 78 95 109 124 140 119 
 Personal, cultural and recreational  
services  0 0 0 0 0 0 0 
 Government goods and services  60 66 80 109 104 128 118 
Debits  1,741  1,824  1,947  2,012  1,475  2,162  1,992  
 Manufacturing services on physical 
inputs owned by others  0 0 0 0 0 0 0 
 Maintenance and repair  service s 45 84 116 141 71 120 107 
 Transport  626 649 718 721 590 974 907 
 Travel  412 418 443 482 148 283 421 
 Construction  59 36 36 6 6 14 6 
 Insurance and pension  service s 153 157 208 211 190 214 183 
 Financial  services  140 171 153 177 213 219 109 
 Charges for the use of intellectual 
property  137 138 89 98 98 112 89 
 Telecommunications, computer and 
information services  48 53 51 56 58 82 46 
 Other business services  93 94 107 90 76 98 61 
 Personal, cultural and recreational  
services  2 2 2 2 1 0 2 
 Government goods and services  26 20 24 29 26 46 64 
Source:  Central Reserve Bank of El Salvador.  
1.56.  After shrinking in 2020, the surplus grew again in 2021 (to USD  945 million), due to increases 
in credits for travel, transport and telecommunications, and above all, due to an increase in loans to 
the maquila  industry . The trend continued in 2022, when the surplus amounted to USD  1,147  million 
in the first  three quarters of the year.  
1.3.3   Trends and patterns in foreign direct investment  
1.57.  The stock of foreign investment in El Salvador reached USD 10,378.3  million  by the end of 
2021, of which USD 3,078 million  went to the financial sector ; USD  2,499 million  went to 
manufa cturing activity ; USD  1,501 million  to retail trade ; USD  1,288 million  went to the 
telecommunications sector ; and USD 1,264 million  to the electricity sector (Table 1.5) . Transport 
was also an important sector for FDI inflows . Net flows of FDI during the r eview period amounted to 
USD 548.8  million on average.  
Table 1.5 Balance of foreign direct investment by recipient economic sector 2016 -22 Q3 
(USD million )  
2016  2017  2018  2019  2020  2021  2022 Q3a 
Agriculture  6 15 22 16 9 4 2 
Mining  51 52 52 52 52 0 C. 
Manufacturing industries  2,438  2,657  2,667  2,484  2,472  2,499  2,282  
Electricity supply  887 966 1,052  1,220  1,223  1,264  1,322  
Construction  67 33 29 28 30 31 C. WT/TPR/S/440  • El Salvador  
- 31 - 
   
2016  2017  2018  2019  2020  2021  2022 Q3a 
Wholesale and retail trade  772 855 962 1,337  1,400  1,501  1,966  
Transport and storage  49 90 182 242 226 258 261 
Information and communication s 1,255  1,215  1,098  1,006  1,353  1,288  1,181  
Financial and insurance activities  3,154  3,171  3,187  3,140  2,970  3,078  3,071  
Other sectors  367 330 415 455 424 455 477 
Totals  9,047  9,384  9,666  9,981  10,159  10,378  10,584  
C. Confidential information  
a Preliminary data.  
Note:  From 2007 to date, the figures for foreign direct investment in the country have been adjust ed 
following  the incorporation of new , updated information and methodological changes arising from the 
information from the Coordinated Direct Investment Survey (CD IS), launched by the IMF in 2009. 
Participation in the CDIS allowed  direct investment statistics to be improved and the coverage of the 
sample of enterprises surveyed  to be expanded , while initiating actions to move towards the 
adoption of the new concepts , definitions and measurements proposed by the sixth edition of the 
Balance of Payments  and International Investment Position  Manual  (BPM6) . The main changes are 
the inclusion of information on " fellow enterprises ", in addition to that traditionally used concerning 
direct investors, and the incorporation of the reserves item in the concept of direct investment, as 
well as  equity, reinvested earnings and loans between investment enterprises . Investment data are 
presented on a net basis, i.e. the assets that invested enterprises hold with their parent companies  
are deducted from direct investment liabilities , so a country's balance may eventually be negative.  
Source:  Central Reserve Bank of El Salvador.  
1.58.  Panama and the  United States are the main source of foreign investment in El Salvador, with 
investments totalling USD 4,014 million  and USD 2,146 million , respectively , in 2021 (Table  1.6). 
Other major investors were Spain, Colombia and Mexico.  
Table 1.6 Balance of foreign direct investment , by origin 2016 -22 Q3 
(USD million )  
2016  2017  2018  2019  2020  2021  2022 Q3a 
Central America  463 633 802 598 540 463 546 
 Costa Rica  82 81 88 86 75 52 37 
 Guatemala  297 332 528 338 266 164 214 
 Honduras  91 220 197 177 205 258 306 
 Nicaragua  -7 0 -12 -2 -6 -11 -11 
Other countries  of the Americas  7,338  7,466  7,618  7,977  7,937  8,201  8,112  
 Bahamas  19 19 19 27 68 65 52 
 Bermuda  20 13 22 126 131 89 C. 
 Brazil  22 20 27 31 30 33 37 
 Canada  310 320 340 220 -21 -21 -21 
 Cayman Islands  7 2 1 135 186 90 160 
 Chile 0 0 0 0 6 0 C. 
 Colombia  790 731 760 843 854 894 899 
 Mexico  870 825 894 728 746 696 1,041  
 Panama  2,358  2,731  2,784  3,280  3,665  4,014  3,775  
 Peru 70 58 58 87 59 80 90 
 United States  2,470  2,606  2,432  2,204  2,059  2,146  1,814  
 Virgin Islands  402 140 281 297 155 115 128 
Europe  1,079  1,071  1,134  1,419  1,768  1,869  1,663  
 Belgium  9 10 6 9 13 15 C. 
 Czech Republic  2 4 7 7 10 12 C. 
 France  4 40 74 134 132 114 122 
 Germany  84 55 52 62 28 32 34 
 Italy 49 7 0 0 0 0 0 
 Luxembourg  2 82 22 0 7 -7 -2 
 Netherlands  49 42 56 48 61 28 44 
 Spain  829 785 825 1,071  1,408  1,546  1,278  WT/TPR/S/440  • El Salvador  
- 32 - 
   
2016  2017  2018  2019  2020  2021  2022 Q3a 
 Sweden  14 4 4 5 5 14 C. 
 Switzerland  37 40 90 82 103 116 131 
Asia 94 99 101 94 76 82 83 
 Korea , Rep. of 32 38 41 39 32 30 32 
 Japan  44 44 45 44 38 45 48 
 Singapore  0 0 0 0 0 0 C. 
 Chinese Taipei  18 18 14 11 6 6 5 
 Other countries  73 115 10 -107 -161 -236 179 
Totals  9,047  9.384  9,666  9,981  10,159  10,378  10,584  
C. Confidential information . 
a Preliminary figures.  
Source:  Central Reserve Bank of El Salvador .WT/TPR/S/440  • El Salvador  
- 33 - 
  2  TRADE AND INVESTMENT REGIMES  
2.1  General framework  
2.1.  There are three branches of power in the Republic of El Salvador: the executive, the legislative 
and the judiciary. The Court of Audit of the Republic, an institution independent of the three branches 
of Government, ensures transparency in public governance.  
2.2.  Legislative power is exercised by the Legislative Assembly, which is unicameral. The Assembly 
is compo sed of 84 deputies, representing the country's 14 departments, who are elected by direct 
suffrage and proportional representation every three years. It is responsible for drafting, approving, 
amending  and repealing domestic laws and decrees, and debating a nd ratifying international 
treaties.  
2.3.  Executive power  in El Salvador is exercised by the President of the Republic, who is elected by 
universal suffrage for a five -year term. The President of the Republic designates the ministries or 
state secretariats and appoints the ministers and vice -ministers of State. The President, 
Vice-President and ministers of State form the Council of Ministers, which is responsible, inter alia , 
for preparing the general government plan and preparing the draft state budget. The Pr esident has 
the power to negotiate, conclude and sign international treaties, conventions or agreements, and to 
direct the country's economy by deciding on economic and social policy. The most recent presidential 
election was held in February  2019.  
2.4.  Judicia l power is exercised by the Supreme Court of Justice, courts of appeal and lower courts 
(courts of first instance and magistrates' courts). The Supreme Court of Justice consists of 15 judges, 
one of whom is President of the Supreme Court, the Constitutiona l Division and the judicial branch.1 
The National Judicial Council, an independent institution, is tasked with proposing to the Legislative 
Assembly candidates for the appointment of Supreme Court judges, court of appeal judges and other 
judges. Supreme C ourt judges are appointed for a nine -year term, with five judges appointed every 
three years who can be re -elected for one three -year term.  
2.5.  The territory of El Salvador is divided into 14 departments, grouped into three geographical 
areas (western, central  and eastern), which comprise 39 districts and 262 municipalities. Each 
department is headed by a governor appointed by the President of the Republic. In turn, the 
municipalities are governed by councils consisting of a mayor, a trustee and two or more mun icipal 
advisers. Municipal councils are elected for a three -year term.  
2.6.  The power of legislative initiative rests with (i) deputies, (ii) the President of the Republic 
through their ministers, (iii) the Supreme Court of Justice in the realm of its competenc e, 
(iv) municipal councils in matters of municipal taxes, and (v) the Central American Parliament 
(through the Salvadoran deputies members of that Parliament) in matters relating to 
Central  American integration. Draft laws approved by the Legislative Assem bly are submitted to the 
President of the Republic, who is empowered to approve them and order their publication, or to veto 
them. Draft laws vetoed by the President are returned to the Legislative Assembly for 
reconsideration. However, if a two -thirds  majority of deputies ratifies the vetoed text, the President 
has to approve and publish it. Laws become binding only after being published in the Official Journal.  
2.7.  The provisions of international treaties form part of the Republic's law once they have been 
ratified and published in the Official Journal. Domestic legislative procedures must be followed in 
order for provisions requiring implementing regulations to become national law. Domestic laws may 
not amend or repeal the covenants of an international treaty  and the latter prevails in the event of 
a conflict between its provisions and those of domestic laws. International treaties may not restrict 
or in any way affect constitutional provisions. In certain circumstances, approval by the Legislative 
Assembly is  not required for the decisions and regulations of the Central American Common Market 
(CACM), and a ministerial decision suffices.  
 
1 The Supreme Court of Justice is divided into four divisions, namely, the Constitutional Division, the 
Civil Division, the Criminal Divis ion and the Administrative Litigation Division.  WT/TPR/S/440  • El Salvador  
- 34 - 
  2.2  Trade policy formulation and objectives  
2.8.  Trade policy management falls mainly under the responsibility of the Ministry of Econ omic 
Affairs (MINEC), whose functions relate to increasing production and productivity, industrial 
promotion and diversification, the efficiency of production processes, developing domestic, regional 
and international trade and opening or expanding markets  for domestic products, and examining 
and analysing determinants of the country's economic and social development. MINEC's 
responsibilities include participating in the development and implementation of trade and investment 
policy and negotiating and admin istering trade and investment -related international agreements. 
MINEC is also responsible for implementing policies relating to productive innovation and business 
competitiveness, developing the credit system, regulating and monitoring the non -metallic min ing 
sector and the hydrocarbon market, and the electronic signature system. MINEC's remit includes the 
Permanent Representation of El Salvador to the World Trade Organization (WTO) and the World 
Intellectual Property Organization (WIPO).2 
2.9.  In 2019, the support units serving the Office of the President of the Republic were expanded 
through the creation of the Secretariat for Trade and Investment and the Secretariat for Innovation.3 
These Secretariats act as coordinating bodies with the ministries and oth er governmental 
institutions. They were created to remove barriers and bottlenecks, with a view to promoting the 
country's sustained economic growth and taking advantage of the various trade instruments and 
agreements.  
2.10.  The Secretariat for Trade and Investm ent is responsible, inter alia , for (i) representing 
domestic interests in the development of bilateral trade policy and contributing to defining 
El Salvador's position in international institutions in the field of international trade and investment, 
(ii) defining and monitoring the strategic framework for trade and economic relations between 
El Salvador and the rest of the world, (iii) identifying and proposing solutions to barriers to trade, 
investment and government procurement, (iv) participating in the  negotiation of international 
treaties relating to the promotion and protection of foreign investment, (v) proposing regulations 
relating to foreign investment, and (vi) monitoring and participating in negotiations on official 
financial support for interna tionalization in international forums on export credits.  
2.11.  The responsibilities of the Secretariat for Innovation include designing strategies to improve 
the efficiency of public services through the appropriate use of information and communication 
technolog ies, promoting public policies for standardization and harmonization to ensure best 
practices in the management and quality of public services, and the ongoing, timely and transparent 
monitoring of government management.  
2.12.  The fundamental principles of El Sa lvador's trade policy continue to be to deepen 
Central  American integration, promote access to foreign markets and improve the country's 
integration into the international economy. The Government Plan (Plan Cuscatlán ), drafted in 2019 , 
sets out, inter alia, the following foreign policy objectives: (i) further Central American integration, 
based on a holistic approach, (ii) promote foreign direct investment (FDI) through institutional 
strengthening and increased regional economic integration, and (iii) boost  foreign trade by making 
use of existing trade treaties and multilateral agreements, promoting local MSMEs' exports and 
facilitating customs transit.4 
2.13.  During the review period, El Salvador developed a long -term strategy, the Trade and 
Investment Policy 20 20-50, published in 2021, setting out fundamental principles to guide 
institutional efforts to develop the Salvadoran economy. The policy establishes three key 
macro -objectives: to boost the contribution of exports to GDP, to eliminate the balance -of-payme nts 
deficit and to increase the stock of FDI.  
2.14.  The policy also defines four main aims: (a) to complete the integration of Salvadoran 
companies into global value chains, by detecting untapped export and investment opportunities 
abroad; (b) to contribute to d iversifying and transforming the output of the industrial and service 
sectors, by increasing the technological content of products, through measures to enhance the 
external competitiveness and internationalization of companies; (c) to develop the physical,  digital 
 
2 MINEC, Marco Institucional . Viewed at: https://www.economia.gob.sv/marco -institucional/ . 
3 Executive Decree No. 1 of 2 June 2019.  
4 Plan Cusc atlán. Viewed at: https://plancuscatlan.com . WT/TPR/S/440  • El Salvador  
- 35 - 
  and legal infrastructure that creates an enabling environment for foreign trade and attracts 
investment, and (d) to attract and retain investment in order to boost the development of the most 
technologically advanced industries and services, and t o better structure the productive system as 
a whole, by ensuring synergies and linkages with the local production apparatus. Two lines of action 
have been established to achieve the first aim: diversification of products and export destinations, 
and deepen ing of existing trade agreements. These lines of action are expected to achieve one of 
the proposed macro -objectives: to boost the contribution of exports to GDP. Promoting new trade 
agreements has been established as a line of action to meet the second ai m. To achieve the third 
aim, the development of infrastructure and the institutional regulatory framework has been put 
forward as a line of action. These goals and lines of action are expected to achieve the 
macro -objective of eliminating the balance -of-payments deficit. Two main lines of action have been 
identified to achieve the fourth aim  of increasing the stock of FDI : focusing on attracting and 
retaining investment in key sectors, and promoting companies' competitiveness and 
internationalization.5 
2.15.  In order to implement the strategy, an annual action plan (work plan) and a technical report 
(progress report) are prepared every four months. According to the 2021 progress report, for 
42 (91%) of the 46 projects in the 2021 work plan, either progress had be en made with their 
activities or they had been completed as planned, while for four projects (8 %), the activities showed 
some level of delay. The most notable progress included developing and starting to implement plans 
to take advantage of 13 existing tra de agreements; achieving 94 % effectiveness in complying with 
the Trade Facilitation Plan 2021; progress in automating services under the Single Window for 
Foreign Trade through the CIEX, by putting into operation modules with the Ministry of Health, the 
Ministry of Agriculture and Livestock (MAG), the National Directorate of Medicines (D NM) and the 
International Regional Organization for Plant and Animal Health (OIRSA); and submitting the draft 
amendment to the Electronic Signature Law (the certified electr onic signature service has been 
available since May  2021).6 
2.16.  The 2022 work plan establishes the following specific objectives: identify institutional projects 
related to the lines of action and thus to the objectives of the Trade and Investment Policy; establish 
institutional roles and functions based on competencies that optimize efforts to achieve the goals 
set out in the Trade and Investment Policy; and provide a tool to follow up on and monitor the 
identified projects, enabling systematic fol low-up of implementation and expected outputs, and 
determine risk factors to monitor when a project is on track and when changes are required.7 The 
progress report on the 2022 work plan, published in May  2022, details progress made in promoting 
the export s of micro - and small enterprises (MSEs); institutional regulatory improvement to facilitate 
and promote investment and to improve the business climate; boosting the trade agenda under the 
Association Agreement with the European Union; building and fitting  out a centre for business 
innovation and technological development specialized in design (Digital Nation); promoting the 
systemic management of innovation and innovation projects – Innovation DNA (Productive 
Innovation Ecosystem); non -refundable co -financ ing for business restructuring and productive 
innovation (Productive Innovation Ecosystem); programme to promote innovative, digital and 
technology -based entrepreneurship (Innovative Entrepreneurship); programme to support 
economic recovery and business co mpetitiveness (Innovative Entrepreneurship); and promotion of 
a culture of quality in production processes (Productive Innovation Ecosystem), among others.8 
2.17.  El Salvador has also developed a National Digital Agenda 2020 -30 bringing together a set of 
action s aimed at strengthening a national digital ecosystem to boost the country's sustainable 
development and social well-being . The strategy document is based on four complementary pillars: 
(i) digital identity, (ii) innovation, education and competitiveness, (iii) modernization of the State, 
and (iv) digital governance. To implement the actions of the Digital Agenda, regular meetings have 
been organized with the missions of El Salvador in New York and Vienna to establish action 
frameworks on the topics discuss ed by the e -commerce round table of the United Nations 
Commission on International Trade Law (UNCITRAL). The objective is to identify and standardize 
 
5 Secretariat for Trade and Investment (2021), Política de Comercio e Inversiones de El Salvador: Plan 
de Trabajo 2021 . 
6 Política de Comercio e Inversiones de El Salva dor 2020 -50. Informe de Avances 2021 . 
7 Plan de Trabajo 2022 de la Política de Comercio e Inversiones de El Salvador 2020 -50. 
8 Plan de Trabajo 2022 de la Política de Comercio e Inversiones de El Salvador 2020 -50. Informe de 
Avances, enero -abril 2022, mayo de 2022 . WT/TPR/S/440  • El Salvador  
- 36 - 
  technical terms and international best practices and to consider their possible implementation in the 
country. 
2.3  Trade agreements and arrangements  
2.3.1   WTO  
2.18.  El Salvador became  a Member of the GATT on 22 May 1991 and has been a Member of the 
WTO since 7  May 1995, and grants at least most -favoured -nation (MFN) treatment to all its trading 
partners. El Salvador is not cu rrently availing itself of any transition period under the 
WTO Agreements. This is its fifth trade policy review (TPR).  
2.19.  El Salvador ratified the WTO Trade Facilitation Agreement (TFA) in February  2016 and 
deposited its instrument of acceptance with the WTO  on 4 July 2016.9 On 19  September  2006, 
El Salvador accepted the Protocol amending the Agreement on Trade -Related Aspects of Intellectual 
Property Rights (TRIPS), with a view to making a decision on patents and public health permanent.  
2.20.  El Salvador is a pa rticipant10 in the Information Technology Agreement (ITA), but does not 
participate in the ITA extension agreed at the 2015 Nairobi Ministerial Conference. Nor is it party to 
the other plurilateral agreements: the Agreement on Government Procurement and th e Agreement 
on Trade in Civil Aircraft.  
2.21.  In the WTO, El Salvador is a member of the following groups: the small, vulnerable economies, 
the G -33 and the Joint Proposal group (intellectual property - geographical indications). El Salvador 
also participates in  the four Joint Statement Initiatives11, supported the Buenos Aires Declaration on 
Trade and Women's Economic Empowerment and is co -chair of the Informal Working Group on Trade 
and Gender.12 
2.22.  At the 2022 Ministerial Conference in Geneva, El Salvador affirme d that the trade negotiations, 
full compliance with commitments, transparency exercises, and the efficient functioning of the 
dispute settlement mechanism should take place in unison and in an effective manner. El Salvador 
expressed support for efforts to improve the functioning of the WTO and emphasized the importance 
of concluding the multilateral agenda in areas such as fisheries subsidies and agriculture, by securing 
agreements that take into account the legitimate development aspirations of all Members . It also 
underlined the importance of a robust multilateral system to ensure the proper functioning of 
international markets and reaffirmed the importance of continuing to promote the interests of small 
economies.13 
2.23.  During the review period, El Salvador submitted several notifications under the various 
WTO Agreements (Table A2.1). Nonetheless, the country has a number of outstanding notifications, 
mainly in the areas of agriculture and quantitative restrictions.14 Since its last review, El Salvad or 
has not been involved in any cases as a complainant or respondent under the WTO dispute 
settlement mechanism, although it has participated as a third party in six cases.15 
2.3.2   Regional and preferential agreements  
2.24.  El Salvador is participating in the process of establishing a customs union, the Central 
American Common Market (CACM). This process began in 1960 pursuant to the General Treaty on 
Central American Economic Integration.16 The other founding members of the CACM are Costa Rica, 
Guatemala, Honduras and  Nicaragua; Panama has been a participant since 6  May 2013. The 
 
9 WTO. Viewed at: https://tfadatabase.org/members/el -salvador . 
10 WTO document G/IT/1/Rev.59 of 25 March 2022.  
11 Joint Initiative on Electronic Commerce; Joint Initiative on Investmen t Facilitation for Development; 
Joint Initiative on Micro, Small and Medium -sized Enterprises (MSMEs); and Joint Initiative on Services 
Domestic Regulation.  
12 WTO. Viewed at: https://www.wto.org/english/thewto_e/countries_e/el_salvador_e.htm . 
13 WTO document WT/MIN(22)/ST/37 of 12 June 2022.  
14 WTO. Viewed at: https://notifications.wto.org/en/status -by-member/el -salvador . 
15 WTO. Viewed at: https://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm . 
16 WTO document WT/REG93/R/B/2 of 6 October 2004.  WT/TPR/S/440  • El Salvador  
- 37 - 
  regulatory framework provides for some members to progress more rapidly towards the commitment 
to achieve a Central American economic union.  
2.25.  The Tegucigalpa Protocol of 13  December  1991 signed  by Guatemala, El Salvador, Honduras, 
Nicaragua, Costa Rica and Panama establishes and consolidates the Central American Integration 
System (SICA). Belize joined in 2000 and the Dominican Republic acceded in December  2003 as an 
Associated State. SICA compr ises four subsystems: the Economic Integration Subsystem; the Social 
Integration Subsystem; the Environmental Integration Subsystem; and the Political Integration 
Subsystem. With this new structure, Guatemala, El Salvador, Honduras, Nicaragua and Costa Ric a 
decided to sign the Protocol to the General Treaty on Central American Economic Integration 
(Guatemala Protocol) on 29  October  1993. Through the Protocol, these countries undertake to 
achieve, on a voluntary, gradual, complementary and progressive basis,  the Central American 
Economic Union, the progress of which must respond to the needs of the region's countries.  
2.26.  In 2017, El Salvador began negotiations to join the deep integration process that Honduras 
and Guatemala had launched in 2015. On 16  August  2018, El Salvador deposited with the SICA 
Secretariat the Protocol of Accession to the Enabling Protocol for the process of deep integration 
initiated by Guatemala and Honduras.17 After a hiatus, negotiations resumed in July  2021 and in 
December that year the  three countries agreed on a road map to complete El Salvador's full 
membership. The three trading partners are estimated to account for 50 % of nominal GDP (2021) 
and 70 % of Central America's intra -regional exports.  
2.27.  El Salvador has signed most of its regio nal trade agreements with Central American countries. 
Since its last TPR18 in 2016, El Salvador has implemented trade agreements - jointly negotiated with 
other Central American partners - with the Republic of Korea and the United Kingdom, respectively, 
and a bilateral partial scope agreement with Ecuador (Table 2.1). As such, in addition to the CACM, 
El Salvador has Free Trade Agreements (FTAs) and/or partial scope agreements with Chile, 
Colombia, Cuba, Ecuador, the United States (CAFTA -DR), Mexico, Panama , the United Kingdom, the 
Republic of Korea, the Dominican Republic (CAFTA -DR and Central America -DR), Chinese Taipei19, 
and the European Union. These trade agreements applicable to El Salvador have been notified to 
the WTO.20 
2.28.  The first Additional Protocol  to the partial scope agreement with Cuba was signed on 
25 October  2018 and is now under consideration by the Legislative Assembly's Commission on 
Foreign Affairs, Central American Integration and Salvadorans Abroad.  
Table 2.1 Trade agreements negotiated by El Salvador, 2016 -2221 
 Association Agreement 
between the United 
Kingdom and Central 
Americaa Free Trade Agreement 
between Central Americab 
and the Republic of Korea  Partial Scope 
Agreement 
betwee n El 
Salvador and 
Ecuador  
Date of entry into force  01/01/2021  01/01/2020  16/11/2017  
Scope  Goods and services  Goods and services  Goods  
End of tariff reduction 
period  2027 2039 2021 
 (% of tariff lines)  
Preferential part of the 
tariff 95.5 94.9 3.4 
Tariff-free lines  47.1 47.4 0.0 
Immediate reduction  1.8 4.5 3.3 
Less than 10 years  6.7 11.5 0.1 
10 years  35.4 26.2 0.0 
Over 10 years  4.2 5.3 0.0 
 
17 SICA. Viewed at: https://www.sica.int/documentos/protocolo -de-adhesion -de-la-republica -de-el-
salvador -al-protocolo -habilitante -para-el-proceso -de-integracion -profunda -hacia-el-libre-transito -de-
mercancias -y-de-personas -naturales -entre -las-republicas -de-guatemala -y-honduras_1_114433.html . 
18 WTO document WT/TPR/S/344/Rev.1 of 23 November 2016.  
19 This agreement ceased to apply on 8 November 2022. Executive Decision No. 1429 of 
8 November  2022.  
20 WTO. Viewed at: http://rtais.wto.org/ . 
21 Based on the nomenclature of the Central American Tariff System (SAC) in force on 1 January 2022.  WT/TPR/S/440  • El Salvador  
- 38 - 
   Association Agreement 
between the United 
Kingdom and Central 
Americaa Free Trade Agreement 
between Central Americab 
and the Republic of Korea  Partial Scope 
Agreement 
betwee n El 
Salvador and 
Ecuador  
Lines with preferential 
tariff higher than zero  n.a. n.a. 22.2 
Lines where tariffs 
remain  4.5 5.1 96.6 
Preferential tariff rate 
quotas  0.3 0.0 0.0 
n.a. Not applicable.  
a Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama.  
b Costa Rica, El Salvador, Honduras, Nicaragua and Panama.  
Note In Ecuador's case, the modality was tariff discount and not tariff reduction category.  
Source:  Information provided by MINEC.  
2.29.  According to information from the Salvadoran authorities, in 2021 El Salvador's trade flows 
with economies with which it has existing preferential agreements accounted for 96.3 % of its total 
exports and 70.0 % of its total merchandise imports.  
2.3.3   Other agreements and arrangements  
2.30.  El Salvador participates in regional integration and cooperation processes as part of the 
Association of Caribbean States (ACS). The basi c objectives of the ACS are to create an expanded 
economic area, preserve the environmental integrity of the Caribbean Sea and promote the 
sustainable development of the region. In pursuit of these objectives, the ACS focuses its work on 
areas such as trad e, transport, sustainable tourism and the prevention of natural disasters.22 
2.31.  Under the Generalized System of Preferences, El Salvador was benefiting, as of October  2022, 
from preferential trade arrangements with the following partners (the year of entry in to force of the 
preferences is given in brackets): Australia (1974); Armenia (2016); Canada (1974); 
Russian  Federation (2010); Japan (1971); Kazakhstan (2016); Kyrgyzstan (2016); Norway (1971); 
New Zealand (1972); Switzerland (1972); and Eurasian Economic Union (2016).23 
2.4  Investment regime  
2.32.  The Government of El Salvador considers that attracting foreign direct investment (FDI) is 
key to achieving economic development and diversification, and to fostering the country's 
participation in global value chains. Acc ordingly, El Salvador maintains an essentially open 
investment regime, which grants equal treatment to domestic and foreign investors. Likewise, the 
country offers legal stability and various forms of investment incentives and has taken steps to 
improve th e business environment.  
2.33.  An objective of the new Trade and Investment Policy 2020 -50 is to attract and retain FDI to 
boost the development of technologically -advanced industries and services and ensure synergies 
between FDI and the local economy. The goal i s to reach a FDI stock of no less than 60 % of GDP by 
2050 (in 2021 it stood at 38 %) and to attract primarily "efficient investment" with the potential to 
promote export activity.24 Another goal is to increase the share of exports in GDP to 38 % by 2050. 
To achieve these objectives, annual action plans (2021 and 2022) have been prepared and, among 
other efforts, an investment facilitation committee has been set up to provide a forum for dialogue 
with the private sector on this topic.  
2.34.  MINEC and the Export and Investment Promotion Agency of El Salvador (PROESA) constitute 
the institutional investment framework. MINEC helps define investment policy and is responsible for 
its application and for the implementation of investment agreements signed by El Salvador. Wi thin 
 
22 ACS. Viewed at: http://www.acs -aec.org/index.php?q=about -the-acs. 
23 WTO. Viewed at: http://ptadb.wto.org/default.aspx . 
24 Secretariat for Trade and Investment, Política de Comercio e Inversiones de El Salvador 2020 -50. 
Viewed at: https://www.transparencia.gob.sv/institutions/capres/docu ments/433788/download . WT/TPR/S/440  • El Salvador  
- 39 - 
  MINEC, the Investment Directorate provides support to the business sector to increase its 
productivity and competitiveness, by facilitating employment -generating investment and exports.25 
For its part, PROESA, attached to the Office of the President o f the Republic, is aimed at promoting 
and attracting domestic and foreign private investment, promoting exports, assessing and 
monitoring the business environment, and formulating proposals to improve investment and export 
policies. PROESA provides technic al advice and information to potential investors on laws, 
regulations, procedures and incentives, and promotes investment in the following priority sectors: 
textiles and clothing, offshore business services, digital services (bitcoin, fintech and software 
development), agro -industry, light manufacturing and life sciences.26 
2.35.  The legal framework consists of a number of laws that promote and protect investment and 
provide incentives to investors, both domestic and foreign. The main laws include the Investment 
Law, the Law on Legal Stability for Investments, the Special Law on Public -Private Partnerships 
(PPP), the Law on Industrial and Commercial Free Zones, and the Law on International Services. 
These two most recent laws and amendments thereto are addressed i n Section 3.3.1 of this report. 
There are also laws providing investment incentives in specific sectors, such as renewable energy. 
Some such laws are currently subject to amendment.  
2.36.  The Investment Law, enacted in 1999 and amended in 2013, seeks to encourag e private 
investment in general and foreign investment in particular. The Law provides that foreign investors 
have the same rights and obligations as Salvadoran investors and shall not be subject to unfair or 
discriminatory measures with respect to the est ablishment, administration, use, usufruct, extension, 
sale and liquidation of their investments.27 
2.37.  Foreigners are free to invest in any kind of business in the country, except in the following 
areas, which are subject to limitations under the Constitution and secondary laws28: 
• Only Salvadorans by birth and nationals of other Central American countries may engage 
in small -scale trade, industry and provision of services, especially with regard to coastal 
fishing.  
• Foreigners may not acquire rural real estate i f their countries of origin do not grant equal 
rights to Salvadorans; such restriction does not apply to land destined for industrial 
establishments.  
• The same natural or legal person, whether Salvadoran or foreign, may not own more than 
245 hectares of rur al land.  
• The State is empowered to regulate and supervise public services provided by private 
companies.  
• The subsoil belongs to the State and a concession is required for its exploitation.  
• The operation of wharves, railways, canals and other facilities for  public use is subject to 
government concession.  
• Investments in shares in banks, financial enterprises and foreign currency exchange 
offices are subject to the limitations prescribed in the laws governing such institutions.  
2.38.  Foreign investors are entitled t o transfer abroad net profits, dividends and other funds related 
to their investment without delay and with free currency convertibility through the banking system; 
they also have the right to access local financing. As regards migration, special provision s are made 
for foreign investors to obtain residency in the country if their investment exceeds 4,000 times the 
minimum wage in the trade and services sector, i.e. around USD  1.5 million.29 A new draft Law on 
 
25 MINEC, Marco institucional . Viewed at: https://www.economia.gob.sv/marco -institucional/ . 
26 For more information, see PROESA, InvestElSalvador . Viewed at: https://investelsalvador.com/ . 
27 Article 5 of the Investment Law.  
28 Article 7 of the Investment Law.  
29 In 2022, the monthly minimum wage in the trade and services sector amounted to USD  365. WT/TPR/S/440  • El Salvador  
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  Migration and Alien Affairs was being prepared in November  2022, with a view, inter alia , to 
facilitating the granting of temporary permits for workers employed by foreign investors.  
2.39.  The Investment Law provides protection and legal security for private property. Under the 
Constitution of the Republic, the Law establishes that expropriation may be carried out for 
legally -substantiated reasons of public need or social interest and subject to fair compensation.30 
2.40.  In accordance with the 2013 amendment to the Investment Law, in the event of dispute s 
between foreign investors and the State regarding investments made in El Salvador, the parties may 
apply to the competent courts under the legislation in force and relevant legal procedures.31 Under 
the investment protection agreements and Free Trade Agr eements (FTAs) to which it is party, 
El Salvador accepts that investment disputes between the Salvadoran State and investors of other 
signatory parties be submitted to international arbitration in accordance with the Convention of the 
International Centre for Settlement of Investment Disputes (ICSID).  
2.41.  According to the Investment Law (Article 17), foreign investors, like domestic investors, must 
register their investments with MINEC's National Investment Office (ONI), which is responsible for 
facilitating an d coordinating the government procedures that investors must follow to operate in the 
country. Under no circumstances may the registration of foreign investments be contingent on the 
fulfilment of performance requirements.32 Through the virtual window MiEm presa , domestic and 
foreign investors can carry out the formalities for setting up a business and other operational 
procedures.33 The authorities report that formalization procedures take an average of five working 
days and that they are currently designin g a computer system whereby resolutions certifying the 
registration of an investment can be obtained online; this system is expected to come into operation 
in 2023.  
2.42.  As of November  2022, the authorities were considering a number of amendments to the 
Investm ent Law, consisting mainly of developing a definition of strategic investment projects, 
reducing investment registration times, and establishing new migration benefits for foreign 
investors.  
2.43.  The 2015 Law on Legal Stability for Investments34 is aimed at att racting domestic and foreign 
investment by ensuring legal certainty for investors through contracts with the State. Those who 
may benefit from this Law include domestic or foreign natural or legal persons carrying out new 
investment projects or expanding e xisting investment in El Salvador in the following sectors: 
aeronautics, agro -industry, aquaculture, electronics, energy, strategic infrastructure, logistics, 
health services, offshore business services, tourism, telecommunications, various lines of 
manufa cturing, and science and technology. By mid -2022, three contracts had been signed with 
renewable energy companies.  
2.44.  Under legal stability contracts, investors enjoy: (i) tax stability at the national and municipal 
level (except for indirect taxes), (ii) sta bility with respect to tax exemptions contained in special 
laws, (iii) stability of customs procedures, (iv) stability regarding the free transfer abroad of funds 
from foreign investment and (v) stability of the migration regime applied to investors. In ex change 
for these benefits, investors must comply with the requirements set out in the Law, including a 
commitment to invest at least 4,220 times the minimum wage in the industry sector (about 
USD 1.54 million) in new projects or in expanding existing ones.  The term for which legal stability 
is guaranteed depends on the investment amount and can last up to 20 years (Table 2.2).  
2.45.  In order to enter into a legal stability contract, investors must submit an application to PROESA 
containing, among other things, in formation on the amount of the investment, the number of jobs 
to be created, the technology transfer that will take place, the origin of the resources to be invested, 
the regime under which stability is being sought (tax, customs, migration) and the reason s that 
warrant stability of the investment. The application must also include a commitment to apportion 
3% of the total value of the investment in the contract to the implementation of local development 
 
30 Article 8 of the Investment L aw. 
31 Article 15 of the Investment Law, as amended by Legislative Decree No.  423 of 11 July 2013.  
32 Article 18 of the Investment Law.  
33 For more information, see https://www.miempresa.gob.sv/ . 
34 Legislative Decree No. 905 of 18 December 2014.  WT/TPR/S/440  • El Salvador  
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  works in the municipality in which the investment is to be made.35 If the application is accepted, 
PROESA forwards it to MINEC, which draws up the legal stability contract, which is concluded in the 
form of a public document between the applicant company and MINEC.  
Table 2.2 Term of legal stability contracts  
Investment amount  
(current minimum wages)  Maximum term of 
contract  Applicable conditions  
USD 1.54 to USD  7.7 million  5 years  The investment must be made in full during the first 
two years.  
USD 7.7 to USD 15.4 million  10 years  The investment must be made in full during the first 
five years.  
More than USD  15.4 million  20 years  The investment must be made in full during the first 
ten years.  
Source: Article 14 of the Law on Legal Stability for Investments.  
2.46.  The Special Law on Public -Private Partnerships (PPP)36 establishes the regulatory framework 
for the development of PPP projects for the efficient provision of infrastructure and public and 
general -interest services. The Law was amended in 2018  to broaden its scope.37 The Law currently 
applies to all contracts in which state entities entrust a private investor with the design, construction, 
repair, upgrading, fitting out, operation and maintenance of infrastructure. Contracts may also 
include in frastructure for the provision of public services or the operation or implementation of a 
general -interest activity.38 However, projects in certain sectors fall outside the scope of the Law.39 
The investment amount of PPP projects must exceed 45,000 minimu m monthly salaries (around 
USD 16.4 million) and the duration of contracts cannot exceed 40 years. To conclude a PPP contract, 
the contracting entity organizes a public bidding procedure to select and award a contract to a private 
partner. A Salvadoran pub lic limited company (special purpose company) must then be set up in 
order to implement the contract project.40 The Law also allows private investors to propose 
PPP projects, which will be subject to bidding if they are declared of interest by a public ent ity. 
PROESA is the advisory and governing unit for PPP contracts and is responsible for their approval.41 
In October  2020, the first PPP contract was awarded to extend the cargo terminal at El Salvador's 
international airport.  
2.47.  During the review period, El Salvador adopted several laws aimed at strengthening the 
business regulatory framework, the implementation of which could help improve the transparency 
of the investment environment. For example, the Law on Regulatory Improvement, approved in 
December  201842, aims to ensure the quality of state regulations43 so that their benefits outweigh 
their costs and they are of maximum benefit to society, and to eliminate unnecessary requirements 
in procedures that affect the business climate, competitiveness, foreign  trade and the attraction of 
investment. In accordance with the Law, government entities must publish online a list of the 
regulations they plan to adopt or amend each year, submit them for public consultation and conduct 
a regulatory impact assessment pri or to their adoption or amendment. The application of the Law to 
government entities is being phased in gradually and the process is expected to be completed by 
2024 and include the municipal authorities. As of October  2022, more than 75 government 
institu tions and entities had published lists of regulations that they planned to approve, amend or 
simplify, and a total of 750 procedures had been assessed and simplified.44 
 
35 The amount must be disbursed during the first two years of operation of the investment (Article 13(e) 
of the Law on Legal Stability).  
36 Legislative Decree No. 379 of 23 May 2013.  
37 Legislative Decree No. 859 of 8 January 2018.  
38 General -interest activities aim to boost strategic economic sectors through the promotion of 
technology, science, innovation, and research and development (Article 3 of the Special Law on Public -Private 
Partnerships).  
39 Excluded sectors are health, social security, public security, justice (custody, rehabilitation and prison 
labour for inmates), water and education (including the University of El Salvador).  
40 Article 46 of the Law on Public -Private Par tnerships.  
41 PROESA, Guía del Inversionista 2021 . Viewed at: https://proesa.gob.sv/guia -del-inversionista/ . 
42 Legislative Decree No. 202 of 9 January 2019.  
43 The term "regulations" includes gene ral rules issued under the legal system, including laws, 
regulations, decrees, decisions, general resolutions, administrative provisions, instructions, circulars and 
technical standards.  
44 For more information, see the Regulatory Improvement Agency website at: https://omr.gob.sv/ . WT/TPR/S/440  • El Salvador  
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  2.48.  The Law on Administrative Procedures was adopted in early 201845 and entered into force in 
February  2019. It aims to simplify, modernize and consolidate the administrative procedures of 
public administration entities. This is expected to streamline and make procedures more efficient, 
avoid unnecessary requirements and enhance transparency, thus facilitating business and 
investment procedures, among others.  
2.49.  The Construction Formalities Directorate has also recently been set up as a specialized entity 
with functional and technical autonomy. It is attached to the Office of  the President of the Republic, 
and is responsible for coordinating the work of the various Executive Branch institutions that handle 
formalities relating to investment in construction (such as permits and authorizations), with a view 
to facilitating, simp lifying and streamlining such formalities.  
2.50.  As well as adopting the Electronic Signature Law in 2016, El Salvador enacted the Law on 
electronic commerce46, in force since February  2021, which establishes a legal framework for 
commercial and financial activi ties, both contractual and non -contractual, carried out through 
electronic or digital means. The Law provides for electronic invoicing, lays down provisions to protect 
consumers and suppliers and introduces procedures to mitigate risks arising from the use  of new 
technologies. The Law is expected to support the expansion of online business and financial 
technology (fintech).  
2.51.  El Salvador has 17 bilateral investment promotion and protection agreements in force 
(Table  A2.2). Most were signed over two decades a go, and the country is not currently negotiating 
any new such agreements. Moreover, several of the trade agreements the country has signed 
contain investment chapters, for example the CAFTA -DR (2004), the FTA between Central America 
and Mexico (2011) and, more recently, the FTA between Central America and the Republic of Korea 
(2018). At the multilateral level, El Salvador is a signatory to the ICSID Convention, the Convention 
on the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York Conv ention) and 
the Convention Establishing the Multilateral Investment Guarantee Agency (MIGA Convention).  
2.52.  On the taxation front, El Salvador has concluded only one bilateral agreement to avoid double 
taxation (with Spain).47 El Salvador is also a signatory to the Multilateral Convention on Mutual 
Administrative Assistance in Tax Matters of the Organisation for Economic Co -operation and 
Development (OECD), which entered into force in El Salvador on 1  June 2019.  
2.53.  The most freque nt legal forms of commercial company set up in El Salvador are public limited 
companies with variable capital, limited liability companies and branches of foreign companies. In 
the latter case, in order to be incorporated, companies must register with MINE C's National 
Investment Office (ONI) and subsequently with the Trade Registry. The minimum capital required 
to establish a branch is USD  12,000; for the other two types of companies, it is USD  2,000.  
2.54.  Foreign companies are subject to the same tax regime as domestic companies. Legal persons, 
whether or not domiciled in El Salvador, are subject to income tax (ISR), which is 25 % on taxable 
income of up to USD  150,000 or 30 % on taxable income exceeding that figure.48 Non-resident legal 
persons  are only subject to these rates when they file their tax returns for income earned in the 
country. As a general rule, individuals or companies making payments to non -residents resulting 
from any type of income obtained in El Salvador must make an income t ax withholding of 20 % on 
these. Reduced withholding rates apply in certain cases, such as payments for international 
transportation services and payments made to insurance and reinsurance companies. Profits paid to 
shareholders, whether or not domiciled in  El Salvador, are subject to a definitive income tax 
withholding at a rate of 5 %, which can increase to 25 % if the beneficiary is resident in a tax haven 
or a jurisdiction with a preferential tax regime.49
 
45 Legislative Decree No. 856 of 13 February 2018.  
46 Legislative Decree No. 463 of 6 February 2020.  
47 Agreement of 7 July 2008 b etween the Kingdom of Spain and the Republic of El Salvador regarding 
the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on 
capital.  
48 Article  41 of the Law on Income Tax.  
49 Deloitte, Doing Business El Salvador 2021 . Viewed at: 
https://www2.deloitte.com/sv/es/pages/tax/articles/doing -business -in-el-salvador -2021.html . WT/TPR/S/440  • El Salvador  
- 43 - 
  3  TRADE POLICIES AND PRACTICES BY MEASURE  
3.1  Measures d irectly affecting imports  
3.1.1   Customs procedures and requirements, and customs valuation  
3.1.1.1   Customs procedures and requirements  
3.1.  The main legal instruments governing El Salvador's customs system are the Central American 
Uniform Customs Code (CAUCA IV) and its impl ementing Regulations (RECAUCA IV)1 at regional 
level, with the Organic Law of the Directorate -General of Customs2, the Law streamlining customs 
procedures3 and the Special Law on penalties for customs offences at domestic level.4 While 
modifications ha ve been made to some of these instruments, the customs -related legal framework 
has not undergone any fundamental change since El Salvador's last trade policy review in 2016. At 
the time of writing, the authorities were working on a draft Salvadoran Customs  Code with a view 
to consolidating in a single instrument the various provisions governing customs operations, as well 
as modernizing procedures for clearance of goods in line with international standards. The draft was 
expected to be brought before the Le gislative Assembly in late 2022 or during the first quarter of 
2023. The CAUCA and its implementing Regulations were also being revised as part of the process 
of Central American economic integration. The Directorate -General of Customs (DGA) within the 
Ministry of Finance remains the body responsible for applying customs regulations.  
3.2.  Any natural or legal person wishing to import goods to El Salvador must be registered with the 
DGA. As of June  2022, natural persons have been able to register upon presentatio n of their national 
identity card (DUI)5 or passport in the case of foreigners. Legal persons must present their tax 
identification number (NIT) in order to register.6 
3.3.  El Salvador, along with the other members of the Central American Common Market 
(CACM) ,has adopted the Central American Single Declaration (DUCA), adopted by Resolution 
No. 409-2018 of the Council of Ministers for Central American Economic Integration (COMIECO). 
The DUCA, in force since 7  May 2019, brings together the three main documents n eeded for regional 
trade in goods: the Central American Single Customs Form (FAUCA), the Goods Declaration (DM) 
and the Overland International Customs Transit Declaration (DUT). The DUCA comprises 
three  variants: DUCA -F, used for trade in goods within the Central American region pursuant to the 
Central American Regulations on the Origin of Goods; DUCA -D, used for import/export of goods from 
third countries; DUCA -T, used for movement of goods under the overland international customs 
transit regime. DUCA -F and DUCA -D for export operations are processed by the Import and Export 
Processing Centre (CIEX El Salvador under the Central Reserve Bank). The Secretariat for 
Central  American Economic Integration (SIECA) administers the DUCA -T electronic platform, to 
which the customs authorities of the countries of Central America are connected.7 
3.4.  In addition to the DUCA, documents required for an import operation include the following: 
commercial invoice, transport documents (bill of lading, air waybill or waybill for la nd transport); 
cargo manifest; licences, permits, approvals or other authorizations required depending on the type 
 
1 Both legal instru ments entered into force on 25 August 2008.  
2 Legislative Decree No. 903 of 14 December 2005 (latest amendment October 2012).  
3 Legislative Decree No. 529 of 13 January 1999 (latest amendment June 2018). The purpose of the 
amendment was to expedite customs  procedures: the period for the withdrawal of goods at customs has been 
reduced from 48 to 24 hours through a simplified procedure (without final determination of taxes payable) and 
an upper limit of 24 hours was introduced for non -intrusive inspections.  
4 Legislative Decree No. 551 of 20 September 2001. The most recent amendment (May 2018) made 
changes to the fines for administrative offences and to tax penalties, as well as to the tolerance margins for 
certain omissions or inaccuracies in the declaration.  It also introduced a fast -track procedure for offenders who 
agree voluntarily to sanctions procedures in cases where the fine does not exceed a certain amount, as well as 
an increased threshold amount for fiscal prejudice to be deemed a tax fraud offence.  
5 Following the June 2022 tax reform, the DUI and tax identification number (NIT) have become one 
and the same for natural persons.  
6 The following are exempt from registration: persons or organizations belonging to the diplomatic or 
consular corps; emerg ency supplies; postal packages; travellers' luggage and household items; and small 
family consignments of a non -commercial nature.  
7 SIECA portal. Viewed at: https://www.sieca.int/in dex.php/plataformas -electronicas/ . WT/TPR/S/440  • El Salvador  
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  of product being imported; and a certificate of origin for goods entering under a preferential trade 
agreement.  
3.5.  The goods declaration and sup porting documents are transmitted electronically to the DGA's 
IT systems. As of 24  August  2022, it has been compulsory to submit the advance DUCA -F import 
and export declaration and supporting documents electronically, although only for goods crossing 
through the La Hachadura and Pedro de Alvarado border posts between El Salvador and 
Guatemala8,with the authorities expecting to extend this requirement to goods passing through 
other land border posts between El Salvador and Guatemala in the near future. As to the El Amatillo 
border post between El Salvador and Honduras, implementation of this mechanism was expected by 
the end of 2022 or during the first quarter of 2023.  
3.6.  Since May  2019, the DGA has been using the Automated System for Customs Data A SYCUDA 
World (which superseded ASYCUDA ++), allowing for digitalization of the majority of formalities and 
faster foreign trade operations. The system enables, inter alia , the electronic submission  and 
processing of declarations under definitive import, ex port and customs transit regimes, as well as 
transmission of the cargo manifest and air transport documents, the import declaration for express 
delivery or courier goods and the temporary import declaration for containers and used vehicles.9 
By mid -2022, almost 79 % of foreign trade operations were being processed via ASYCUDA World. 
The DGA runs the Integrated Customs Payment System (SIAP), which allows the electronic payment 
of import duties and other applicable taxes. These payments can also be made via t he P@GOES 
system, which additionally allows for the payment of fees, fines and customs seals, inter alia . 
3.7.  CIEX El Salvador, administered by the Central Reserve Bank, serves as El Salvador's Single 
Window for Foreign Trade. Established in 2011, CIEX is task ed with centralizing, streamlining and 
simplifying procedures for the registration, authorization and issuance of documents required by 
state entities involved in the supervision of foreign trade operations.10 CIEX has systems 
interoperability with the fol lowing institutions: Ministry of Finance (DGA and Directorate -General of 
the Treasury), Ministry of Health, Ministry of Agriculture and Livestock, Ministry of National Defence, 
Ministry of the Environment, Ministry of Economic Affairs, National Directorate  of Medicines, 
International Regional Organization for Plant and Animal Health and seven banks. In February  2021, 
CIEX implemented the Foreign Trade Facilitation System (SFCE), which combined the IT systems for 
import (SIMP) and export (SICEX) management i n a single portal. In the case of imports, this gives 
importers online access to the authorizations and approvals required for importing products such as 
agricultural inputs, food and beverages, and alcohol. During 2022, CIEX was undertaking work to 
automa te further services such as import authorization for chemicals and authorization of plant and 
animal health certificates for import purposes.  
3.8.  Clearance of goods in El Salvador generally involves the engagement of a customs agent, albeit 
with some exception s. Pursuant to RECAUCA -IV (Article 87), the services of a customs agent are 
not necessary in the following cases: customs operations carried out by the State; operations 
covered by DUCA -F; small non -commercial consignments; consignments received by post or  express 
delivery; travellers' luggage; operations by legal persons represented by a special customs broker ; 
relief consignments; samples with no commercial value; and imports with a value not exceeding 
1,000 Central American pesos (USD  1,000). RECAUCA IV (Article 88) also sets out the circumstances 
where the use of a customs agent is optional.11 At the domestic level, the Law streamlining customs 
procedures (Article 9) provides that the use of a customs agent is optional for users if those users  
are legal persons and have granted power of attorney to a special customs broker. Customs agents 
and special customs brokers must be authorized by the DGA in order to operate.  
3.9.  Prior to importing goods, an importer, exporter or producer may make a request to the DGA 
for advance rulings concerning: (i) the valuation criteria or methods applicable to goods; (ii) tariff 
classification; and (iii) determination of origin in order to benefit from a tariff preference. 
 
8 Resolution of the Ministerial Body for the Process of Customs Union between Guatemala, El Salvador 
and Honduras RIM 104 -2022 of July 2022.  
9 The inclusion of duty -free and suspended -duty regimes has yet to take place.  
10 CIEX services include import approvals, customs authorizations and documents for export, certificates 
of origin for certain FTAs, transport documents and electronic payments.  
11 These circumstances are: definitive exports; temporary export for re -import in  the same state; free 
zones; bonded warehousing; temporary export for outward processing; temporary admission for inward 
processing and other regimes explicitly set out in the Regulations.  WT/TPR/S/440  • El Salvador  
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  RECAUCA  IV (Article 310) stipulates that advan ce rulings are binding on the DGA and on 
individuals.12 
3.10.  Goods import declarations undergo risk analysis (i.e. placement into channels). This analysis 
allows the DGA to determine whether the importer may immediately withdraw the good to be 
imported (green c hannel or automatic release), whether the documents must be inspected (yellow 
channel) or whether both physical inspection and inspection of the documents (red channel) are 
required. During the review period, the DGA developed the Integrated Risk -Managemen t System, 
which harnesses artificial intelligence to establish selection criteria and thereby provide high 
data-analysis throughput. In 2021, 94.6 % of import declarations led to automatic release, compared 
to 78.9 % in 2016 (Table 3.1).  
Table 3.1 Import declarations by type of clearance procedure, 2016 -21 
Year  Inspection of 
documents  % of 
declarations  Physical 
inspection  % of 
declarations  Automatic 
release  % of 
declarations  
2016 92,394  14.1 45,350  6.9 515,468  78.9 
2017 59,603  9.2 46,423  7.1 545,025  83.7 
2018 59,148  9.0 36,601  5.6 562,662  85.5 
2019 40,042  6.1 29,641  4.5 584,356  89.3 
2020 9,334  1.7 22,155  4.0 526,084  94.4 
2021 9,645  1.4 27,190  3.9 651,616  94.6 
Source:  Information provided by the authorities.  
3.11.  Pursuant to the customs regulations, the DGA has the authority to carry out post -release 
controls on goods. To that end, importers are required to keep and make available to the DGA all 
documents, books, accounts or any other relevant informat ion for four years after clearance. 
According to data supplied by the authorities, 74 a postiori  controls were carried out in 2020 and 
176 in 2021. The DGA found USD  5,552,808 of unpaid taxes and fines for 2020 and USD  15,350,358 
for 2021. No data was obta ined for previous years.  
3.12.  The mechanism for appealing decisions by the DGA is set forth in the RECAUCA (Articles 623 
to 629) and the Special Law on penalties for customs offences (Articles 47 to 52). Importers or their 
representatives may appeal to the Dire ctor-General of Customs for review of rulings or decisions by 
the DGA within 10 working days following notification of the ruling being contested. The 
Director -General must decide on the appeal within 20 days of receiving the administrative file. 
Appeals a gainst rulings by the Director -General may be made to the Internal Revenue and Customs 
Duty Appeals Court in accordance with the procedures, time -limits and legal provisions governing 
action by the Court. Rulings by the Court exhaust administrative channel s. The authorities have 
indicated that between 2016 and 2021 the Court issued a total of 293 rulings on customs matters.  
3.13.  El Salvador pursued its customs modernization efforts during the review period. In addition 
to the implementation of ASYCUDA World, adv ance declaration and enhancements to the 
risk-management system, measures adopted by the DGA include the following: modernization of 
procedures through digitization and automation of user services; the incorporation of customs 
formalities into a digital wo rkflow platform allowing for traceability; the launch of the Aduana Móvil 
app, offering users a suite of services (electronic tariffs, foreign trade dashboards, operations 
traceability, payments and air waybills); installation of radio -frequency identifica tion technology at 
customs premises; heat map analysis of operational flows to allocate human resources depending 
on fluctuations in demand for services; modernization of the border facilities at El Amatillo and 
Anguiatú (with investment of USD  32.6 millio n); and technological equipment (databases, virtual 
infrastructure and IT equipment for clearance processes).  
3.14.  In addition, 2020 saw the DGA begin implementation of the Trusted Operator programme, 
which replaced the Authorized Economic Operator programme in troduced in 2017. The new 
programme cut the number of assessment criteria for operators wishing to participate and 
broadened the range of benefits available to recognized trusted operators, who are granted priority 
service, fewer checks and virtual customs . As of November  2022, eight firms were participating in 
the programme. In April  2019, pursuant to RECAUCA IV, the customs authorities of Costa Rica, 
 
12 2 The guide to requesting advance rulings can be found in General  Administrative Provision (DACG) 
No. DGA-003-2016 of 1 February 2016.  WT/TPR/S/440  • El Salvador  
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  El Salvador, Guatemala and Panama concluded the Agreement on the mutual recognition of their 
respective Au thorized Economic Operator programmes.  
3.1.1.2   Trade facilitation  
3.15.  On 4 July 2016 El Salvador deposited its instrument of acceptance of the Trade Facilitation 
Agreement (TFA) with the WTO. Prior to that, El Salvador had notified its category A and C 
implementation commitments under the TFA.13 The country also notified its transparency 
commitments.14 At the time of writing, on the basis of its category A, B and C notifications, 
El Salvador had implemented 94 % of its implementation commitments, with three further measures 
awaiting implementation between December  2022 and December  2024.15 The authorities have 
reported that the commitments on authorized economic operators and transit have in practice 
already been  implemented.  
3.16.  The trade facilitation agenda has been accorded particular attention by the current 
Government. The National Trade Facilitation Committee (CNFC), which resumed activities in 2019, 
serves as a forum for dialogue and decision -making with a view  to promoting initiatives to simplify, 
streamline and facilitate foreign trade. Thirteen public institutions and seven productive sectors 
participate in it. The CNFC has approved three annual action plans (2020, 2021 and 2022) that set 
strategic objectives  and specific measures in the following areas: (i) strategic planning; (ii) reduction 
of technical barriers; (iii) simplification of processes; (iv) improvements to transport and logistics 
infrastructure; (v) regulatory reforms; (vi) use of new technology;  and (vii) enhanced 
inter-institutional coordination, capacity and transparency. The 2020 and 2021 plans have been 
implemented to a high degree, with 104 measures undertaken. The 2022 plan is currently in the 
implementation phase and comprises 29 strategic  measures, along with 95 specific measures.16 
3.17.  In addition to those already mentioned, trade facilitation measures implemented by 
El Salvador in recent years include the simplification and streamlining of formalities (for example, 
for obtaining health recor ds, import/export permits for agricultural products, import permits for 
medicines and medical devices, results of sample analysis from the Food and Toxicology Laboratory, 
etc.). New technology includes digitization of processes and modernization of the IT systems used 
by the single window (CIEX), as well as interconnectivity with other institutions, the development of 
the customs risk -management system and the creation of the Environmental Health Information 
System (SISAM). Improvements have also been made to logistics infrastructure, such as capacity 
upgrades at the port of Acajutla and the freight terminal of the international airport (the latter via a 
public -private partnership), the construction of new border ports and road improvements to foster 
foreign  trade. In addition, businesses have received training on foreign trade and progress has been 
made on the preparation of draft legislation on plant and animal health, as well as on the Salvadoran 
Customs Code. At the time of writing, the authorities were i n the process of developing the National 
Trade Facilitation Strategy, whose adoption was expected in 2022.  
3.18.  At the regional level, El Salvador participates in the Central American Strategy for Trade 
Facilitation and Competitiveness (ECFC) with Emphasis on C oordinated Border Management, 
adopted in 2015.17 El Salvador operates six land border posts within this framework, four with 
Guatemala (La Hachadura, Anguiatú, San Cristóbal and Las Chinamas) and two with Honduras 
(El Poy and El Amatillo). Measures are bei ng implemented at these border posts to help cut release 
times and costs, such as the advance declarations used at La Hachadura. During the review period, 
 
13 WTO documents WT/PCTF/N/SLV/1 of 29 July 2014 and G/TFA/N/SLV/1 of 22 October 2018.  
14 WTO document G/TFA/N/SLV/2 of 27 May 2019.  
15 These measures concern provisions on authorized economic operators, the single window and transit. 
WTO TFA Database, viewed at: https://tfadatabase.org/members/el -salvador . 
16 For more information on the Trade Facilitation Action Plans, see: http://infotrade.minec.gob.sv/plan -
de-accion -de-facilitacion -de-comercio/ . For outcomes, see: http://infotrade.minec.gob.sv/presentaciones -
facilitacion -de-comercio/ . 
17 The priority measures set out in the ECFC are as follows: advance declaration of goods (operational 
since June  2019); stre amlining and coordination of immigration controls; electronic plant and animal health 
certificates; logging of transport movements using radio -frequency devices; use of camera systems at border 
crossings. Medium - and long -term measures are as follows: adop tion of international standards; data 
interoperability; integrated risk -management; trusted operators; quarantine control; integration of procedures 
and controls; infrastructure and equipment; border communities and security. Areas of progress can be viewe d 
at: https://www.sieca.int/index.php/integracion -economica/integracion -economic a/estado -actual -del-proceso -
de-integracion/estado -actual -de-la-integracion -economica/ . WT/TPR/S/440  • El Salvador  
- 47 - 
  El Salvador continued to modernize its border posts as part of the process towards a customs union 
with Guatemala and Honduras, receiving international assistance to this end. The customs 
administration of El Salvador has made progress on the implementation of electronic submission  of 
DUCA -F advance declarations with Guatemala (automatic generation of tra nsport documents, 
electronic submission  of supporting documents and notification of payment of charges) and work 
towards the same goal has begun with Honduras.  
3.19.  In 2021, the CACM countries conducted a regional time release study (TRS) at border customs 
along the Pacific -Central American Corridor. The Salvadoran border posts chosen for the study were 
San Cristóbal (a hub for trade with Guatemala), La Hachadura (transit point for trade between 
northern and southern Central America) and El Amatillo (connection between El Salvador and 
southern Central America). These three border posts combined account for 85.9 % of all 
intra-regional trade declarations (DUCA -F) and 83.4 % of all transit declarations (DUCA -T) recorded 
nationwide. The TRS revealed that average custo ms clearance times in El Salvador were the shortest 
of any of the six countries in the region. The results of the TRS for each Salvadoran border post can 
be seen in Table 3.2.  
3.20.  The TRS also identified certain pinch points at Salvadoran border posts such as poor roads at 
border crossings, poor provision of space for physical checks, vehicle congestion on inbound bridges 
and incomplete or absent documentation preventing immediate clearance. The authorities have 
explained that these problems are not necessarily  to be found at all three border posts included in 
the study, although failure by operators to supply the requisite documentation in advance does occur 
at all posts. With this in mind, one of the DGA's priorities has been the implementation of advance 
declarations for goods. At the same time, congestion at border posts can be attributed partly to the 
high freight volume transiting via El Salvador. To alleviate these issues, a national action plan has 
been drawn up involving measures such as physical infrast ructure improvements, greater 
automation of procedures and cross -border coordination. A regional action plan has also been 
formulated in order to resolve problems shared by the countries of the region.18 
3.21.  A report by the OECD found that El Salvador's trade facilitation performance had improved 
between 2017 and 2019 in the areas of information availability, appeals procedures, simplification 
and harmonization of documentation, streamlining of procedures and domestic/cross -border 
cooperation b etween control agencies. The report suggests several areas where improvements could 
be made, such as formalities involving documents and procedures, governance and impartiality, 
greater involvement of the trade community and advance rulings, inter alia .19 Moreover, the UNCTAD 
Sustainability Score for National Trade Facilitation Committees published in 2022 awarded 
El Salvador 73 out of 100, indicating that the prospects for El Salvador's NTFC being sustainable 
over time are good.20 
Table 3.2 Average clearance times at El Salvador's border posts, 2021  
Type of operation  Average time at customsa Average time at borderb 
El Amatillo border post  
Definitive import  7 minutes  4 hours 51 minutes  
Definitive export  4 minutes  6 hours 6 minutes  
Transit El Salvador -Honduras  30 minutes  6 hours 27 minutes  
Transit Honduras -El Salvador  18 minutes  6 hours 45 minutes  
La Hachadura border post  
Definitive import  11 minutes  3 hours 40 minutes  
Definitive export  5 minutes  2 hours 12 minutes  
Transit Guatemala -El Salvador  14 minutes  24 minutes  
Transit El Salvador -Guatemala  23 minutes  33 minutes  
 
18 Estudio de Tiempos de Despacho Regional  (regional time release study). Viewed at: 
http://estadist icas.sieca.int/documentos/detalle/1232 . 
19 OECD, Trade Facilitation Indicators. Country profiles:  El Salvador. Trade facilitation performance.  
Viewed at: https:// www.compareyourcountry.org/trade -facilitation/en/1/default/SLV/default . 
20 UNCTAD. Viewed at: https://unctad.org/topic/transpo rt-and-trade -logistics/trade -facilitation/national -
trade -facilitation -bodies/score . WT/TPR/S/440  • El Salvador  
- 48 - 
  Type of operation  Average time at customsa Average time at borderb 
San Cristóbal border post  
Definitive import  11 minutes  2 hours 18 minutes  
Definitive export  7 minutes  2 hours 45 minutes  
a Time taken by the customs official to process information.  
b Covers the time from arrival of goods at the border to their departure from the border facilities.  
Source:  SIECA, Estudios de Tiempos de Despacho Regional . Viewed at: 
http://www.oie.sieca.int/documentos/detalle/1232 . 
3.1.1.3   Customs valuation  
3.22.  Customs valuation in El Salvador is governed by the WTO Customs Valuation Agreement 
(CVA), supplemented by the provisions of RECAUCA IV (Articles 187 t o 209) and the Law 
streamlining customs procedures. There have been no changes to this legal framework since 2016.  
3.23.  During the review period, El Salvador met all outstanding notification obligations under the 
CVA. It notified the Central American Regulation s on Customs Valuation of Goods, replied to the 
checklist of issues on customs valuation and submitted notifications concerning the treatment of 
interest charges and valuation of carrier media.21 
3.24.  Customs valuation of imported goods uses the first CVA metho d, the transaction value, 
adjusted to include transport costs to the place of import, other c.i.f. charges and the cost of 
insurance. If no insurance policy has been taken out to cover transport of the goods, 1.25 % of the 
f.o.b. value should be applied whe n the goods come from the Central American region and 1.50 % 
when they come from outside the region. When it is not possible to certify the freight value, 10 % of 
the f.o.b value of the goods applies.22 
3.25.  When it is not possible to determine the value of goods  by means of transaction value, the 
use of other valuation methods must follow the hierarchy set out in the CVA. Reversal of the order 
of application of the valuation methods provided for in Articles 5 and 6 of the CVA may only occur 
when the customs autho rity accepts a request to do so from the importer.23 Data from the authorities 
indicates that transaction value is applied to 96.3 % of import declarations.  
3.26.  The customs authority may exclude from the customs value the interest owing under a 
financing agreem ent relating to purchase of the imported goods if the conditions prescribed in 
RECAUCA IV are met.24 The customs value of data carrier media is determined on the basis of the 
cost of the carrier medium (not the data).  
3.27.  In the event of postponement of the determination of customs value, the importer may 
request that the goods be cleared, provided that it posts security sufficient to cover the amount of 
the tariffs and other taxes ultimately payable on the goods.25 
3.28.  El Salvador does not apply minimum values to determine the value of imported goods. In 
order to make it easier to determine value, the DGA keeps a database with information on prices 
and publishes administrative regulations establishing reference values for goods imported in t he 
form of parcels, small consignments and postal packages, used spare parts, fruit and vegetables 
and in informal cross -border trade, which may be used if the importer has no commercial invoice or 
is unable to prove the price actually paid or payable. In addition, the DGA offers an online service 
allowing importers to check the value of various new and used goods (automobiles, ships and 
aircraft) for the purpose of completing their import declaration.26 
 
21 WTO documents G/VAL/N/1/SLV/1 of 7 July 2022; G/VAL/N/2/SLV/1 of 21  September  2021; 
G/VAL/N/3/SLV/1 of 4 November 2021; and G/VAL/N/3/SLV/2 of 12 January 2022.  
22 Article 2 of the Law streamlining customs procedures.  
23 Article 195 of RECAUCA IV.  
24 Article 190 of RECAUCA IV.  
25 Article 202 of RECAUCA IV.  
26 Customs administration of El Salvador. Viewed at: https://sitio.aduana.gob.sv/servicios/consultas -de-
valoracion -de-mercancias -varias -vehiculos -naves -y-aeronaves . WT/TPR/S/440  • El Salvador  
- 49 - 
  3.1.2   Rules of origin  
3.29.  El Salvador has notified the WTO that  it does not apply non -preferential rules of origin.27 
3.30.  El Salvador applies preferential rules of origin within the framework of the General Treaty on 
Central American Economic Integration and under its preferential trade agreements currently in 
force. The rules of origin under these agreements have been notified to the WTO.28 Within the 
context of the General Treaty on Central American Economic Integration, rules of origin are governed 
by the Central American Regulations on the Origin of Goods and their Ann ex, containing specific 
rules of origin.29 
3.31.  The preferential trade agreements to which El Salvador is party contain general provisions on 
the determination of the origin of goods, as well as specific rules of origin. The latter set out the 
criteria that mus t be met by goods that have not been wholly obtained or produced in the territory 
of one of the countries parties to the agreement. Specific rules of origin generally carry a requirement 
for substantial transformation criteria to be met, based primarily on  a change in tariff classification. 
In some cases, they also prescribe regional content requirements, which are applied separately or 
in combination with the change in tariff classification criterion.  
3.32.  El Salvador's trade agreements prescribe the eligibilit y requirements for cumulation of origin 
of different types (bilateral, regional or diagonal). For example, diagonal cumulation of origin is 
permitted for any product from the Plurinational State of Bolivia, Colombia, Ecuador and Peru, in the 
case of the As sociation Agreement between Central America and the European Union. On the other 
hand, this type of cumulation is only allowed for certain textiles (HS Chapter 62) using materials 
originating in the United States under the agreement between Central America  and Mexico, with the 
same provision applying on a reciprocal basis in the CAFTA -DR with respect to materials originating 
in Mexico. In addition to the cumulation of materials originating in one or more signatory countries, 
certain agreements also permit t he cumulation of production processes.  
3.33.  In order to demonstrate that a product is of a certain origin, a certificate of origin must be 
submitted to customs (using the form corresponding to the agreement in question). Under most 
agreements, these certificate s can be issued by the exporter or producer without the need for 
subsequent authorization (self -certification). Other agreements (such as the Association Agreement 
between the European Union and Central America) stipulate the entity responsible for issuanc e or 
certification of origin. In the case of El Salvador, this entity is CIEX.  
3.1.3   Tariffs  
3.34.  As a member of the CACM, El Salvador applies the Central American Import Tariff (ACI), which 
is currently based on the Seventh Edition of the Harmonized Commodity Descri ption and Coding 
System (HS 2022). COMIECO, composed of the ministers for economic affairs of the CACM member 
countries, is the only body with the mandate to make tariff changes.  
3.35.  There are four basic rates in the ACI: 0 % on raw materials and intermediate a nd capital goods 
not produced in the CACM; 5 % on raw materials produced in the CACM; 10 % on intermediate and 
capital goods produced in the CACM; 15 % on finished goods. El Salvador and the other CACM 
member countries may apply different rates if these are a pproved by COMIECO. The authorities 
have indicated that the rates applicable to 93.15 % of ACI tariff lines have been harmonized among 
CACM member countries.  
3.36.  As a minimum, El Salvador gives MFN tariff treatment to both WTO Members and 
non-Members.  
 
27 7 WTO document G/ RO/N/10 of 16 August 1996.  
28 During the review period, the following notifications were received: WTO documents G/RO/N/161 of 
21 July 2017; G/RO/N/208 of 11 January 2021; G/RO/N/222 of 29 April 2021; G/RO/N/225 of 29 April 2021.  
29 The Regulations were amen ded by COMIECO Resolution No. 449 -2021. The Annex, adopted through 
COMIECO Resolution No. 377 -2016, remains in force.  WT/TPR/S/440  • El Salvador  
- 50 - 
  3.1.3.1   Structure  and levels  
3.37.  In 2022, El Salvador's applied tariff comprised 7,534 ten -digit lines, with an increase in lines 
compared to the 2015 figure (6,978) due primarily to the change in nomenclature from HS 2012 to 
HS 2022 (Table 3.3).  
3.38.  All applied rates are ad valor em. El Salvador does not apply specific or mixed tariffs, nor does 
it have seasonal or variable tariffs. There are 11 tariff rates ranging from 0 % to 164 %. As at 
1 January  2022, 47.8 % of tariff lines were duty -free (0 % tariff), while 20.7 % had a rate of 15 % and 
15.3% of them a rate of 10 % (Chart 3.1). This distribution is unchanged from 2015. The arithmetic 
average applied MFN tariff rate remained at 6.3 % in 2022, as it was in 2015.  
3.39.  In March  2022, the Legislative Assembly of El Salvador passed the Special T emporary Law to 
tackle commodity price inflation (Legislative Decree No.  309 of 13  March  2022), thereby reducing 
tariffs to zero on 49 tariff lines comprising basic foodstuffs (milk, rice, beans, maize, sugar, etc.) 
and certain agricultural inputs (fertili zers and insecticides). These reductions will apply until 
31 March  2023. They bring the percentage of tariff lines with zero tariffs to 48.5 %, with an arithmetic 
average tariff of 6.2 % (Table 3.3). In addition, in late June  2022, the Legislative Assembly a pproved 
a reduction to zero of tariffs on beef -based foodstuffs via an amendment to the Special Temporary 
Law to tackle commodity price inflation.30 
3.40.  Analysis of tariffs in force as at 1  January  2022 shows that the arithmetic average MFN rate 
applied to agr icultural products according to the WTO definition remained practically stable when 
compared with 2015, at 12.4 %, although it fell to 11.5 % as of March  2022 as a result of the 
above -mentioned temporary tariff reduction. The average rate applied to non -agricultural products 
was 5.3 %, virtually identical to the rate recorded in 2015 (5.2 %). The highest tariff rate (164 %) 
continues to be applied to meat, edible offal and prepared or preserved poultry meat.31 Furthermore, 
40% tariffs apply to 79 tariff lines, c overing products such as pork, sausages, milk, rice, sugar, rum 
and ethyl alcohol. Some of these products were the subject of temporary tariff reductions pursuant 
to Legislative Decree No.  309 of 13  March  2022 and its amendment.  
3.41.  An examination of the tarif f by stage of production shows that the average applied rate for 
finished goods (7.6 %) is almost double that for semi -finished goods (3.9 %), while the average 
applied rate for raw materials (7.1 %) is also higher than that for semi -finished goods (Table 3.4 ). 
Table 3.3 MFN tariff structure, 2015 and 2022  
 
2015  
(HS 2012)  2022  
(HS 2022)  
as at 1.1.2022  2022a 
(HS 2022)  
13.3.2022 - 31.
3.2023  
Total number of lines  6,978  7,534  7,534  
Ad valorem  rates (> 0%)  3,641  3,933  3,884  
Duty-free 3,337  3,601  3,650  
Non-ad valorem tariffs  
(% of all tariff lines)  0.0 0.0 0.0 
Non-ad valorem  tariffs with no ad valorem  
equivalents (% of all tariff lines)  0.0 0.0 0.0 
Tariff rate quotas  
(% of all tariff lines)  0.3 0.0 0.0 
Duty-free tariff lines  
(% of all tariff lines)  47.8 47.8 48.5 
Average for lines with a tariff greater than zero 
(%) 12.0 12.1 12.0 
Arithmetic average (%)  6.3 6.3 6.2 
Agricultural products (WTO definition) (%)  12.5 12.4 11.5 
Non-agricultural products (including petroleum, 
WTO definition) (%)  5.2 5.3 5.3 
National tariff peaks  
(% of all tariff lines)b 2.7 3.0 2.8 
 
30 Legislative Decree No. 433 of 28 June 2022.  
31 These products correspond to the following tariff headings: 0207.13.93, 0207.13.93, 0207.1 3.94, 
0207.14.93, 0207.14.94, 1602.32.10 and 1602.32.90.  WT/TPR/S/440  • El Salvador  
- 51 - 
   
2015  
(HS 2012)  2022  
(HS 2022)  
as at 1.1.2022  2022a 
(HS 2022)  
13.3.2022 - 31.
3.2023  
International tariff peaks  
(% of all tariff lines)c 2.7 3.0 2.8 
Overall standard deviation of applied rates  8.8 8.8 8.7 
Bound tariff lines  
(% of tariff lines)  100.0  100.0  100.0  
a Legislative Decree No.  309 - Special Temporary Law to tackle commodity price inflation, in force 
from 13  March  2022 to 31  March  2023.  
b National tariff peaks are defined as rates exceeding th ree times the overall arithmetic average 
applied rate.  
c International tariff peaks are defined as rates exceeding 15 %. 
Source:  WTO Secretariat calculations, based on data provided by the authorities.  
Chart 3.1 Frequency distribution of tariff rates, as at 1  January  2022  
Number of linesa               % 
 
a The total number of lines is 7,534.  
Source:  WTO Secretariat calculations, based on data provided by the authorities.  
Table 3.4 Brief analysis of the MFN tariff, as at 1  January  2022  
Description of products  MFN Bound  
(range)a 
(%) Number 
of lines  Average 
(%) Range 
(%) Coefficient 
of variation 
(CV) 
Total  7,534  6.3 0 - 164 1.4 0 – 164.4  
HS 01 -24 1,328  13.0 0 - 164 1.1 20 - 164.4  
HS 25 -97 6,206  4.9 0 - 30 1.3 0 - 80 
By WTO category  
Agricultural products  1,069  12.4 0 - 164 1.3 20 - 164.4  
Animals and animal products  158 25.5 0 - 164 1.2 20 - 164.4  
Dairy produce  35 26.6 0 - 40 0.5 20 - 45.1 
Fruit, vegetables and garden produce  307 11.3 0 - 30 0.6 20 - 50 
Coffee and tea  29 13.3 0 - 15 0.3 40 - 70 
Cereals and preparations  134 9.3 0 - 40 1.1 20 - 78 
Oilseeds, fats and oils and their products  104 5.7 0 - 15 1.0 20 - 88 
Sugar and confectionary  21 26.2 0 - 40 0.6 40 - 70 
Beverages, spirits and tobacco  80 15.8 0 - 40 0.7 20 - 74 
Cotton  5 0.0 0 - 0 n.a. 40 - 40 
Other agricultural products n.e.s.  196 4.1 0 - 15 1.3 20 - 40 
Non-agricultural products (including petroleum)  6,465  5.3 0 - 40 1.2 0 - 80 
Non-agricultural products (excluding 
petroleum)  6,437  5.3 0 - 40 1.2 0 - 80 
Fish and fish products  349 12.0 0 - 40 0.5 25 - 70 
(47.8%)
(1.0%)(12.2%)(15.3%)(20.7%)
(0.5%) (0.4%) (0.8%)(0.2%)(1.0%)(0.1%)
0102030405060708090100
05001,0001,5002,0002,5003,0003,5004,000
0% 1% 5% 10% 15% 20% 25% 30% 35% 40% 164%Number of linesa
Percentage
Cumulative percentage
Number of lines (% of total)WT/TPR/S/440  • El Salvador  
- 52 - 
  Description of products  MFN Bound  
(range)a 
(%) Number 
of lines  Average 
(%) Range 
(%) Coefficient 
of variation 
(CV) 
Minerals and metals  1,126  3.6 0 - 15 1.5 20 - 50 
Chemicals and photographic products  1,397  2.2 0 - 15 1.9 0 - 50 
Wood, wood pulp, paper and furniture  520 6.4 0 - 15 0.9 20 - 70 
Textiles  715 8.1 0 - 15 0.6 20 - 70 
Clothing  228 14.8 0 - 15 0.1 40 - 40 
Leather, rubber, footwear and travel articles  212 7.6 0 - 15 0.7 20 - 80 
Non-electrical machinery  653 1.5 0 - 15 2.7 0 - 50 
Electrical machinery  374 2.8 0 - 15 1.9 0 - 50 
Transport equipment  309 7.8 0 - 30 1.3 20 - 50 
Non-agricultural products n.e.s.  554 7.8 0 - 30 1.0 0 - 40 
Petroleum  28 3.75 0 - 15 1.2 40 - 40 
By ISIC sectorb 
Agriculture and fishing  552 8.2 0 - 40 0.9 20 - 78 
Mining  111 1.6 0 - 15 1.9 20 - 40 
Manufacturing  6,870  6.2 0 - 164 1.4 0 - 164.4  
By HS section  
01 Live animals and animal products  511 15.2 0 - 164 1.1 20 - 164.4  
02 Vegetable products  442 9.0 0 - 40 0.9 20 - 78 
03 Fats and oils  63 7.9 0 - 15 0.8 20 - 88 
04 Prepared foodstuffs, etc.  312 16.1 0 - 164 1.0 20 - 164.4  
05 Mineral products  186 2.5 0 - 15 1.5 20 - 40 
06 Products of the chemical or allied industries  1,234  1.9 0 - 15 2.2 0 - 50 
07 Plastics and rubber  351 4.3 0 - 15 1.1 20 - 40 
08 Raw hides and skins  108 8.3 0 - 15 0.7 40 - 70 
09 Wood and articles of wood  192 7.7 0 - 15 0.7 20 - 70 
10 Pulp of wood, paper, etc  295 5.1 0 - 15 1.1 20 - 70 
11 Textiles and textile articles  923 9.5 0 - 15 0.5 20 - 70 
12 Footwear and headgear  64 12.8 0 - 15 0.3 30 - 80 
13 Articles of stone  194 6.2 0 - 15 1.1 20 - 50 
14 Precious stones, etc.  56 7.1 0 - 15 0.8 20 - 40 
15 Base metals and articles thereof  718 3.1 0 - 15 1.6 20 - 50 
16 Machines and appliances  1,075  2.1 0 - 15 2.3 0 - 50 
17 Transport equipment  322 7.6 0 - 30 1.3 20 - 50 
18 Precision instruments  236 3.9 0 - 15 1.5 0 - 40 
19 Arms and ammunition  21 30.0 30 - 30 0.0 40 - 40 
20 Miscellaneous manufactured articles  206 10.9 0 - 15 0.5 20 - 40 
21 Works of art, etc.  25 7.4 5 - 10 0.3 40 - 40 
By stage of processing  
First stage of processing  975 7.1 0 - 40 1.1 20 - 78 
Semi-processed products  2,502  3.9 0 - 40 1.4 0 - 70 
Fully processed products  4,057  7.6 0 - 164 1.3 0 - 164.4  
n.a. Not applicable . 
a The bindings are shown according to the HS 2012 classification and the applied rates according to 
HS 2022; there may, therefore, be differences between the number of lines included in this analysis.  
b ISIC (Rev.2), excluding electricity (one line).  
Source:  WTO Secretariat calculations, based on data provided by the authorities.  
3.1.3.2   Tariff bindings  
3.42.  El Salvador has bound its entire tariff schedule in the WTO.32 Bindings consist of  32 tariff rates 
ranging from 0 to 164.4 %. Almost 70 % of tariff lines were bound at 40 %, with 7 % of lines bound 
at 30 % and 12 % of them bound at 20 %. In most cases, the applied rates are considerably lower 
than the bound rates. The WTO Secretariat has ident ified two tariff lines whose applied rate exceeds 
the respective bound rate. These correspond to HS headings 8544.42.21.00 (wire and cables of 
copper or aluminium) and HS 9017.10.00.00 (drafting tables and machines).33 The authorities have 
indicated that this is due to a problem involving tariff classification of products included in the 
Information Technology Agreement (ITA) I and that they are looking at options for resolving this 
discrepancy.  
 
32 Tariff bindings appear in Schedule LXXXVII of El Salvador, annexed to the GATT 1994. The certified 
Consolidated Tariff Schedule based on HS 2012 may be found in document WT/LET/1452 -03. 
33 For this calculation, the Secretariat only took into account those tariff lines contained in El Salvador 's 
Consolidated Tariff Schedule that are strictly comparable with HS 2022.  WT/TPR/S/440  • El Salvador  
- 53 - 
  3.1.3.3   Preferential tariffs  
3.43.  Under the CACM, El Salvador gives preferential treatment to the member countries of the 
group. In 2022, almost all imports (over 99 %) from Costa Rica, Guatemala, Honduras and Nicaragua 
enjoyed duty -free access to the Salvadoran market. Exceptions apply for un roasted coffee and cane 
sugar from any of these countries, roasted coffee and ethyl alcohol from Costa Rica, as well as ethyl 
alcohol, distilled alcoholic beverages and petroleum products from Honduras.34 El Salvador applies 
MFN rates to these products. In  the case of Panama, 85.1 % of tariff lines are currently duty -free. 
This is due partly to the fact that the country is still in the transition phase towards full inclusion in 
the CACM.35 
3.44.  In addition, El Salvador grants preferential tariff treatment to impo rts originating in countries 
or customs territories with which it has concluded a free trade agreement (FTA) or partial scope 
agreement, pursuant to the terms of the relevant agreement. In 2022, El Salvador had trade 
agreements in force with: Chile, Colomb ia, Cuba, Ecuador, Mexico, the United Kingdom, the Republic 
of Korea, the Dominican Republic, Chinese Taipei36, the European Union and the 
CAFTA -DR (Dominican Republic - Central America - United States Free Trade Agreement) 
(Table  3.5). 
Table 3.5 Analysis of preferential tariffs, as at 1  January  2022  
 
Total  WTO categories  
Agricultural products  Non-agricultural products 
(including petroleum)  
Average 
tariff (%)  Duty -free 
tariff lines  Average 
(%) Duty -free tariff 
lines (%)  Average (%)  Duty -free 
tariff lines 
(%) 
MFN 6.3 47.8 12.4 27.0 5.3 51.2 
CAFTA -DR 0.1 99.5 0.4 96.4 0.0 100.0  
Chile 1.0 95.6 4.5 82.1 0.4 97.8 
Colombia  2.9 74.6 7.0 65.6 2.2 76.1 
Cuba 5.7 51.4 11.4 32.6 4.7 54.5 
Ecuador  5.9 50.5 11.9 29.6 4.9 54.0 
Mexico  0.7 96.9 4.4 83.3 0.1 99.1 
Panama  2.2 85.1 5.3 80.3 1.6 85.8 
United Kingdom  1.1 91.7 6.8 69.6 0.1 95.3 
Korea , Rep. of 4.2 52.5 8.9 38.0 3.5 54.9 
Dominican Rep . 0.3 98.6 2.2 91.8 0.0 99.7 
Chinese Taipei  3.1 74.8 6.3 72.7 2.6 75.2 
European Union  1.1 91.7 6.8 69.6 0.1 95.3 
Source:  Calculations by the WTO Secretariat, based on data provided by the authorities.  
3.45.  Analysis of the tariffs applied by El Salvador under the trade agreements it has concluded 
(with the exception of the CACM) shows that in January  2022 the simple average tariff ranged from 
0.1% (CAFTA -DR) to 5.9 % (Ecuador). The proportion of lines in the tariff universe enjoying zero 
rates under each of the agreements ranged from 50.5 % (Ecuador) to 98.6 % (Dominican Republic). 
It can also be seen that the average tariff for agricultural products (WTO definition) was much higher 
than for non -agricultural products. The former ranged from 0.4 % (CAFTA -DR) to 11.9 % (Ecuador) 
while the latter ranged from 0.0 % (CAFTA-DR and Dominican Republic) to 4.9 % (Ecuador). The 
results for Ecuador can be explained by the fact that there is a partial scope agreement in place with 
that country, which only provides for tariff rebates (rather than tariff elimination) and is also 
relatively new.  
3.1.3.4   Tariff quotas  
3.46.  Under its WTO commitments, El Salvador established tariff quotas for imports of the following 
products: meat, milk, cheese, yellow maize, fats and oils, sugar, tobacco and tobacco products. 
During the review period, El Salvador  only opened an annual quota of 785 metric tonnes for 
Cheddar  cheese (HS 0406.90.20.00), with a 0 % in-quota rate and 40 % out-of-quota rate. The quota 
 
34 Annex A of the General Treaty on Central American Economic Integration (TGIEC) conta ined in 
Resolution No. 06 -2010 of 3 September 2010 of the Executive Committee for Economic Integration.  
35 Protocol Incorporating the Republic of Panama into the Economic Integration Subsystem of the 
Central American Integration System, dated 29 June 2012 ( Annexes 4.2 and 4.3).  
36 The agreement with Chinese Taipei ceased to apply on 8 November 2022 pursuant to Executive 
Resolution No.  1429 (Economy) of 8 November 2022.  WT/TPR/S/440  • El Salvador  
- 54 - 
  fill rate fluctuated during the review period (between 12 % and 40 %) and was 40 % in 2021.37 These 
quotas ar e assigned via a system of public procurement import licences on El Salvador's commodity 
and service exchange, pursuant to the Regulations on the opening and administration of quotas. 
El Salvador has notified these regulations to the WTO and replied to the  questionnaire on import 
licensing procedures under which tariff quotas are allocated.38 There has been no change in the 
procedure since the last review.  
3.47.  In addition, El Salvador maintains tariff quotas for a number of agricultural products 
(dairy  produce,  meat, maize and rice) under certain trade agreements that it has concluded 
(Table  A3.1). The procedure for applying these quotas is dictated by the conditions negotiated under 
the different agreements.  
3.1.4   Other charges affecting imports  
3.48.  El Salvador applies i ndirect taxes to domestic and imported products, including property 
transfer and services tax (also known as value added tax (VAT)), specific and ad valorem  taxes on 
the consumption of certain products and the special tax on fuel.  
3.49.  The property transfer and services tax is a value added tax levied on both the import and 
domestic sale of goods, as well as the provision of services, on Salvadoran territory. A rate of 13 % 
applies.39 In the case of imports, the tax base is the customs value plus tari ffs and other applicable 
taxes, while for domestic goods it is the selling price plus the corresponding taxes.  
3.50.  Certain import operations are VAT -exempt, including those carried out by diplomatic 
representations and international organizations of which El S alvador is a member, goods imported 
as travellers' luggage, donations to non -profit organizations and pursuant to agreements concluded 
by El Salvador, as well as imports of buses and rental vehicles for public passenger transport.40 A 
VAT exemption also ap plies to imports of machinery to be included in an enterprise's fixed assets 
and used directly for the production of taxable goods and services.41 In 2019, a VAT exemption was 
introduced for imports by public health institutions of anti -retroviral medicine s to treat HIV/AIDS.42 
Services such as the following are VAT -exempt: public health; education (provided by institutions 
authorized by the Ministry of Education); public land transport of passengers; drinking water supply 
and sanitation provided by public institutions and local authorities.43 
3.51.  In order to mitigate the impact of the sharp rise in international hydrocarbon prices on the 
Salvadoran economy, the Government reduced the rates of VAT applicable to fuel between 23  March 
and 4 April 2022.44 The VAT reduction remained in force until 31  December  2022. Other sales taxes 
on fuel were also suspended in March  202245, with this suspension subsequently extended.  
3.52.  El Salvador taxes the consumption of certain products, both domestic and imported, through 
specific and/or ad valorem  taxes. Products subject to such taxes include juices, aerated beverages, 
energy drinks, alcohol and alcoholic beverages, tobacco products and their substitutes, explosives, 
arms and ammunition. Most of these pro ducts are subject to an ad valorem  tax on the retail price. 
Some of them (energy drinks, alcoholic beverages and tobacco products) are also subject to a 
specific tax. During the review period, the number of products subject to specific taxes was reduced, 
while the ad valorem  tax on these products remained at the same level or increased (Table 3.6).  
 
37 WTO document G/AG/N/SLV/82 of 7 March 2022.  
38 WTO documents G/LIC/N/SLV/1 of 3 February 2 004; G/LIC/N/2/SLV/1 of 27 April 2016; and 
G/LIC/N/3/SLV/4 of 27 August 2020.  
39 Law on the tax on the transfer of property and the supply of services, Legislative Decree No. 296 of  
31 July 1992 and amendments thereto.  
40 Article 45 of the Law on the tax on the transfer of property and the supply of services.  
41 Ministry of Finance. Viewed at: https://www.mh.gob.sv/servicios/exencion -del-iva-por-importacion -
de-maquinaria/ . 
42 Legislative Decree No. 395 of 15 August 2019.  
43 Article 46 of the Law on the tax on the transfer of property and the supply of services and Legislative 
Decree No.  418 of 12 September 2019.  
44 Legislative Decree No. 321 of 13 March 2022 and exte nsions thereof.  
45 Legislative Decrees Nos. 307 and 308 of 13 March 2022.  WT/TPR/S/440  • El Salvador  
- 55 - 
  Table 3.6 Taxes on specific products, 2022  
HS code  Description  Amount of the tax  
Fruit and vegetable juices, unfermented and not containing added spirit  
2009.19.90  Orange juice, not frozen  5% 
2009.21.00  Grapefruit or pomelo juice or nectar - of a Brix 
value not exceeding 20  5% 
2009.29.90  Other grapefruit or pomelo juices  5% 
2009.31.00  Juice or nectar of any other single citrus fruit - of 
a Brix value not exceeding 20  5% 
2009.39.00  Juice of any other single citrus fruit. Other - of a 
Brix value greater than 20  5% 
2009.41.00  Pineapple juice or nectar - of a Brix value not 
exceeding 20  5% 
2009.49.00  Other pineapple juices  5% 
2009.50.00  Tomato juice or nectar  5% 
2009.61.00  Grape juice or nectar - of a Brix value not 
exceeding 30  5% 
2009.69  Other grape juices, nectars or must  5% 
2009.71.00  Apple juice or nectar - of a Brix value not 
exceeding 20  5% 
2009.79.90  Apple juice - other, of a Brix value greater than 
20, in containers smaller than 5 kg  5% 
2009.8  Juice of any other single fruit, nut or vegetable  5% 
2009.90.00  Mixtures of juices or nectars  5% 
Miscellaneous edible preparations - Extracts, essences and concentrates  
2101.12.00  Preparations with a basis of extracts, essences or 
concentrates or with a basis of coffee  5% 
2101.20  Other extracts, essences and concentrates  5% 
Aerated beverages  
2202.10.00  Waters, including mineral waters and aerated 
waters  10% 
2202.91.00  Non-alcoholic beer  10% 
2202.99.90  Other beverages  10% 
2202.99.90.20  Energizing or stimulating drinks  USD 0.2 per litre + 10%  
Alcoholic beverages and drinkable ethyl alcohol  
2203.00.00  Beer made from malt  USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2204.10.00  Sparkling wine  USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2204.21.00  Other wine, in containers holding 2 l or less  USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2204.22.00  Other wine, in containers holding more than 2 l 
but not more than 10 l  USD 0.16 on each 1% of alcohol 
strength by volume per litre + 8%  
2204.29.00  Other wine  USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2204.30.00  Other grape must  USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2205 Vermouth and other wine of fresh grapes 
flavou red with plants, in containers holding 2 l or 
less USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2206.00.00  Other fermented beverages (cider, perry, mead, 
saké)  USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2207.10  Ethyl alcohol  USD 0.1 on each 1% of alcohol 
strength by volume per litre  
2208.40.90  Rum and other spirits obtained by distilling  USD 0.0325 on each 1% of alcohol 
strength by volume per litre + 8%  
2208.50.00  Gin and Geneva  USD 0.16 on each 1% of alcohol 
strength by volume per litre + 8%  
2208.60.10  Vodka of an alcoholic strength by volume of 
greater than 60% vol.  USD 0.09 on each 1% of alcohol 
strength by volume per litre + 8%  
2208.70.00  Liqueurs  USD 0.16 on each 1% of alcohol 
strength by volume per litre + 8%  
2208.90.10  Undenatured ethyl alcohol  USD 0.1 on each 1% of alcohol 
strength by volume per litre  
2208.90.90  Other spirits, including tequila and mezcal  USD 0.09 on each 1% of alcohol   
strength by volume per litre  
Tobacco and manufactured tobacco substitutes   
2402.10.00  Cigars, cheroots and cigarillos, containing 
tobacco  USD 0.0225 per unit + 39%  WT/TPR/S/440  • El Salvador  
- 56 - 
  HS code  Description  Amount of the tax  
2402.10.00  Cigars  USD 0.0225 per unit + 100%  
2402.20.00  Cigarettes containing tobacco  USD 0.0225 per unit + 39%  
2402.90.00  Other (cigars, cigarillos and cigarettes of tobacco 
substitutes)  USD 0.0225 per unit + 39%  
2403.11.00  Water pipe tobacco  USD 0.0225 per gram + 39%  
2403.19.10  Cut tobacco for rolling cigarettes  USD 0.0225 per gram + 39%  
2403.19.90  Other smoking tobacco  USD 0.0225 per unit + 39%  
2403.91.00  "Homogenized" or "reconstituted" tobacco  USD 0.0225 per unit + 39%  
2404 Products containing tobacco, reconstituted 
tobacco or tobacco substitutes  USD 0.0225 per unit + 39%  
Propellant powders and explosives; pyrotechnic articles  
3601 Propellant powders  30% 
3603 Safety fuses; detonating fuses; percussion or 
detonating caps; igniters; electric detonators  30% 
3604 Fireworks  30% 
Arms and ammunition; parts and accessories thereof  
9013.10.90  Telescopic sights for fitting to arms; periscopes; 
telescopes designed to form parts of machines  30% 
9302 Revolvers and pistols, other than those of 
heading 93.03 or 93.04  30% 
9303 Other firearms which operate by the firing of an 
explosive charge  30% 
9305 Parts and accessories of weapons, excluding 
military arms  30% 
9306 Cartridges and other ammunition  30% 
Source:  WTO Secretariat, on the basis of information provided by the authorities.  
3.53.  The special tax on fuel (IEC) applies to the direct import and distribution of gasoil, diesel, 
petrol and mixtures thereof with other fuels. It is an ad valorem  tax taking as its base the 
international reference price for fuel, published fortnightly by the  Ministry of Economic Affairs. The 
applicable rate depends on the international reference price level, as shown in Table 3.7. Given the 
significant increase in international hydrocarbon prices during 2022, the IEC rate remained at 0.0 % 
at the time of writi ng. 
Table 3.7 Tax rates under the special tax on fuel  
International reference price of a barrel of oil  Rate or percentage  
Up to USD  50 1.00%  
USD 50 to 70  0.50%  
More than USD  70 0.00%  
Source:  Law on the special tax on fuel, Decree No.  225 of 12  December  2009.  
3.1.5   Import prohibitions, restrictions and licensing  
3.54.  El Salvador bans the import of some products and reserves the import of others to the State 
alone, pursuant to Legislative Decree No.  647 of 20  Decembe r 1990 (Table 3.8). Furthermore, for 
reasons of road safety, it is forbidden to import used vehicles (passenger or freight) over a certain 
number of years old, depending on the type of vehicle.46 In April  2021, this ban was extended to 
cover used electric vehicles over three years old.47 El Salvador also prohibits the import of certain 
products under international conventions, for example, environmentally harmful substances and 
residues (Basel Convention), ozone -depleting substances (Montreal Protocol) and certain plant and 
animal species  (Convention on International Trade in Endangered Species of Wild Fauna and Flora 
(CITES)).  
 
46 Law on road transport, transit and road safety, Legislative Decree No. 477 of 1995 and amendments 
thereto.  
47 Incentive Law for the import and use of electric and hybrid means of tra nsportation, Legislative 
Decree No.  738 of 30 April 2021.  WT/TPR/S/440  • El Salvador  
- 57 - 
  Table 3.8 Prohibited imports and imports reserved for the State, 2022  
Articles prohibited  
Abortifacients  
Discs of m etal or their alloys used to replace coins  
Figures and statues; pamphlets, almanacs, reviews, lithographed or engraved articles, newspapers, lithographs, 
cards or other articles of an obscene nature  
Books, pamphlets, signs, slogans, emblems, posters and other articles of a subversive nature or doctrines contrary 
to the State's political, social and economic order  
Coin-making machines and tools  
Slot machines  
Smooth -worn silver coins of a fineness of less than 0.900  
Counterfeit coins and banknotes  
Opium containing less than 9% of morphine, opium cinders, opium ash, and appliances for smoking opium  
Unstamped cigarette paper, white or coloured, in folds, rolls, reels, booklets or small tubes  
Films contrary to ethics and morals  
Roulette games, gaming tables and any other equipment or artefacts for prohibited games  
Articles which may only be imported by the State  
Military aircraft  
Raw sugar cane spirit  
Warships of any draught, including submarines and landing craft  
Military rifles  
Gas masks for military uses  
Nickel coins in legal circulation  
Ammunition and implements of war  
Potassium nitrate (nitre salt, saltpetre, kalium nitricum)  
Stamped cigarette paper, white or coloured, in folds, rolls, reels, booklets or small tubes  
El Salvador army regulation pistols  
Pistols and revolvers of any type, of 41 or higher calibre  
Silencers for firearms of all kinds  
Revenue or municipal stamps, postage stamps and other revenue stationery  
Source:  Legislative Dec ree No.  647 of 20  December  1990.  
3.55.  The import of a number of products is restricted for reasons of public health, public safety, 
environmental protection and plant or animal health. Permits, authorizations, certificates and/or 
approval must be obtained from the appropriate regulatory institutions for their import. In certain 
cases, restricted goods must comply with the requirements of more than one regulatory institution. 
The list of goods subject to some form of restriction has not changed since the last rev iew except 
for a new category covering air conditioning and refrigeration equipment and motors, added on 
energy efficiency grounds (Table 3.9). In early December  2022, the authorities indicated that they 
had provided the WTO with their replies to the quest ionnaire on import licensing and expected the 
document to be circulated to Members in the near future.  
Table 3.9 Goods subject to import permits, authorizations or approval, 2022  
Description  Reason  Regulatory 
institution  Legal basis  
Alcohol  Public health  Ministry of 
Health 
(MINSAL)  Law regulating the production and sale of alcohol and 
alcoholic beverages  
Prepared 
foodstuffs, raw 
materials and 
additives for food 
and beverages, 
chemicals and 
compounds, 
pharmaceuticals, 
fertilizers and 
preparations for 
pharmaceutical 
use and cosmetics  Public health  MINSAL, 
National 
Directorate 
of 
Medicines, 
Ministry of 
Agriculture 
and 
Livestock 
(MAG)  
 Health Code; Law on medicines; Regulations on 
proprietary dr ugs WT/TPR/S/440  • El Salvador  
- 58 - 
  Description  Reason  Regulatory 
institution  Legal basis  
Arms, 
ammunition, 
explosive and 
pyrotechnical 
articles  Public safety  Ministry of 
National 
Defence  Law on the control and regulation of firearms, 
ammunition, explosives and similar articles; Special 
Regulations on the control and regulation of explosiv e-type 
articles  
Narcotics, 
psychotropic 
drugs, aggregated 
products, 
precursors, 
chemicals and 
veterinary and 
anaesthetic 
products  Public health  National 
Directorate 
of Medicines 
and MAG  Law regulating activities concerning drugs; Regulations on 
narcotics, psychotropic drugs, precursors, chemical and 
aggregated substances and products;  
Law on medicines  
Source and 
equipment 
generating 
ionizing radiation  Public health  MINSAL  Special Regulations on radiological protection and safety  
Hydrocarbons  Protection of 
the 
environment  Ministry of 
Economic 
Affairs  Law regulating the storage, transport and distribution of 
petroleum products  
Plants and animals 
and their products  Sanitary and 
phytosanitary 
protection  MAG Law on plant and animal health  
Chemical and 
chemical -biological 
products for 
agricultural, 
livestock or 
veterinary use  Sanitary and 
phytosanitary 
protection  MAG Law on plant and animal health; Law on the control of 
pesticides, fertilizers and products for agricultural use and 
the Regula tions implementing the Law  
Ozone -depleting 
substances  Protection of 
the 
environment  Ministry of 
the 
Environment 
and Natural 
Resources  Law on the environment; Special Regulations on the 
control of ozone -depleting substances; Montreal Protocol  
Hazardous 
substances  Public health 
and 
protection of 
the 
environment  Ministry of 
the 
Environment 
and Natural 
Resources  Law on the environment; Special Regulations on 
hazardous substances, residues and waste  
Wildlife  Protection of 
the 
environment  Ministry of 
the 
Environment 
and Natural 
Resources  Law on wildlife conservation  
Air conditioning, 
refrigeration 
equipment and 
motors  Energy 
efficiency  National 
Energy 
Council  Technical regulations on energy efficiency  
Source:  WTO Secretariat on the basis of information provided by the DGA.  
3.1.6   Anti-dumping, countervailing and safeguard measures  
3.56.  El Salvador's regulatory framework for anti -dumping , countervailing and safeguard measures 
includes the respective WTO Agreements, the Central American Regulations on Unfair Business 
Practices48 and the Central American Regulations on Safeguard Measures. The latter two instruments 
have been notified49 and examined by the relevant WTO Committees.  
 
48 Article 4 of the Central American Regulations provides that all substantive aspects relating to unfair 
business practices are to be resolved in accordance with the WTO Agreements.  
49 WTO documents G/SG/N/1/SLV/3 of 10 March 2008; G/ADP/N/1/SLV/3 and G/SCM/N/1/SLV/3, both 
of 8 April 2008.  WT/TPR/S/440  • El Salvador  
- 59 - 
  3.57.  El Salvador has also enacted the Special Law on tra de defence50, which came into force and 
was notified to the WTO in 2016.51 It specifies the requirements, time -limits and procedures for 
conducting dumping, subsidy and safeguard investigations, as well as empowering the competent 
authority to conduct such  investigations and enforce trade defence measures. The Law also sets out 
the information requirements and conditions to be met by domestic industries when submitting 
requests for investigations.  
3.58.  It is the responsibility of the Ministry of the Economy's Di rectorate for the Administration of 
Trade Agreements (DATCO) to conduct investigations and propose the application of the 
corresponding trade defence measures as appropriate. Pursuant to the Special Law on trade defence 
(Article 29), a trade defence invest igation may be initiated at the request of a domestic industry or 
ex officio . Investigations are generally initiated by means of a request lodged by, or on behalf of, a 
domestic industry that considers itself to have been affected.  
3.59.  Executive Decree No.  35 of 14 September  2017 issued the Implementing Regulations for the 
Special Law on trade defence. Here, the provisions of the Law (primarily in relation to the 
methodology for calculating subsidies) are expanded upon in order to ensure proper implementation. 
The authorities have indicated that a notification of these Regulations to the WTO is currently in 
preparation. In April  2022, the Ministry of Economic Affairs published a decision concerning 
procedures for the review of anti -dumping duties.52 
3.60.  El Salvador does not frequently make use of trade defence measures and has never initiated 
an investigation in relation to countervailing measures. During the review period, El Salvador 
initiated two anti -dumping investigations, which were notified to the WTO.53 In Oc tober  2016, 
El Salvador opened an investigation into latex -based architectural paints from the United States. 
The investigation was concluded in April  2018 with a decision to impose final anti -dumping duty 
(376% on imports with an f.o.b. value of less than  USD 5.12 per gallon).54 A review of this duty was 
launched in 2022 (one year prior to its expiry). In November  2017, El Salvador initiated an 
anti-dumping investigation concerning liquid ultra -high-temperature (UHT) processed milk in 
long-life packaging f rom Costa Rica . The investigation was concluded in 2019 when it was found that 
there was no evidence of serious injury caused by dumped imports. No anti -dumping duties were 
therefore imposed.55 
3.61.  Anti-dumping and countervailing duties are imposed for a period of five years. The Special 
Law on trade defence (Article 67) provides for a review of an anti -dumping or countervailing duty at 
the request of the domestic industry that lodged the original investigation request. A duly 
substantiated request must be  submitted one year prior to the expiry of the application period for 
the duty. The Special Law on trade defence does not contain provisions on a procedure for initiating 
anti-circumvention investigations.  
3.2  Measures directly affecting exports  
3.2.1   Customs procedures and requirements  
3.62.  To facilitate their export procedures, any natural or legal person can register as an exporter 
with the Import and Export Processing Centre  (CIEX) managed by the Central Reserve Bank. 
Registration is free of charge and instantan eous, provided that the requirements published on the 
CIEX website have been met.56 Alternatively, exporters can opt to engage the services of a customs 
broker to register their operations in the computer system of the Directorate -General of 
Customs  (DGA).  
 
50 Decree No. 212 of 10 December 2015  
51 WTO documents G/ADP/N/1/SLV/3/Suppl.1, G/SCM/N/1/SLV/3/Suppl.1 and 
G/SG/N/1/SLV/3/Suppl.1, all of 3 November 2016.  
52 MINEC De cision No. 592 of 28 April 2022.  
53 WTO documents G/ADP/N/322/SLV of 28 January 2019 and G/ADP/N/328/SLV of 21  October  2019.  
54 Final Resolution CASO -DACTO -2-ADP-2016. Viewed at: http://infotrade.minec.gob.sv/wp -
content/uploads/Resoluci%C3%B3n -Definitiva -CASO -DATCO -2-ADP-2016.pdf . 
55 Final Resolution CASO -DATCO -3-ADP-2017. Viewed at: http://infotrade.minec.gob.sv/wp -
content/uploads/Resoluci%C3%B3n -Definitiva -CASO -DATCO -3-ADP-2017.pdf . 
56 The requirements can be viewed at: https://www.ciexelsalvador.gob.sv/ciexelsalvador/inscripcion -
importador -exportador -o-transportista -de-carga -internacional/ . WT/TPR/S/440  • El Salvador  
- 60 - 
  3.63.  If the exporter opts to register its operations directly, the process is carried out online through 
the Integrated Foreign Trade System  (SICEX). The SICEX is an electronic platform that allows 
exporters to conduct their export operations in full, intercon necting them with the CIEX, the DGA 
and other state institutions that deal with export procedures. Through this platform, the CIEX issues 
the DUCA -F (for exports destined for CACM  countries that comply with the Central American 
Regulations on the Origin of  Goods), DUCA -D (for exports destined for third countries) and the Goods 
Declaration (for businesses operating in free zones, inward processing warehouses or companies 
covered by the Law on International Services57). Exporters can also use this channel to obtain 
sanitary, phytosanitary and origin certificates according to the nature of the product or the 
requirements of the destination country.  
3.64.  Once the CIEX has validated the export operation, the corresponding information is sent 
electronically to the DGA.  For exports to Guatemala, Honduras, Nicaragua, Costa Rica and Panama, 
the DUCA -F is sent directly to the customs authority in those countries for authorization. To conclude 
the export operation, the following documents must be submitted to the DGA: the DU CA (either F 
or D) or the Goods Declaration, the invoice, the cargo manifest, the documents of carriage and the 
corresponding licences, permits or certificates.  
3.65.  The DGA applies a selective process based on risk -management techniques to determine 
those expo rt shipments whose release will be automatic (green channel) or those which will need to 
undergo a document -based inspection (yellow channel) or document -based and physical inspections 
(red channel). According to DGA figures, over the period from 2016 to 2 021, an average of 1.3 % of 
final export declarations passed through the yellow channel and 1.7 % through the red channel.  
3.2.2   Export taxes and duties  
3.66.  Merchandise exports are exempt from the payment of taxes and other levies. The tax on the 
transfer of property and the supply of services  (VAT) is applied to exports at a rate of 0 %. 
3.2.3   Export prohibitions, restrictions, and licensing  
3.67.  The export of some products is prohibited or restricted, generally for environmental, health, 
public safety and quality control reasons  or to comply with commitments made by El  Salvador under 
international agreements (such as CITES).  
3.68.  El Salvador controls the export of some products through authorizations, permits, certificates 
or registrations that fall under the responsibility of various  public and private institutions. Some of 
these procedures can be carried out through the CIEX. Products subject to export control include 
cane sugar, agricultural chemicals and veterinary medicines, coffee, machinery, arms and 
explosives, and cultural ass ets (Table  3.10). The export of ferrous and non -ferrous waste and scrap 
is restricted, except in the case of exporters registered with the DGA that export waste derived from 
their own production processes and that have DGA authorization. The purpose of the  measure is to 
end the export of illegally obtained waste.58 Under sectoral laws, export authorizations for some 
products, such as cane sugar, pesticides and fertilizers, and natural gas, are granted provided that 
domestic supply is guaranteed. No restrict ions were applied on these products during the period 
under review.  
3.69.  During the review period, El  Salvador temporarily restricted the export of red beans, one of 
the products in the country's basic basket. The measure was in effect from 26  March to 
31 Decem ber 2020 and aimed to ensure adequate supplies to meet domestic demand during the 
COVID -19 pandemic.59 El Salvador had previously restricted red bean exports from 15  May 2014 to 
31 December  2015 to prevent price increases and to guarantee the product's ava ilability.  
 
57 See Section  3.2.4.  
58 Legislative Decree No.  794 of 17  December  2020.  
59 Executive Decision No.  512 of March  2020, MINEC, MAG and DGA. Measure notified to the WTO in 
document G/MA/QR/N/SLV/1 of 27  September  2021.  WT/TPR/S/440  • El Salvador  
- 61 - 
  Table 3.10 Exports subject to control, 2022  
Product  Competent authority  Authorization required  
Shark fins  Ministry of Agriculture 
and Livestock  (MAG)  Finning ban certification issued by the 
Directorate -General of Fisheries and Aquaculture 
Development  
Cane sugar  Salvadoran Sugar 
Agro-Industry 
Council  (CONSAA)  Export quota authorization ruling issued by 
CONSAA  
Agricultural chemicals, biological 
products, medication and food 
preparations for veterinary use  MAG  Certificate for the export of medication for 
veterinary use  
Flora, marine species and wild 
fauna  MAG Export permits for CITES -regulated products  
Coffee (including roasted or 
ground coffee)  Salvadoran Coffee 
Council  (CSC)  CSC permit  
Portable cylinders for liquefied 
petroleum gas  Ministry of Economic 
Affairs  Export authorization from the Directorate of 
Hydrocarbons and Mining, Hydrocarbons 
Division  
Machinery used by free zone 
businesses and inward 
processing warehouses  Ministry of Labour and 
Social Well-being  Ruling by the Directorate -General of Labour 
Inspection  
Ferrous and non -ferrous waste 
and scrap  Ministry of Finance  Registration of exporter with the 
Directorate -General of Customs  
Arms, ammunition, explosives 
and like articles  Ministry of National 
Defence  Special export permit from the Logistics 
Directorate  
Works of art, antiques and 
cultural assets  Secretariat for Culture of 
El Salvador  Certified export authorization from the National 
Cultural Heritage Directorate  
Source:  Information provided by the authorities.  
3.2.4   Export support and promotion  
3.2.4.1   VAT deduction and refund  
3.70.  Exporters have the right to seek deduction of the VAT paid on inputs and services required 
for the production of exported g oods from the tax owing as a result of domestic transactions to 
which VAT applies. Where exporters have a tax credit that they cannot fully deduct from the tax 
owing during the corresponding tax period, they can request a refund of the remaining balance fr om 
the Directorate -General of Internal Revenue.60 As of 2022, this procedure can be carried out online. 
The tax refund can be used to pay VAT on merchandise imports or other direct taxes or tax 
obligations authorized by the Tax Administration.  
3.2.4.2   Free zones a nd inward processing warehouses  
3.71.  The Law on Industrial and Commercial Free Zones (LZFIC) provides the legal framework for 
the operation of free zones and inward processing warehouses  (DPAs).61 The purpose of the Law is 
to establish a macroeconomic environme nt attractive to investors that will contribute to the creation 
of more and better jobs, the transfer of technology, and the country's economic and social 
development. By way of Legislative Decree No.  318 of 21  February  2013, El  Salvador introduced 
substan tial amendments to the LZFIC in order to bring it into line with the country's international 
commitments and to give the regulatory framework the stability needed to attract investment. The 
main changes include the elimination of any reference to export an d local content requirements, the 
introduction of investment and employment requirements, and a scheme offering time -bound and 
differentiated incentives according to where businesses are located.62 The Ministry of Economic 
Affairs is responsible for issuing authorizations for the establishment, administration and operation 
of free zones, whereas the Ministry of Finance is in charge of overseeing and monitoring the 
applicable customs and tax regime.  
 
60 Law on the Tax on the Transfer of Property and the Supply of Services (Articles  76 and  77). 
61 Legislative Decree No.  405 of 3  September  1998. Viewed at:  
http://ww w.oas.org/juridico/spanish/mesicic3_slv_zonas.pdf . 
62 El Salvador has notified the WTO of the approval of Decree No.  318 of 2013. WTO document  
G/SCM/N/253/SLV -G/SCM/N/260/SLV of 8  July 2013.  WT/TPR/S/440  • El Salvador  
- 62 - 
  3.72.  Pursuant to the LZFIC, Salvadoran or foreign businesses may become established in a free 
zone when engaged in any of the following activities: the production, assembly or in -bond assembly 
(maquila), manufacturing, processing, transformation or marketing of  industrial goods (listed in 
Chapter  3 and Chapters  25 et  seq. of the Central American Tariff System); the fishing, processing 
and marketing of marine species; the cultivation, processing and marketing of species of flora grown 
in greenhouses and laborator ies; the breeding and marketing of amphibians and reptiles in captivity 
with a permit from the competent authority; and ethanol dehydration. Also included are services 
needed for or related to performing such activities, which can only be provided to 
LZFIC  beneficiaries.63 
3.73.  Companies engaged in production, assembly, manufacturing, processing or marketing for any 
of the activities listed in Chapter  3 of the LZFIC, which, for technical reasons, cannot be located in 
a free zone, may apply to be authorized as DP As if they meet the requirements laid down in that 
law. 
3.74.  Activities not eligible under the LZFIC are the production, assembly or maquila, 
manufacturing, processing, transformation or marketing of the following products: natural gas, 
petroleum and its by -products; cement and clinker; scrap or waste of steel, iron and other ferrous 
and non -ferrous metals; metallic and non -metallic mineral products; explosives and radioactive 
materials; goods causing pollution, harm to health or damage to the environment; sugar  and its 
substitutes and by -products; alcohol of any origin; and bags or sacks of natural, synthetic or artificial 
textile fibres. Activities pertaining to the supplying of prepared or non -prepared food to employees 
or businesses benefiting from free zones  and other free or suspensive regimes, or to the importation 
of machinery and equipment for leasing purposes, are also excluded from the benefits of the Law.64 
3.75.  The requirements for companies seeking to develop a free zone (developers) are to own land 
the size of at least five blocks, 30 % of which must be green space, and to obtain the corresponding 
building permits.  
3.76.  Companies or legal entities wishing to become users of free zones must meet at least one of 
the following requirements: (i)  make an initial inv estment in fixed assets valued at or above 
USD 500,000 within the first two years of operation; or (ii)  operate at a capacity of 50  or more 
permanent jobs (or five in the case of a marketing company), as of the first year of operation. In 
the case of a DPA , the initial investment must be equal to or greater than USD  800,000, or the 
company must operate at a capacity of at least 75  permanent jobs (or 15 if it is a marketing 
company), as of the first year of operation.65 DPAs are also required to be located i n an industrial 
zone and meet the minimum area, office and building requirements.  
3.77.  The free zone and DPA fiscal incentive scheme is the same as that reported in the previous 
review. Users of free zones and DPAs are exempt from income tax  (ISR), municipal ta xes, tax on 
the transfer of real estate and ISR on dividends. The time limits for these exemptions vary according 
to whether the user is a free zone or DPA user and also depend on the location of the business, that 
is, whether it is within or outside the m etropolitan area. They are also exempt from import tariffs on 
equipment and inputs needed for the authorized activity while the beneficiary business is in operation 
(Table  3.11).  
3.78.  Since the 2013  amendment , sales to the domestic market are treated as follows : if a seller 
sells goods produced abroad to the domestic market, it must pay import duty and other taxes and 
prove that the goods have not undergone transformation and have been under customs control at 
all times. In the case of goods produced in a free z one or a DPA, the seller must pay import duty 
and other taxes on the customs value, excluding the value of the domestic components, provided 
that the value of these components can be proven.  
 
63 Article  3 of the LZFIC.  
64 Article  6 of the LZFIC.  
65 Articles  17-A and 19 -A of the LZFIC.  WT/TPR/S/440  • El Salvador  
- 63 - 
  Table 3.11 Fiscal incentives in free zones and DPAs  
Fiscal incentive  Free zones  
Metropolitan area  Outside the metropolitan area  
Income tax (ISR)  Exemption for the first 15 years  Exemption for the first 20 years  
60% for the next 10 years  60% for the next 15 years  
40% for the subsequent 10 years  
Municipal taxes  Exemption for the first 15 years  Exemption for the first 20 years  
90% for the next 10 years  90% for the next 15 years  
75% for as long as the authorized activity continues  
Tax on the transfer 
of real estate  Exemption for the purchase of real estate to be used for the authorized activity  
Dividends  Exemption from ISR for the first 12  financial years  
Import tariffs  Exemption from import tariffs on machinery, equipment, raw materials, catalysers, 
lubricants, reagents and fuel, inter alia , needed for the  
authorized activity  
Fiscal incentive  Inward processing warehouses (DPAs)  
Metropolitan area  Outside the metropolitan area  
Income tax (ISR)  Exemption for the first 10 years  Exemption for the first 15 years  
60% for the next 5 years  60% for the next 10 years  
40% for the subsequent 10 years  
Municipal taxes  Exemption for the first 10 years  Exemption for the first 15 years  
90% for the next 5 years  90% for the next 10 years  
75% for as long as the authorized activity continues  
Tax on the transfer 
of real estate  Exemption for the purchase of real estate to be used for the authorized activity  
Dividends  Exemption from ISR for the first 12  financial years  
Import tariffs  Exemption from import tariffs on machinery, equipment, raw materials, catalysers, 
lubricants, reagents and fuel, inter alia , needed for the authorized activity  
Source:  WTO Secretariat on the basis of Articles  17 and  19 of the Law on Industrial and Commercial Free 
Zones (Legislative Decree No.  405 of 23  September  1998) and amendments thereto.  
3.79.  During the period under review, various amendments to the LZFIC were approved.66 The main 
changes include the following: the entry and exit of samples to an d from free zones was regulated; 
the customs regime for the introduction and temporary admission of goods was regulated; the 
minimum area required for the establishment of new free zones was reduced; the expansion of 
existing free zones in non -adjoining ar eas was allowed; a procedure for the expansion of DPAs was 
introduced; and a minimum area for activities involving species and amphibians in captivity was 
established. In addition, Legislative Decree No.  791 of 10  December  2020 clarified that the sale of 
goods and the provision of services by domestic suppliers to LZFIC beneficiaries will be subject to 
0% VAT, as long as such goods and services are necessary for the authorized activity, including the 
acquisition of materials for the construction, improvemen t or modification of buildings owned by the 
beneficiaries or the acquisition of services for the same purpose.  
3.80.  In December  2021, the government began to consider further proposed amendments to the 
LZFIC. The amendments seek to reduce bureaucratic hurdles a nd waiting times for the creation of 
new free zones. Consideration is also being given to the possibility of constructing "vertical free 
zones" on different levels of the same building. Moreover, there are plans to expand eligible sectors 
and activities as  well as benefits for developers and free zone and DPA users67 and to relax 
investment and employment requirements. As of November  2022, discussions were still ongoing.  
3.81.  El Salvador's notifications to the WTO Committee on Subsidies and Countervailing Measur es 
do not provide information on the quantity of subsidies granted under the free zone regime or on 
the volume of merchandise exports by regime beneficiaries (in the case of the last 
two notifications).68 
 
66 Legislative Decree No.  876 of 3  January  2018; Legislative Decree No.  332 of 16  May 2019, Legislative 
Decree No.  398 of 15  August  2019 and Legislative Decree No.  791 of 10  December  2020.  
67 Legislative Assembly, Comisión de Economí a avanza con estudio de reformas a la Ley de Zonas 
Francas . Viewed at: https://www.asamblea.gob.sv/index.php/node/11859 . 
68 WTO documents G/SCM/N/299/SLV of 26  July 2016; G/SCM/N/315/SLV of 13  March  2018; 
G/SCM/N/343/SLV of 12  November  2019; and G/SCM/N/372/SLV of 14  September  2021.  WT/TPR/S/440  • El Salvador  
- 64 - 
  3.82.  In 2022, there were 17  free zones in operation and one project to create a new free zone. 
There were also projects to expand nine existing free zones. The number of businesses covered by 
the LZFIC (free zones and DPAs) dropped from 229 in 2015 to 205 in 2021. During this period, the 
level of employment gen erated by these businesses remained at around 80,000  permanent positions 
(with a slight decrease in 2020 due to the pandemic), representing 3 % of the country's total 
workforce. Women accounted for 50 % of all employees in free zone companies and DPAs. Betwe en 
2015 and 2021, exports from free zones amounted to around USD  1.1 billion annually. They fell in 
2020, but then recovered to USD  1.252  billion in 2021, accounting for almost 19 % of the total value 
of Salvadoran merchandise exports that year. Imports by free zone businesses, meanwhile, 
averaged USD  572 million during the period from 2015 to 2021, which represented around 5 % of 
total merchandise imports (Table  3.12).  
Table 3.12 Main free zone and DPA regime in dicators, 2015 -21 
 
2015  2016  2017  2018  2019  2020  2021  
Number of businesses  229 222 218 208 208 202 205 
Number of employees  85,972  84,964  84,722  87,141  80,929  79,402  84,078  
As a percentage of the labour 
force (%)  3% 3% 3% 3% 3% 3% 3% 
Imports  
USD million  490.3  434.5  607.4  638.1  646.6  480.3  705.9  
As a percentage of total 
merchandise imports  4.8 4.4 5.7 5.6 5.6 4.7 4.7 
Exports  
USD million  1,080.2  1,103.8  1,098.7  1,178.5  1,167.5  889.0  1,251.8  
As a percentage of total 
merchandise exports  19.6 20.4 19.1 20.0 19.7 17.7 18.9 
Source:  WTO Secretariat based on data from the Central Reserve Bank of El Salvador, viewed at 
http://www.bcr.gob.sv/bcrsite/?cat=1012&lang=es ; and information provided by the authorities 
(number of businesses and employees).  
3.83.  The economic activities in which free zone enterprises and DPAs are concentrated are: textiles 
and clothing; trade; plastics;  paper and paperboard; chemicals; medical equipment; miscellaneous 
manufactured articles; greenhouse cultivation; and marine fisheries and the processing of marine 
fishery products.  
3.2.4.3   Law on International Services  
3.84.  The Law on International Services  (LSI), pas sed in 2007, provides tariff and tax incentives to 
businesses that provide services to foreign clients.69 To receive incentives, businesses must be 
established in "service parks", which are defined areas considered to be outside the national customs 
territory, where businesses engaged in eligible activities operate under the responsibility of an 
authorized administrator. Businesses engaged in eligible activities, but that for physical or technical 
reasons cannot operate within a service park, may be authori zed to operate as a "service centre" 
and enjoy the same benefits. In addition, businesses engaged in activities that require particular 
physical -spatial characteristics may operate within defined areas in seaports and airports.70 The 
Ministry of Economic A ffairs is responsible for applying the LSI and issuing authorizations to operate. 
Effective monitoring and surveillance of the customs and tax regime covering service parks and 
centres fall to the Ministry of Finance.  
3.85.  Businesses covered by the LSI are exem pt from: (a)  duties and other import taxes on 
furnishings, machinery and other goods needed to provide the services benefiting from incentives; 
(b) the ISR; and (c)  municipal taxes on assets.71 Businesses operating in service parks are also fully 
exempt fr om the tax on the transfer of real estate. The benefits are granted for as long as the 
businesses are in operation and provided that they meet the requirements laid down in the LSI.  
 
69 Legislative Decree No.  431 of 11  October  2007.  
70 PROESA, Investor 's Guide  2020. Viewed at: https://investelsalvador.com/wp -
content/uploads/2020/07/GUIA -I_2020_INGLES.pdf . 
71 Articles 21 and 25 of the LSI.  WT/TPR/S/440  • El Salvador  
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  3.86.  The scope of the LSI was broadened by way of an amendment in 2013 to inclu de more 
activities, while relaxing the requirements businesses must meet. Table  3.13 shows the activities 
that are eligible under the amended LSI and whether they may operate in service parks or centres 
or at ports and airports. The amendment also set out the services that may be sold to the domestic 
market, provided that they are intended for persons or businesses registered as taxpayers and that 
VAT, the ISR and municipal taxes are paid. These services include international distribution, 
international log istics operations, international call centres, international financial services, and 
information technology and research and development services.  
Table 3.13 Law on International Services: eligible activities  
Eligible activities  Percentage of 
services allowed on 
the domestic market  Location  
International distribution  50% Parks  
International logistics operations  50% Parks  
International call or  contact centres  40% Parks or service centres  
Information technology  30% Parks or service centres  
Repair of technological equipment  0% Parks  
Research and development  30% Parks  
Business processes (outsourcing)  0% Parks or service centres  
International financial services  40% Parks  
Medical and hospital services  0% Parks or service centres  
Care of the elderly and convalescents  0% Parks or service centres  
Telemedicine  0% Parks or service centres  
Cinematography  0% Parks or service centres  
Specialized aircraft services  0% Ports or airports, or within a 10  km radius  
Repair and maintenance of  
seagoing vessels  0% Ports or airports  
Repair and maintenance of containers  0% Ports or airports, or within a 10  km radius  
Repair and maintenance of aircraft  0% Ports or airports  
Source:  Prepared by the WTO Secretariat on the basis of the LSI, Legislative Decree No.  431 of 
25 October  2007, as amended by Legislative Decree No.  396 of 16  September  2019.  
3.87.  The requirements businesses must meet to be covered by the LSI depend on the serv ice they 
provide and their location, either in a park or a service centre. Normally, there are minimum 
requirements in terms of investment (between USD  150,000 and USD  2,000,000), employment 
(10 to 20  permanent jobs), length of contrct (six months) and inf rastructure (environmental and 
safety conditions). It is also mandatory to submit a business plan.72 Developers must have a 
minimum of five blocks of land, 30 % of which must be green space, and the corresponding building 
permits.  
3.88.  The LSI was amended in 201 9 and 2020. As part of the 2019  amendments, specialized aircraft 
services were recognized as activities encouraged by the law and a clarification was provided that, 
for these services, food, non -alcoholic beverage and other product imports are exempt from duties 
and other taxes, an exemption that does not apply to other types of activities. The amendment also 
allowed some activities to be carried out in service centres and introduced investment and 
employment requirements for information technology, cinemat ography and specialized aircraft 
services. The 2020  amendment established transitional provisions related to the COVID -19 
pandemic to enable businesses to carry out their activities outside their facilities, for social distancing 
purposes, until 31  Decembe r 2022.  
3.89.  In November  2022, the authorities were working on proposed amendments to the LSI with a 
view to, inter alia, extending the benefits to all businesses covered by the Law, relaxing investment 
and employment requirements, and allowing a business to pr ovide two or more services. According 
to the authorities, this process has been suspended.  
3.90.  Based on the information provided by the authorities, 80  businesses operated under the 
LSI regime in 2021 (compared to 56 in 2016), generating 37,896  permanent jobs,  36% of which 
were held by women. There was also a new service park project. The services in which businesses 
covered by the LSI are concentrated are contact centres, business process outsourcing  (BPO), 
 
72 The requirements to become established in a serv ice park are set out in Articles  22 and 23 of the LSI, 
and to become established in service centres, in Articles  24 and 24 -A of the LSI.  WT/TPR/S/440  • El Salvador  
- 66 - 
  logistics, information technologies and specialized a ircraft services. No data are available on the 
exports of businesses covered by the LSI.  
3.2.4.4   Export promotion  
3.91.  The Export and Investment Promotion Agency of El  Salvador  (PROESA), an institution 
governed by public law and attached to the Office of the President of the Republic, remains the 
leading export promotion agency. Legislative Decree No.  663 of 9  April 2014 defines its 
responsibilities, organization and functioning. PROESA's objectives are to promote exports of goods 
and services produced in the country, a ttract domestic and foreign investment, assess and monitor 
the business climate, and formulate proposals for improving investment and export policies.  
3.92.  The PROESA Export Directorate, through the Export Development Manager's Office and the 
Trade Promotion Ma nager's Office, provides exporters with support in three areas:  
• export advisory services: mentoring and specialized advice, export plan creation, 
identification of strategic opportunities, strengthening of export capacities, export capacity 
analysis, and e xport procedures;  
• strategic information: information on trade opportunities and trends, foreign trade reports, 
reports on specific products or services, and credit reporting from potential buyers; and  
• trade promotion: reverse trade missions, trade promotio n events in markets, virtual 
business roundtables, attraction of trade opportunities, and tailor -made agendas for 
foreign buyers.  
3.93.  During the period under review, PROESA operated a number of support programmes for 
exporters, including Exportar Paso a Paso  and Exportar Más . Exportar Paso a Paso  assists Salvadoran 
businesses that wish to start exporting, mainly by giving them information on markets, training, 
technical assistance and help in promoting products and services with potential in the chosen 
markets.  To join the programme, a business must meet the following requirements: be formally 
registered; if it produces goods, have been operating for at least three years and have annual sales 
amounting to a minimum of USD  100,000, and if it supplies services, ha ve been operating for at 
least one year and have annual sales amounting to a minimum of USD  75,000; and have export 
potential according to the analysis carried out by PROESA.73 Businesses that successfully complete 
the programme can join the Club Empresarial Exportar Paso a Paso , which provides tools to 
strengthen the exportable supply and facilitate the internalization of businesses, such as advice on 
product photography, consu ltancy to improve corporate image and web design.74 
3.94.  The Exportar Más  programme helps businesses to increase and diversify their exports to 
preselected markets by providing information on markets, business support from a PROESA 
specialist, assistance from a n expert in the target market, and coordination of a trade mission to 
this market. It is geared towards businesses that export to new destinations, export new products 
or services, or export new products or services to new destinations. To join the program me, the 
business must be formally registered, have exporting experience (over the previous two years at a 
minimum), have total sales of USD  100,000 or more and annual exports of at least USD  25,000, 
and have proven potential in the chosen markets.75 The pr ogramme also takes into account whether 
the businesses export to markets with which El  Salvador has free trade agreements. According to 
the data provided by the authorities, the value of exports of businesses benefiting from the 
Exporta  Más programme amoun ted to USD  2,178,642 during the period from 2016 to 2021.  
3.95.  Apart from the traditional programmes mentioned above, PROESA has introduced new export 
support lines to adapt to the requirements of exporters and markets. This new support includes: the 
Mujer Expo rta programme, which aims to guide women entrepreneurs on the steps to be followed 
to export for the first time or to export more; the Innovación para la Exportación  (IPEX) programme, 
which supports food and beverage exporters so as to ensure a high value -added and differentiated 
exportable supply in order to access niche markets; and the Programa de Gerentes , which seeks to 
 
73 Online information from PROESA. Viewed at: https://proes a.gob.sv//exportar -paso-a-paso/ . 
74 Online information from PROESA. Viewed at:  
https://proesa.gob.sv//club -empresarial -exportar -paso-a-paso/ . 
75 Online information from PROESA. Vie wed at: https://proesa.gob.sv//exportar -mas/. WT/TPR/S/440  • El Salvador  
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  increase business competitiveness, focusing on renewable energy and green technologies. 
Furthermore, in coordination with the Ministry  of Economic Affairs and the Ministry of Foreign Affairs, 
PROESA participates in the implementation of the Divulgación de Tratados de Libre Comercio  
programme to disseminate trade opportunities under the free trade agreements  (FTAs) signed by 
El Salvador. PROESA also facilitates exporters' access to financing, advising them on how to 
structure their business projects and validating these projects before they are submitted to the 
Development Bank of El  Salvador  (BANDESAL).  
3.96.  The manner in which PROESA provides  services to exporters has also been adapted, 
particularly after the COVID -19 pandemic, in response to strong demand for virtual means of doing 
business. It is estimated that 75 % of PROESA's activities will be carried out through such means in 
2023. The au thorities also consider that, while PROESA will continue to provide businesses with 
export training, this will not be a major part of its services in the future, as other institutions are 
dedicated to this.  
3.97.  Salvadoran exporters also receive support from th e National Commission for Micro and Small 
Enterprises  (CONAMYPE) attached to the Ministry of Economic Affairs. CONAMYPE offers services to 
micro - and small enterprises  (MSEs) wishing to export. Such services include foreign trade advice 
and export -focused technical assistance; mentoring during the first export operation; the 
development of export catalogues and support with international sample shipments; the promotion 
of MSE products at the international level through marketing agencies; export pricing sup port; and 
advice on accessing and penetrating new markets.76 CONAMYPE also operates export -oriented 
forums or platforms, such as EXPOMYPE (a virtual fair to boost MSE product marketing through 
digital means) and the FORO EXPORTASV, an exhibition event aime d at promoting MSEs' exportable 
supply and fostering their export culture. By September  2022, CONAMYPE had advised 1,200  MSEs, 
and 240  MSEs were contributing 1,009  products to El  Salvador's exportable supply in sectors such 
as food, beverages, textiles and  clothing, food agro -industry, services, natural cosmetics, 
miscellaneous manufactured articles, footwear, handicrafts and furniture.77 
3.2.5   Export finance, insurance, and guarantees  
3.98.  The Development Bank of El  Salvador (BANDESAL) is a public credit institution created in 
2012 by the Law on the Financial System for the Promotion of Development.78 Its aim is to facilitate 
access to financing for production sectors, giving priority to MSMEs and sectors not served by 
commercial banks, including agricultu re, agro -industry, industry, services, energy, exports, tourism, 
housing and production infrastructure. BANDESAL manages the Economic Development Fund  (FDE), 
which seeks to meet the financial needs of MSMEs, as well as the Salvadoran Guarantee Fund  (FSG), 
which provides additional guarantees to natural and legal persons. In addition, BANDESAL manages 
14 financial trusts.  
3.99.  In accordance with its roles and responsibilities, BANDESAL grants loans directly as a first -tier 
bank, as a second -tier bank through othe r financial institutions and using FDE resources. In general, 
the main purpose of loans offered by BANDESAL in their various modalities is to support production 
and competitiveness in productive sectors through financing for, inter alia , capital formation,  
industrial park expansion and conversion, machinery and equipment modernization, and energy 
efficiency projects. Only some loans are export -oriented, such as the direct credit line for 
agro-industry, which aims to finance the increase in production and in dustrialization of products so 
as to facilitate their export. Terms range from 5 to 10  years, and the rates are competitive. 
BANDESAL also makes available to eligible financial institutions a foreign trade line for working 
capital financing intended for en terprises exporting goods and services.79 
3.100.   The FSG offers guarantees to encourage eligible financial institutions to grant credit to 
businesses. On the one hand, it provides eligible institutions with automatic guarantees that are 
granted immediately, witho ut the need for prior authorization from the FSG, for a maximum 
coverage amount of USD  200,000 per beneficiary. On the other hand, for coverages over 
 
76 CONAMYPE, Exportación . Viewed at: https://www.conamype.gob.sv/blog/servicios/exportacion/ . 
77 CONAMYPE. Viewed at: https://www.conamype.gob.sv/blog/2022/11/14/desarrollamos -el-foro-
nacional -exportasv -para-formar -en-cultura -exportadora -a-la-micro -y-pequena -empresa -del-pais/. 
78 Legislative Decree No.  847 of 22  September  2012, amended by Legislative Decree No.  653 of 
4 June 2022 (see also Section  3.3.1.1).  
79 This line was not active at the time of writing this report.  WT/TPR/S/440  • El Salvador  
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  USD 200,000 or when the credit amount exceeds USD  400,000, the guarantee requires a prior risk 
assessment for the beneficiary and the approval of the BANDESAL Board of Directors. The FSG's 
automatic guarantees include a programme that guarantees up to USD  200,000 in working capital 
credit for export. The term is one year, and the maximum coverage is 70 % if the credit guaranteed 
is backed by the exporter's commercial invoice or 50 % if it is backed by purchase orders. Between 
2016 and 2021, the FGS provided guarantees totalling USD  260.4  million that supported an eligible 
institution credit portfolio of USD  489.7  million, with 0.11 % corresponding to export credit.80 
3.101.   The loans and guarantees granted by BANDESAL in support of exports are mostly directed 
to MSMEs and represent fairly modest amounts (Table  3.14). According to the information provided 
by the authoritie s, support to the export sector accounted for 1.3 % of total credit and guaranteed 
amounts provided by BANDESAL during the period from 2016 to 2021. The authorities explained 
that this small proportion is due to the fact that most of the credit requested by  businesses and 
granted directly by BANDESAL focuses on promoting economic activities within the country. At the 
same time, there is low activity in export -related credit granted by financial institutions.  
3.102.   As part of its non -financial product offering, BAN DESAL established the Business Training 
and Development Centre  (CEDE) in 2019 to provide enterprises with training and technical 
assistance on various business and investment topics, including a business training programme for 
the export sector in which 20  enterprises participated in 2021.  
Table 3.14 Amount of export credit and guarantees, 2016 -21 
(USD  million)  
Year  BANDESAL  
First-tier BANDESAL  
Second -tier Salvadoran Guarantee Fund 
(FSG)  
2016 1.4 8.7 0.2 
2017 0.0 2.6 0.1 
2018 0.0 0.0 0.0 
2019 0.0 0.0 0.0 
2020 0.0 0.0 0.0 
2021 11.0 0.0 0.0 
Source:  Information provided by BANDESAL.  
3.3  Measures affecting production and trade  
3.3.1   Incentives  
3.103.   The incentives given by El Salvador to its production sector focus on financial and technical 
support programmes for MSMEs, and promoting technology transfers and programmes to attract 
investment. In recent years, support has also been directed towards efforts to facilitate the recovery 
of enterprises affected by the COVID -19 crisis, to assist women entrepreneurs and to encourage 
investment in renewable energy and energy efficiency.  
3.3.1.1   BANDESAL  
3.104.   BANDESAL plays an important role in the implementation of support and financing 
programmes for the Salvadoran production sector. The Ban k's main objective are to provide financial 
and technical support to promote viable and profitable investment projects in the country in order 
to boost  the growth and development of all productive sectors; promote the development and 
competitiveness of ent repreneurs; foster the development of MSMEs; promote development and job 
creation; and improve education, art, sport, culture and health services.  
3.105.   In order to achieve these objectives, in addition to its functions as a first -tier and second -tier 
bank, BAND ESAL has extensive powers, which include granting loans in foreign currency to finance 
the importing and marketing of goods and services of Salvadoran origin in the destination countries; 
developing financial products in support of the regionalization of S alvadoran industries; 
 
80 Information provided by BANDESAL.  WT/TPR/S/440  • El Salvador  
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  implementing training and technical assistance programmes for enterprises; and managing the 
resources of the Economic Development Fund (FDE) and the Salvadoran Guarantee Fund (FSG).81 
3.106.   On 17  June 2020, an amendment to the BANDESAL Law entered into force, which changed 
the law's name to the Law on the Development Bank of El Salvador and the name of the institution 
to the Development Bank of El Salvador. Under the amendment, BANDESAL has greater scope for 
action and new funct ions, such as powers to consolidate loans granted by other financial institutions, 
provided that they were intended for financing productive activities; powers to apportion up to 50 % 
of its profits to credit programmes with special conditions for projects setting out to enhance health, 
art, culture and sport; and powers to establish special conditions for financing specific social -impact 
projects.82 Corporate governance reforms were also introduced, as well as other changes.83 
3.107.   As a first -tier bank, BANDESAL finances investment projects of up to USD  40 million, for up 
to 80 % of the investment and with a maximum of 15 % of its net assets with a single c ustomer.84 
Loans are granted for viable and profitable projects in all economic sectors, with terms of 
1 to 15 years depending on the type of loan and with competitive rates of interest. During the review 
period, BANDESAL consolidated its first -tier loans across 11 lines of credit, which are summarized in 
Table A3.2. According to the authorities, at the end of June  2022, BANDESAL's portfolio was made 
up of 110 direct loans worth USD  182.1  million, mainly to the services and construction sectors.  
3.108.   As a second -tier bank, BANDESAL offers loans to users through 63 eligible financial 
institutions. There are 15 medium - and long -term indirect credit lines (up to 20 years), aimed mainly 
at MSMEs, including women -led companies. These credit lines include loans for inv esting in coffee 
plantations, energy -efficiency schemes and economic -recovery programmes (Table A3.3). At the 
end of June  2022, the indirect -loan portfolio stood at USD  365.7  million, with the majority of these 
loans to the services and trade sector.85 In accordance with the BANDESAL Law, the interest rates 
applied by the Bank to eligible financial institutions must not be lower than the institutions' actual 
cost of raising capital from the public so as not to disincentivize these institutions from handling  
transactions with the public.86 The interest rates applied to financial intermediaries vary depending 
on whether the intermediary is a regulated on a non -regulated institution (surcharges apply to 
non-regulated institutions) and the term of the loan. Tabl e 3.15 sets out the rates applied to financial 
intermediaries for credit lines which do not have an interest rate set under the conditions approved 
by BANDESAL  
Table 3.15 Lending rates applied by BANDESAL to f inancial intermediaries, 2022  
Term  Regulated institutions  Non-regulated institutionsa 
Up to 1 year  5.75%  6.00% -6.50%  
From 1 year to 5 years  6.00%  6.25% -6.75%  
From 5 year to 7 years  6.25%  6.50% -7.00%  
From 7 year to 10 years  6.50%  6.75% -7.25%  
From 10 year to 15 years  6.75%  7.00% -7.50%  
From 15 year to 20 years  7.00%  7.25% -7.75%  
Over 20 years  7.25%  7.50% -8.00%  
a Non-banking institutions, coffee -producing entities and sugar mills.  
Source:  Information provided by BANDESAL.  
3.109.   Through the FDE, BANDESAL grants short -, medium - and long -term direct loans through 
17 financing facilities, mainly to MSMEs, for investment projects across a range of productive 
 
81 Article 55 of the Law on the Development Bank of El Salvador.  
82 Pursuant to Article 51 of the new Law, BANDESAL can create lines of credit with special conditions for 
projects with the following objectives: (i) to have a significant impact on environmental rehabilitation and 
maintenance; (ii) to plant and maintain non -traditional permanent crops; (iii) to provide suppor t for 
traditionally excluded economic sectors; (iv) to provide people with limited means with access to education; 
and (v) to revitalize a specific economic sector, in emergency situations.  
83 Legislative Decree No. 653. Amendments to the Law on the Financi al System for the Promotion of 
Development, 4 June 2020. Viewed at: http://extwprlegs1.fao.org/docs/pdf/els195901.pdf . 
84 Article 45 of the Law on the Development Bank of El Salvador.  
85 Information provided by the authorities.  
86 Article 47 of the Law on the Development Bank of El Salvador.  WT/TPR/S/440  • El Salvador  
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  activities (Table A3.4). BANDESAL is required by law to maintain at all times a ratio of at le ast 12 % 
between its regulatory capital and its total risk -weighted assets.87 
3.110.   The FSG provides users with guarantees to reduce risk for financial intermediaries. Its 
programmes include guarantees for women entrepreneurs, tourism, education and, in particula r, 
MSMEs that cannot otherwise obtain financing on the open market (Table A3.5).  
3.111.   According to data provided by the authorities, between 2016 and 2021, direct loans granted 
by BANDESAL totalled USD  243.6  million, while credit provided by the Bank through fi nancial 
intermediaries amounted to USD  1.203  billion. During the same period, the FDE granted 1,650 loans 
for a total contracted amount of USD  130.6  million, and the FSG provided 70,049  guarantees worth 
USD 260.4  million in total.  
3.112.   At the end of June  2022, BANDESAL's total assets stood at USD  275.8  million. As of the 
same date, the combined assets of the FDE and FSG amounted to USD  105.4  million. BANDESAL 
also manages 14 financial trust funds, including, the Trust Fund for the Economic Recovery of 
Salvadoran  Companies (FIREMPRESA) and the Trust Fund for Micro - and Small Enterprises 
(FIDEMYPE).  
3.113.   In order to mitigate the effects of the COVID -19 pandemic on the Salvadoran economy, the 
FIREMPRESA trust fund, which is managed by BANDESAL, was created through Legisl ative Decree 
No. 685 of 15  July 2020. In October  2022, the trust fund was authorized to disburse up to 
USD 710 million, which was divided between wage subsidies and formal and informal loans.88 These 
subsidies pay 50 % of the salaries of employees of formal  MSMEs. Through the "Loans for the Formal 
Sector" and "Productive Financing for the Informal Sector" programmes, FIREMPRESA grants soft 
loans with a 3 % annual interest rate, a 10 -year term and a 1 -year grace period on paying the 
first instalment. Between 1  October  2020 and 30  June 2022, FIREMPRESA provided 
USD 360.4  million in loans to support 5,657 formal -sector enterprises, USD  141.6  million for 
27,666  million informal -sector enterprises and USD  59.8 million in subsidies to help pay 
MSME  employees.89 In December  2020, FIREMPRESA began to redirect its funds to other vulnerable 
sectors affected by the pandemic, in particular, artists, artisans, fishers, school and tourism 
transport, taxi drivers and people with disabilities. By August  2022, 23,857 people had  received a 
total of USD  26.4 million.  
3.114.   BANDESAL also manages the FIDEMYPE trust fund, with financing from the Inter -American 
Development Bank (IDB). This fund channels resources through financial intermediaries in order to 
grant loans to MSMEs. BANDESAL placed USD  63.6 million across 28,850  loans during the 
2016-21 period through this trust fund.90 
3.3.1.2   Support to micro -, small and medium -sized enterprises  
3.115.   In addition to the aforementioned financial support, micro - and small enterprises (MSEs) can 
benefit from the support programmes offered by the National Commission for Micro - and Small 
Enterprises (CONAMYPE). CONAMYPE, which is attached to the Ministry of Economic Affairs, is 
responsible for promoting, protecting and developing MSEs and implementing domestic policies for 
the promotion and competitiveness of these enterprises. The Ministry is responsible for framing and 
defining these policies.  
3.116.   The Law on the Promotion, Protection and Development of Micro - and Small  Enterprises (or 
the MSE Law, Legislative Decree No.  667 of 25  April 2014) defined the functions of CONAMYPE and 
the concepts of micro - and small enterprises91, created a public -private institutional coordination 
mechanism to facilitate the implementation of MSE support policies and required state banks to 
 
87 Article 26 of the Law on the Development Bank of El Salvador.  
88 Legislative Decree No.  540 of 18 October 2022.  
89 Information provided by the authorities.  
90 Information provided by the authorities.  
91 According to Article 3 of this Law, micro - and small enterprises are defined as: (i) microenterprise: a 
natural or legal person operating with annual gross sales up to 482 times the monthly minimum wages and up 
to 10 workers; and (ii) small enterprises: a natural or legal person operating with annual gross sales from 
482 to 4,817 times the monthly minimum wages and up to 50 workers.  WT/TPR/S/440  • El Salvador  
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  promote these enterprises' access to credit and other financial services. CONAMYPE runs 11 support 
programmes and oversees 14 Micro - and Small Enterprise Development Centres.92 
3.117.   Since the previous review, the MSE Law has been amended twice. Through Legislative 
Decree No.  838 of 15  November  2017, a gender approach was incorporated into the Law and 
CONAMYPE was given the responsibility of disseminating information about export opportunities and 
access to inte rnational markets to MSEs, as well as other changes. Legislative Decree No.  64 of 
15 June 2021 amended the operating mechanism for the Fund for Entrepreneurship and Working 
Capital (FECAMYPE) and the Guarantee Programme for Micro - and Small Enterprises (PR OGAMYPE), 
which were created by the MSE Law, to guarantee these enterprises' access to credit. The objective 
of FECAMYPE is to grant direct loans to MSEs, particularly enterprises with technological or 
environmental components, or that promote entrepreneur ship among women or gender equality. 
PROGAMYPE guarantees short -, medium - and long -term loans for up to 90 % of the amount financed. 
In 2021, the FECAMYPE trust fund was set up, with an initial capital of USD  10 million. PROGAMYPE 
received a USD  5 million f und in 2022.  
3.118.   In December  2020, CONAMYPE introduced the policy to promote MSE involvement in public 
procurement and ensure that government bodies fulfil their obligation to purchase at least 25 % of 
their goods and services from MSEs (Section 3.3.6). The pol icy seeks to remove the barriers faced 
by MSEs in government procurement and in the tender submission process.  
3.119.   The Ministry of Economic Affairs also operates a number of MSE support programmes, such 
as training for the restructuring of business models, dri ving innovation and competitiveness, market 
opportunities and taking advantage of trade agreements.93 A number of these programmes are 
implemented using resources from the Productive Development Fund (FONDEPRO). FONDEPRO is a 
non-reimbursable co -financing fund that sets out to make Salvadoran enterprises more competitive, 
to increase their domestic and foreign market shares, and to promote job creation. FONDEPRO's 
contribution can range from USD  1,500 to USD  100,000, depending on enterprises' intended 
busin ess activities, their geographical locations (within or outside of the San Salvador metropolitan 
area) and the lead times for the business activities. The Fund has five support lines: innovation and 
technology; market development; quality; cleaner producti on; and productivity. The strategic 
sectors supported include nine industrial activities and seven service activities (Table  3.16).  
Table 3.16 FONDEPRO: support lines and main strategic sectors  
Support lines   
Innovation and 
technology  Technology acquisition, shipping and installation of technology equipment, infrastructure 
upgrades, technical assistance, process and product innovation, human resource training, 
prototype development, technology transfers, and intellectual property creation and protection.  
Market development  Product launches, the design and implementation of digital marketing strategies for exports, 
translation services, adaptation of products for exports, packaging, labelling, product 
promotion abroad, business travel and related expenses, identification of distributors, 
sending samples, brand image for exports, product analysis, promotional material (design 
and printing), among other things.  
Consistent quality  Quality assessments, inf rastructure upgrades to comply with quality standards, the 
certification of standards and processes, implementation of quality systems, human resource 
training, introduction of machinery and equipment in order to comply with quality systems, 
and technical assistance.  
Cleaner production, 
energy efficiency and 
renewable energy  Energy -efficiency and cleaner -production assessment, acquisition and installation of more 
efficient technology powered by renewable energy, infrastructure upgrades, technical 
assistan ce, human resources training and development.  
Productivity  Specialized -system assessments, implementation of specialized software, installation of 
equipment, assessment -based actions, and technical assistance to make processes more 
productive and efficie nt. 
Strategic sectors   
Industry  Agri-business; food and beverages; crafts for export; footwear, leather and accessories; 
electronics; paper and cardboard; plastics; chemicals, pharmaceuticals and natural 
cosmetics; and textiles and clothing.  
Services  Aeronautics, creative industries, computer industry, logistics and transportation, business 
services, medical services and tourism.  
Source:  Information provided by the authorities.  
 
92 These programmes cover areas such as entrepreneurship, business acceleration, a dministrative 
management, financial education and enhancing production, quality, marketing and formalization. For more 
detailed information, see the CONAMYPE website at: https://www.conamype.gob.sv/blog/servicios/servicios/ . 
93 MINEC, Programas . Viewed at: https://www.economia.gob.sv/guia -de-programas/ . WT/TPR/S/440  • El Salvador  
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  3.120.   The general requirements for applying to FONDEPRO are as follows:  applicants must be a 
Salvadoran enterprise that produces goods or services, have gross sales worth between 
USD 100,000 and USD  15 million and exports worth no more than USD  7 million, have been 
operating for at least two years, have formal accounting reco rds, submit up -to-date formal financial 
and legal information, be financially capable of performing the required activities, be up -to-date with 
their labour obligations and be located anywhere in the national territory. There are other conditions 
and requi rements specific to each type of support and/or activity, which are set out in the Fund 
regulations. Since it was created in 2002, FONDEPRO has placed more than USD  40 million with 
some 1,200 enterprises and 2,800 initiatives. It is estimated that, during the last five years, each 
dollar committed has generated USD  12.1 in incremental sales.94 
3.3.1.3   Sector -specific incentives  
3.121.   El Salvador offers incentives for investing in renewable energies (Section 4).  
3.122.   In the financial sector, the Law on Investment Funds, enacted by Decree No.  77 of 
19 September  2014, seeks to encourage public participation in investment funds in the country. The 
Law classifies these funds into two types: open -ended funds and closed -ended funds.95 The tax 
benefits given to the funds' invest ors are summarized in Box 3.1.  
Box 3.1 Benefits of investing in investment funds  
Exemption from income tax (ISR), VAT and any other type of taxes, fees and special fiscal contributions.  
Exemption from the real estate transfer tax for property transfers to closed -ended investment funds, as 
contributions, and for property acquisitions by closed -ended investment funds. Exemption from all 
assignment, endorsement, registration and marginal annotation fees for th e transfer of movable assets or 
real estate made for the purpose of setting up an investment fund.  
Exemption from ISR on income, returns and profits from investments in open -ended or closed -ended funds 
during the first five years following the establishme nt of the first investment fund.  
Natural or legal persons not domiciled in the country shall enjoy a reduced income tax rate of 3%.  
Source:  PROESA, Guía del Inversionista  2020. Viewed at: https://bit.ly/30zNU5S . 
3.3.2   Standards and other technical requirements  
3.123.   The Agreement on Technical Barriers to Trade (TBT Agreement) became national law as a 
result of the ratification of the Marrakesh Agreement in 1995.96 The enquiry point provided for in 
Articles 10.1 and 10.3 of the T BT Agreement is the Directorate for the Administration of Trade 
Agreements (DATCO) of the Ministry of Economic Affairs, which is  also responsible for submitting 
the notifications required by the Agreement. During the review period, no specific trade concer ns 
were raised in the TBT Committee about measures applied by El Salvador.  
3.124.   El Salvador submitted 58 notifications to the TBT Committee between January  2016 and 
July 2022.97 Approximately a third of the notifications related to foodstuffs (ground and green coffee 
beans, dried fish, poultry and dairy products), with the objective of ensuring food safety and 
protecting human health. Another third of the notifications related to domestic electrical appliances 
(refrigerators, air conditioners and lighting equipm ent), with the aim of preventing deceptive 
practices and ensuring consumer protection. Due to the COVID -19 pandemic, pursuant to  
Article  2.10 of the TBT  Agreement , four emergency technical regulations on medical devices and 
medicines for human use were not ified, as well as others relating to information technologies. These 
technical regulations remained in force for one year and, upon expiration, the usual regulatory 
drafting process was followed, with a 60 -day national and international consultation period  and the 
 
94 Information provided by the authorities.  
95 The difference  between open -ended and closed -ended funds is that investors in open -ended funds can 
withdraw their investments, in full or in part, at any time, while investors in closed -ended funds only receive 
the amount corresponding to their shares at the end of a fi xed period. Open -ended funds must have a 
minimum capital of USD  350,000 and at least 50 investors, or 10 if one of these is an institutional investor. 
Closed -ended funds must have a minimum capital of USD  350,000  and at least 10 investors, or two if one is  an 
institutional investor.  
96 WTO document G/TBT/2/Add.78, of 22 March 2004.  
97 WTO documents G/TBT/N/SLV/183, of 25 August 2016, and G/TBT/N/SLV/221, of 7 July 2022.  WT/TPR/S/440  • El Salvador  
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  relevant notification to the WTO. The other notifications followed this 60 -day timeframe and, in some 
instances, this period was extended. El Salvador has not notified the WTO of any mutual recognition 
agreement on technical regulations, conformit y assessment procedures or standards.  
3.125.   The legal -institutional framework established in 2011 by the Law creating the Salvadoran 
Quality System98 has not been substantially amended during the review period. The National Quality 
Council is the governing body of the system, and is, in turn, made up of four technical bodies: the 
Salvadoran Technical Regulation Agency (OSARTEC), the Salvadoran Standard ization Agency (OSN), 
the Salvadoran Accreditation Agency (OSA) and the Metrological Research Centre (CIM). The most 
recent amendment to the Law creating the Salvadoran Quality System, enacted by Legislative 
Decree No.  40 of 5  June 2021, made some changes to the membership of the National Quality 
Council without changing its rules.  
3.126.   The Salvadoran Technical Regulation Agency (OSARTEC) is responsible for coordinating the 
adoption, adaptation, updating and publication of Salvadoran mandatory technical regulati ons. 
These instruments are known as Salvadoran Technical Regulations (RTS) and were originally referred 
to as Salvadoran Mandatory Standards (NSO), prior to the Law Creating the Salvadoran Quality 
System. In accordance with the Law, all technical regulatio ns applied by El Salvador must comply 
with the TBT Agreement and with the WTO Agreement on the Application of Sanitary and 
Phytosanitary Measures (SPS Agreement). OSARTEC's functions include ensuring compliance with 
existing international guidelines and wi th El Salvador's commitments in the area of technical 
regulations.  
3.127.   The authorities have indicated that the majority of RTS included in their conformity 
assessment procedures are based on international standards.99 
3.128.   As a member of the Central American Common  Market (CACM), El Salvador applies the 
Central American Regulations on Standardization Measures, Metrology and Authorization 
Procedures100 and the Central American Guide to Good Regulatory Practices101 and its annexes, when 
drafting Central American Technical Regulations (RTCA). As part of its efforts to eliminate any 
inconsistencies between NSO, RTS and RTCA, OSARTEC has, since 2011, repeale d 29 NSO and has 
replaced them with RTS or RTCA102, and plans to take steps to repeal 12 more. OSARTEC has online 
databases of all of the technical regulations in force. In July  2022, there were 32 RTS, 81 NSO and 
92 RTCA.103 In the Salvadoran system, there are no legal provisions requiring a technical regulation 
be updated or expire within a specific time period, instead these steps are taken as and when 
necessary.  
3.129.   The procedures for drafting RTS have not changed during the review period. They are based 
on the Handbook of Good Technical Regulation Practices drawn up by OSARTEC, which sets out the 
principles for and stages of drafting, reviewing and approving technical regulations, including public 
consultation and international notification. The steps are out lined in Chart  3.2. At the time of writing 
this report, OSARTEC was updating the Handbook, with a view to turning it into mandatory 
regulations for drafting Salvadoran Technical Regulations; the final version is expected to be ready 
before the end of 2022.  
3.130.   Natural and legal persons and government bodies may ask OSARTEC to draw up technical 
regulations. OSARTEC determines whether the request should be included in the Annual Technical 
Regulations Plan. If OSARTEC decides to include the request, it checks whet her the draft technical 
regulation is in line with international standards. OSARTEC then sets up a national technical 
regulation committee, composed of public sector representatives, which is responsible for drawing 
up the draft technical regulation and ad dressing any related comments. It then sets up a consultation 
committee involving all relevant sectors in order to come to an agreement on the draft technical 
 
98 Legislative Decree No.  790 of 04 September 2011. Viewed at: 
https://www.asamblea.gob.sv/sites/default/files/documents/decretos/64319787 -F4DE-447E-A137-
0EDFB85E13B9.pdf . 
99 Given their structure, RTS include requirements r elated to conformity assessment procedures.  
100 Resolution No. 37 -99 (COMIECO -XIII) of 17 September 1999.  
101 Resolution No. 390 -2017 (COMIECO -LXXX) of 28 June 2017.  
102 OSARTEC, Register of NSO that have been repealed and replaced by RTCA or RTS. Viewed at: 
http://osartec.gob.sv/?servicios=derogaciones . 
103 OSARTEC, Lists of RTS, NSO and RTCA. Viewed at: http://osartec.gob.sv/?servicios=inv entario -rts, 
http://osartec.gob.sv/?servicios=inventario -nso and http://osartec.gob.sv/?servicios=inventario -rtca. WT/TPR/S/440  • El Salvador  
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  regulation. The regulation will then be subject to national and international public consultation  for 
60 calendar days, which may be extended by a further 30 days. Any comments received are reviewed 
in meetings convened by OSARTEC, attended by representatives of the public and private sectors, 
academia and consumers. Once the technical regulation has been approved by the National Technical 
Regulation Committee, OSARTEC submits it for endorsement to the competent regulatory authority, 
which issues the relevant legal instrument and publishes it in the Official Journal.  
3.131.   El Salvador applies technical regul ations on labelling for products such as textiles, footwear, 
cosmetics, medicines, food and beverages.  
3.132.   The Salvadoran Standardization Agency (OSN) is responsible for drafting, updating, 
adopting, adapting, repealing and publishing Salvadoran Technical Stan dards (NTS) which facilitate 
conformity assessment. Unlike RTS, NTS are voluntary. According to the OSN catalogue, in 
July 2022, there were 1,522 technical standards in force in El Salvador. The most common NTS refer 
to food technologies (almost a third of  the total), followed by, inter alia , management systems, 
construction materials, health, industrial safety and occupational hygiene, technical design, 
information technology, textiles and tourism.104 The OSN is also responsible for developing an annual 
standardization programme; under the 2022 -23 programme, 90 standards are expected to be drawn 
up, mainly in relation to health and food. With regard to conformity assessment, the OSN provides 
certification services that take into account national and internat ional standards. To date, it has 
developed seals of quality and given certifications for biosecurity, tourism quality, quality 
management and products.  
3.133.   Any interested party may ask the OSN to create a new Salvadoran Technical Standard. In 
such cases, the O SN sets up a technical standardization committee (CTN), comprising public and 
private actors, which reviews the request and prepares a draft technical standard. This draft technical 
standard is then subject to public consultation for 30 days if it is an id entical copy of an existing 
international standard, or for 60 days if the standard is new and unique to El Salvador. The 
CTN reviews any comments made and develops the draft standard, which is submitted to the OSN 
for approval. Once the standard is approve d, steps are taken to publish it.  
3.134.   The OSN represents El Salvador at the International Organization for Standardization (ISO), 
the International Electrotechnical Commission (IEC) and the American Society for Testing and 
Materials (ASTM). At the regional lev el, El Salvador is a member of the Pan  American Standards 
Commission (COPANT), the Central American and Caribbean Standardization Commission, and the 
Inter-American Metrology System (SIM).  
 
104 Informa tion from the OSN. Viewed at: http://www.osn.gob.sv/servicios/normalizacion/catalogo -de-
normas/ . WT/TPR/S/440  • El Salvador  
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  Chart 3.2 Flow chart  for the drafting of technical regulations  
 
Source:  OSARTEC, Guía de Buenas Prácticas de Reglamentación Técnica . Viewed at: 
http://osartec.gob.sv/?servicio s=guia -de-buenas -practicas -de-reglamentacion -tecnica . 
3.135.   The Salvadoran Accreditation Agency (OSA) is responsible for accrediting calibration, testing 
or sampling laboratories, inspection agencies, certification agencies and any other compatible 
system. In ac cordance with the Law creating the Salvadoran Quality System, the OSA must work on 
the basis of the criteria laid down in the ISO standards and guides, the guidelines of Inter -American 
Accreditation Cooperation (IAAC), the International Laboratory Accredit ation Cooperation (ILAC), 
and the International Accreditation Forum (IAF) The requirements for requesting accreditation and 
the steps that must be followed are set out on the OSA website.105 
3.136.   During the period under review, El Salvador continued to expand it s network of accredited 
conformity assessment bodies. In 2022, 87 public and private institutions were accredited: 
64 testing laboratories, 8 calibration laboratories, 4 clinical laboratories, 11 inspection bodies and 
2 management -system certification bodi es. The OSA has received international accreditation from 
the IAAC and ILAC for its testing laboratories (2014), calibration laboratories (2017) and inspection 
bodies (2018), and is expected to obtain accreditation in additional areas soon. Consequently, t he 
results of OSA -accredited bodies are recognized in more than 100 countries.  
3.137.   The Metrological Research Centre (CIM) is the technical body responsible for scientific, 
industrial and legal metrology in El Salvador. In addition to coordinating the national metrology 
system, its functions include acting as the national laboratory for the Salvadoran Quality System, 
maintaining national measurement  standards, ensuring the dissemination of the standards and 
traceability to the International System of Units (SI),  providing research laboratories and verification 
agencies with services for calibrating measuring standards and instruments, and issuing the relevant 
certificates.106 
3.3.3   Sanitary and phytosanitary measures  
3.138.   El Salvador's legal framework for sanitary and phytos anitary measures (SPS) has not 
substantially changed since the most recent trade policy review. This framework is mainly made up 
of the Law on Plant and Animal Health107, the regulations on the preparation of standards containing 
 
105 Information from the OSA. Viewed at: http://www.osa.gob.sv . 
106 Article 16 -IV of the Law creating the Salvadoran Quality System.  
107 Legislative Decree No.  524 of 18 December 1995.  
WT/TPR/S/440  • El Salvador  
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  phytosanitary and animal he alth measures in accordance with the Law on Plant and Animal Health108, 
the Health Code, the National Law on Organic Farming109, and the Law creating the Salvadoran 
Quality System, as well as other legislation. The WTO's Agreement on the Application of Sanitary 
and Phytosanitary Measures (SPS Agreement) has been incorporated into domestic law in 
El Salvador.  
3.139.   Recently, the authorities have drawn up a draft law to protect health, animal health and food 
safety, which sets out to modernize nat ional regulations and adapt them to international standards 
in order to facilitate trade, while also ensuring sanitary and phytosanitary protection. A new aspect 
of the proposed law is the chapter on the safety of food of animal and plant origin, which est ablishes 
the basis for certification processes for foods of animal origin, for the seizure of foods suspected of 
posing a danger to human and animal health, and for measures to prevent food adulteration. It also 
explicitly recognizes the standards and guid elines of international reference organizations. At the 
time of writing this report (late 2022), the proposed law was expected to be subject to public 
consultation, before being submitted to the legislature.  
3.140.   The Directorate for the Administration of Trade Agreements (DATCO) within the Ministry of 
Economic Affairs serves as the national enquiry point and is responsible for notifications under the 
SPS Agreement. El Salvador submitted 33 notifications to the WTO's Committee on Sanitary and 
Phytosanitary Measur es (SPS Committee) between January  2016 and November  2022.110 Of these 
notifications, half related to RTS and RTCA and the rest concerned updates to existing technical 
regulations. A 60 -day consultation period was set for all of these notifications, with the exception of 
some notifications relating to emergency meas ures. The products covered by the notifications 
include drinking and waste water, salted fish, poultry, livestock (sheep and cattle), coffee, veterinary 
medicines and dairy products. Of the total, eight referred to an international standard 
(Codex  Alimenta rius, WOAH or IPPC). During the review period, no WTO  Member has raised a trade 
concern in the SPS  Committee regarding El Salvador's sanitary or phytosanitary measures.  
3.141.   El Salvador applies the Central American Regulations on Sanitary and Phytosanitary 
Measures and Procedures, whose purpose is to ensure that sanitary and phytosanitary measures do 
not directly or indirectly affect intraregional trade.111 El Salvador recognizes registration certificates 
issued by the regulatory authorities of CACM member countr ies for fertilizers, pesticides and other 
agricultural inputs112, as well as those for medicines for human use that have been registered 
pursuant to harmonized legislation.113 It also recognizes the sanitary registration certificates for food 
and beverages i ssued by Guatemala, Honduras, Nicaragua and Costa Rica.114 Under the 
CAFTA -DR Agreement, El Salvador recognizes the equivalence of the United States meat and poultry 
inspection system, and, since 2018, has accepted certificates from the Seafood Inspection P rogram 
of the National Oceanic and Atmospheric Administration for fish and seafood farmed and cultivated 
in the United States. El Salvador also recognizes the equivalence of Chile's sanitary measures for 
fishery product inspection systems.115 Under the Asso ciation Agreement between Central America 
and the European Union, El Salvador recognizes the inspection systems for establishments 
processing products of animal and plant origin for human consumption in European Union 
member  States. El Salvador has not not ified the WTO's SPS Committee of any agreement that 
recognizes the equivalence of measures.  
3.142.   El Salvador is a member of the World Organisation for Animal  Health (WOAH) and has signed 
the International Plant Protection Convention (IPPC). The Ministry of Agri culture and Livestock is the 
focal point for both organizations. El Salvador is also a member of the Codex Alimentarius 
Commission and its focal point is OSARTEC. In 2021, the National Codex Committee endorsed the 
Strategic Plan of the National Codex Progr amme 2022 -24, the main objectives of which are to ensure 
 
108 Executive Decree No.  45 of 10 June 1997.  
109 Executive Decree No.  52 of 12 May 2004.  
110 WTO documents G/SPS/N/SLV/123, of 23 August 2016, through G/SPS/N/SLV/141, of 
31 October  2022.  
111 Resolution No. 271 -2011 (COMIECO -LXI) of 17 September 1999.  
112 Legislative Decree No.  315 of 10 May 1973.  
113 Resolution No. 446 -2021 of 28 April 2021  (COMIECO -XCIV).  
114 Resolution No. 80 -2001 (COMIECO -XVII) of 24 October 2001, and Resolution No. 92 -2002 
(COMIECO -XXIV) of 27 September 2002.  
115 Executive Decision No.  18-2015, Official Journal No.  28, Volume No.  406 of 11 February 2015.  WT/TPR/S/440  • El Salvador  
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  the availability of safe food, protect consumers' health and facilitate international food trade.116 At 
a regional level, El Salvador belongs to the International Regional Organization for Plant and A nimal 
Health (OIRSA).  
3.143.   The Ministry of Agriculture and Livestock (MAG), through the Directorate -General of 
Livestock (DGG) and the Directorate -General of Plant Health (DGSV), issues regulations on animal 
and plant health, agricultural quarantine and the reg istration and control of agricultural inputs. The 
MAG follows the same procedure for drafting and adopting SPS measures as that followed for 
technical regulations (Section 3.3.2). The Ministry of Health, through the Food and Beverages Unit 
of the Environme ntal Health Directorate, is responsible for issuing regulations for ensuring food 
safety.  
3.144.   The MAG has the power to issue regulations and determine procedures for the entry and 
transport to and within the national territory of plants and animals, the produc ts and by -products 
thereof.117 Imports will be admitted only if they come from countries whose inspection systems, 
veterinary services, systems for food safety and phytosanitary surveillance of quarantine pests and 
diseases have been assessed and approved b y the DGG or the DGSV, as appropriate. In the event 
that the exporting country's system has not been approved, imports may only come from individual 
plants or establishments approved by the DGG or the DGSV. Based on the findings of their 
assessments, the D GG and DGSV may impose sanitary or phytosanitary requirements as a condition 
for allowing imports. The requirements will vary based on the product's level of risk and may take 
the form of a certificate issued by the exporting country, inspection at the poi nt of entry, special 
treatment or quarantine. With regard to pest risk analysis, the authorities have stated that they 
apply ISPM No.  1. 
3.145.   El Salvador does not require importers of plants, animals or their products and by -products 
to be included in a special  register. However, an authorization issued by the MAG is required to 
import the majority of these products, in addition to the official sanitary or phytosanitary certificate 
issued by the authority of the country of origin. The Agricultural Health Informa tion System (SISA) 
is an online database, managed by the MAG, where the sanitary and phytosanitary requirements 
applying to specific products may be consulted, together with the products and countries of origin 
for which a sanitary/phytosanitary evaluation  by the MAG's competent authorities is a prerequisite 
for imports.118 In order to facilitate trade, the MAG is involved in the CIEX platform, where users can 
register and generate most sanitary and phytosanitary import authorizations online, as well as 
import visas for agricultural inputs (Section 3.1.1.1).  
3.146.   According to the Health Code, the Ministry of Health (MINSAL) is responsible for determining 
the minimum requirements for food, whether it is produced in the country or imported.119 The 
procedure for draft ing and adopting these requirements is the same as that for technical regulations.  
3.147.   In order to import processed food or beverages, authorization must be obtained from MINSAL 
and a sanitary registration certificate must first be issued by the Food and Bever ages Unit of the 
Environmental Health Directorate of MINSAL.120 Sanitary registration is required both for national 
and foreign products. In March  2022, MINSAL introduced changes to the sanitary registration 
process for pre -packaged food and beverages.121 The objectives of these changes include 
streamlining the procedure by allowing temporary registration and facilitating accreditation of 
certificates of free sale or equivalent documents issued by the authorities of the exporting countries. 
The sanitary regis tration requirements for food and beverages produced abroad are summarized in 
Box 3.2.  
 
116 OSARTEC. Viewed at : http://osartec.gob.sv/?p=5670 . The Strategic Plan can be viewed at: 
https://drive.google.com/file/d/1OMwvygVp BAhaSb7OJ_4v0yu2mB6xxUoI/view?usp=sharing . 
117 Article  13 of the Law on Plant and Animal Health.  
118 MAG, Sistema de Información en Sanidad Agropecuaria . Viewed at: 
http://sistemas.mag.gob.sv/sisa_consultas_web/pages/consulta_productos_vet_01.jsf  and 
http://oas.mag.gob.sv/sisa/tramites.jsp . 
119 Article 94 of the Health Code.  
120 Articles 88 and 95 of the Health Code.  
121 Sanitary Register Regulations for Products classified in Risk Class A, B, C and the Special 
Authorization for the Import of Pre -packaged Food and Beverages, Agreement No. 390 of the executive 
authority for health, published in Official Journ al of 8 March 2022.  WT/TPR/S/440  • El Salvador  
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  3.148.   The sanitary registration application is processed through the Comprehensive 
Environmental -Health Information System (SISAM) of MINSAL, which is linked to CIEX and the 
Regional Sanitary Register Integration System (SIRRS). Provided they meet the requirements, 
within eight working hours of submitting the application, importers will receive a temporary 
registration which is valid for three months. If the subsequent laborato ry test results are satisfactory, 
the registration will become definitive, which is valid for five years. SISAM enables users to view the 
full list of their sanitary registrations and their applications.122 
3.149.   As a general rule, laboratory analyses are perform ed by the National Public Health 
Laboratory, which is an agency of the National Institute of Health. Private laboratories may perform 
analyses on national holidays only, in which case, these analyses must be validated subsequently 
by the Laboratory for Foo d Quality Control and Toxicology of MINSAL.123 
Box 3.2 Requirements for the registration of foreign foods and beverages  
Documents to be submitted with the application  
Certificate issued by the competent health authority of the country of origin, which may be a certificate of free 
sale, sanitary certificate, export certificate, health certificate, quality certificate or similar, depending on the 
country issuing it.  
Label or draft label for each food and b everage submission; the original label if the application is to renew the 
registration, and a sketch if it is a new registration application.  
A list of ingredients, in descending order, i.e. from highest to lowest, as a percentage of the mass.  
Valid oper ating permit for the warehouse where the product will be stored, or a three -month temporary 
operating permit.  
Copy of the microbiological and physicochemical analyses, as appropriate, performed by the manufacturer or 
by a third party at the request of an interested party.  
Sworn declaration from the sanitary registration applicant, in accordance with the model provided by the 
competent authority.  
Laboratory analysis  
Submission of three samples of 200 grams for solid foods or 200 millilitres for liquids, properly labelled with 
a batch number and expiry date for each product.  
Source:  Secretariat of the WTO, based on information from the MINSAL transparency portal. Viewed at: 
https://www.transparencia.gob.sv/institutions/minsal/services/1010 . 
3.150.   Importers of foods and beverages who have already registered with the sanitary register 
must submit an online import application for each operation through CIEX. To this end, importers 
must be registered in SISAM and in the CIEX Foreign Trade Facilitation System, must complete the 
import application and must be duly registered in the sanitary register. The authorization is issued 
automatically.124 The same procedure is followed for the acc reditation of food and beverage sanitary 
registration certificates issued by the authorities of CACM member countries. El Salvador also 
recognizes the food and beverage sanitary registration certificates from member countries of the 
European Union and from  the United Kingdom, pursuant to the respective partnership agreements 
in force.  
3.151.   As stated in the previous TPR report, genetically modified foods may be imported into 
El Salvador, provided that they comply with the provisions of the Special Regulations on the safe 
handling of genetically modified organisms.125 
3.152.   The National Directorate of Medicines (DNM), an autonomous legal public entity, is 
responsible for regulating and overseeing pharmaceutical products, cosmetics and hygiene products, 
 
122 SISAM. Viewed at: https://sisam.salud.gob.sv . 
123 The list of bodies authorized to perform laboratory analysis which was included in the 
2016 TPR report by the Secretariat is no longer valid.  
124 Online information from the Ministry of Health. Viewed at: 
https://www.transparencia.gob.sv/institutions/minsal/services/1015 . 
125 Special Regulations on the Safe Handling o f Genetically Modified Organisms, Legislative Decree 
No. 78 of 1 June 2008.  WT/TPR/S/440  • El Salvador  
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  chemicals and medical devices.126 Each of these product categories has its own sanitary register, 
managed by a different unit of the DNM.127 Persons wishing to import these products must register 
as importers with the DNM, file a power of attorney form (authorizing the di stribution of the product, 
or designating a responsible qualified pharmacist -chemist or a responsible legal representative) and, 
subsequently, enter their products in the relevant sanitary register.  
3.153.   For medicines, the main sanitary registration requirement  is the Certificate of Pharmaceutical 
Product issued by country of origin, in accordance with the format recommended by the World Health 
Organization (WHO). If it is not available, importers may submit a good manufacturing practices 
(GMP) certificate or a certificate of free sale from the country of origin.128 In addition, potential 
importers must submit an analysis certificate issued by the manufacturer's quality control laboratory. 
However, the DNM also reserves the right to request additional laboratory t ests. El Salvador 
recognizes the sanitary registration certificates for cosmetic products issued by the authorities of 
other CACM countries. For medical devices, it recognizes products registered with a level 4 regulatory 
authority, as classified by the WH O. 
3.154.   In addition to being registered in the sanitary register, a permit is required to import products 
regulated by the DNM, which is processed through CIEX. A guide to this process is available to view 
online.129 
3.3.4   Competition policy and price controls  
3.3.4.1   Competi tion policy  
3.155.   The Supervisory Authority for Competition (SC) remains in charge of enforcing competition 
policy, including ( ex ante ) control of mergers, investigations into anti -competitive practices and 
administrative adjudication.130 The SC also issues advisory opinions on draft legislation, government 
procurement procedures and other public proceedings, and conducts market research with the aim 
of issuing public policy recommendations. As a general rule, the advisory opinions and pub lic policy 
recommendations are not binding131, although the SC promotes their implementation. The SC may 
act ex officio  or on the basis of a complaint/request by any economic operator with a legitimate 
interest.  
3.156.   The legal framework of El Salvador  regarding competition policy has undergone changes 
since the previous review. The Competition Law was amended  in 2017 and 2021 to ensure that it 
remained consistent with the Law on Administrative Litigation and the Law on Administrative 
Procedures, which entered int o force in 2018 and 2019, respectively.132 
3.157.   The courts in which the SC must apply for authorization to conduct a raid were clarified in 
the 2017 amendment . Since February  2018, it has been possible to challenge SC decisions before 
the administrative courts e stablished by the Law on Administrative Litigation. Judicial reviews may 
take place in the courts or chambers of administrative litigation, depending on the size of the fine 
imposed by the SC. When the courts are consulted in the first instance, their judg ement may be 
appealed before the chambers, while judgements first issued by the chambers may be appealed 
before the Administrative Litigation Division of the Supreme Court of Justice.133 The new Law on 
Administrative Litigation seeks to share out the burden  of judicial review, which previously lay 
 
126 Law on Medicines, Legislative Decree No.  1008 of 22 February 2012.  
127 DNM. Viewed at: https:/ /www.medicamentos.gob.sv/index.php/es/servicios -m/descargables . 
128 Article 43 of the Law on Medicines.  
129 The guide is available at https://www.medicamentos.gob.sv/ index.php/es/servicios -
m/descargables/uiedm -m. See also: https://www.medicamentos.gob.sv/index.php/es/secciones -m/como -
importar . 
130 The Consumer Ombudsman, an independent  body, is responsible for enforcing the Law on Consumer 
Protection. The SC is a member of the Advisory Board of the Consumer Ombudsman.  
131 The SC has exclusive powers to implement the Competition Law in all economic sectors, regardless 
of whether or not the y are regulated sectors. The interaction between the SC and certain regulatory bodies is 
prescribed in sectoral legislation, such as the Law on Telecommunications, the Civil Aviation Organization Law, 
the General Maritime Port Law, the General Electricity Law and the Special Law on Public -Private Partnerships.  
132 Legislative Decree No. 819 of 1 November 2017 (entry into force 31 January 2018) and Legislative 
Decree No.  207 of 17 November 2021.  
133 Appeals relating to violations of constitutional rights continue to be resolved in the Constitutional 
Division of the Supreme Court of Justice.  WT/TPR/S/440  • El Salvador  
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  exclusively with this Division; four years since the entry into force of the new jurisdiction, two new 
courts and one new chamber have been created to comply with the legal timeframes provided for in 
the Law. Prior  to judicial review, an appeal for reconsideration may be made to the SC Board of 
Directors in respect of its administrative decision.  
3.158.   Under the 2021 amendment , a number of procedures were modernized and the use of 
electronic and technological means of con ducting SC proceedings was enabled. The leniency 
programme was expanded, and its procedures and benefits were strengthened, with the introduction 
of immunity for the first applicant and the reduction of the fine issued to the second and 
third applicants by  up to 50 % and 30 %, respectively. For economic operators investigated for 
anti-competitive practices other than cartels (vertical restraints or abuse of a dominant position), it 
was clarified that the party under investigation may provide assurances that a ny anti -competitive 
practices will be suspended until the issuance of the file to the Board of Directors, and, in exchange, 
receive a lower fine from the SC in its final decision. In addition, several aspects related to provisional 
measures, the means of c hallenge, the limitation period for infringements, the determination of 
penalties, the verification of compliance with sanctions and obligations, and enforcement were also 
expanded or clarified.  
3.159.   In the 2021 amendment , some of the recommendations of the pee r review of Salvadoran 
competition law and policy, conducted in 2019 in cooperation with the OECD and the Inter -American 
Development Bank, were taken into account. The review had identified scope for the improvement 
of, inter alia , institutional design, re source availability, the prioritization of efforts to enforce the 
Law, the dissuasive role of remedies and penalties, the appeal periods for judicial appeals, the 
leniency programme and the thresholds for the control of mergers.134 The authorities have indi cated 
that they are developing another draft amendment . 
3.160.   While all economic operators are subject to the Competition Law, it does not cover economic 
activities that are reserved for and exclusive to the State or municipalities. El Salvador 's regulations 
do not provide for ex ante  control of public aid. As in many other jurisdictions, anti -competitive 
practices, including cartels, which are not a feature of the Salvadoran market, are excluded from 
the scope of the Law.  
3.161.   Mergers with combined total assets excee ding 50,000 annual minimum urban salaries in 
industry135 (USD  219 million) or with total income exceeding 60,000 annual minimum urban salaries 
in industry (USD  262.8  million) remain subject to prior notification. Although there is no requirement 
in the legi slation for the relevant assets or income to be located or obtained in El Salvador , the SC 
only examines a merger application if the parties are directly or indirectly present in the country, 
and when assessing whether the thresholds are exceeded, it only takes into account the assets and 
income located or obtained in the country. For regulated sectors, the SC's decision regarding a 
merger is binding for regulatory or supervisory bodies.  
3.162.   The Competition Law does not provide for or prohibit private enforceme nt. However, a 
compensation mechanism is established in the Law on Administrative Procedures under which the 
administrative authorities, including the SC, could award compensation for damages caused by the 
proven and sanctioned infringement in the respecti ve proceedings. In this regard, complainants 
could initiate an assessment of damages before the civil courts by attaching to their applications the 
SC resolution that imposes sanctions.  
3.163.   Between 2016 and 2021, the SC initiated 29 investigations, the majorit y of which were 
launched following a complaint, and penalized five unlawful practices (Table  3.17). In addition, 
16 applications for mergers, mainly from the financial, beverage and telecommunications sectors, 
were accepted for consideration. During the sa me period, the SC conducted market research on 
financial services for MSEs, the distribution and marketing of electrical energy, the barriers to the 
entry of MSEs into government procurement processes, the wholesale electricity market, the 
distribution of bovine meat, the provision of inputs for construction and the provision of new housing; 
the results led to the development of a total of 92 public policy recommendations aimed at 
strengthening competition in the markets studied, which are promoted through inter-agency work. 
The SC also issued 107 advisory opinions, with 228 recommendations aimed specifically at 
 
134 OECD -IDB Peer Reviews of Competition Law and Policy: El Salvador  (2020). Viewed at: 
https://www.oecd.org/daf/competition/El -Salvador -Peer-Reviews -of-Competition -Law-and-Policy -2020.pdf . 
135 Since 1 August 2021, the monthly minimum wage in industry has been USD 365.  WT/TPR/S/440  • El Salvador  
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  regulators. In September  2022, the SC began research on the conditions of competition in the 
production and distribution of eggs and chicken meat. N o applications under the leniency programme 
or offers of guarantees were received between 2016 and 2021. According to the peer review report, 
the fines imposed by the SC do not serve as a deterrent because they are dependent on the 
proceedings of other gov ernmental and judicial bodies.  
Table 3.17 Activities of the Supervisory Authority for Competition, 2016 -21 
 2016  2017  2018  2019  2020  2021  
Total complaints/applications  6 7 3 2 1 5 
Investigations launched  7 9 4 2 1 6 
Ex officio  1 2 1 0 0 1 
By complaint  6 7 3 2 1 5 
Cases of horizontal agreement penalized  0 1 2 1 0 0 
Cases of vertical agreement penalized  0 0 0 0 0 0 
Cases of abuse of a dominant position 
penalized  0 0 0 1 0 0 
Mergers accepted for consideration, of which  3 3 2 3 3 2 
Refused  0 0 0 0 0 0 
Unconditional authorization  2 2 2 3 2 2 
Conditional authorization  1 1 0 0 1 0 
Advisory opinions issued  22 19 18 18 16 14 
Recommendations arising from market 
research  29 14 13 17 6 13 
Recommendations arising from advisory 
opinions  67 31 41 28 33 28 
Total amount of fines and monetary 
penalties (USD)  959,496  185,760  315,697  866,164  0 49,884  
Requests for review  1 3 1 0 0 0 
Requests for reconsideration  0 0 0 2 0 0 
Requests for appeal  0 0 0 0 0 0 
Source:  Information provided by the authorities.  
3.164.   The SC has signed cooperation agreements with the competition agencies of Colombia, 
Ecuador, Mexico, Panama and Peru, as well as with international organizations that also work on 
competition policy. Collaboration agreements are aimed at strengthening the technical capacity of 
these agencies at the regional and sub -regional levels. Some of these agreements cover public 
information exchanges in cases involving violations  of the law or mergers. The SC is also a member 
of the Central American Network of Competition Authorities (RECAC), together with Honduras, 
Nicaragua, Costa Rica, Panama and the Dominican Republic (with Guatemala as an observer), and, 
in accordance with th e Central American Competition Regulations, represents El Salvador  in the 
Central American Competition Committee, together with the authority responsible for economic 
integration (Ministry of Economic Affairs), in order to encourage regional competition th rough 
cooperation mechanisms and the promotion of competition so as to contribute to the development 
of economic activities and maximize the benefits of trade liberalization.  
3.3.4.2   Price controls  
3.165.   El Salvador  continues to regulate the prices of electricity (trans mission and public use), 
certain hydrocarbons, fixed and mobile telephony services (Section 4), and the supply of water 
for public consumption. The maximum retail prices (PVMP) for pharmaceutical products sold with 
medical prescription are also regulated. The National Directorate of Medicines, in  coordination with 
the Consumer Ombudsman, determines and monitors the application of PVMP. In September  2022, 
some 6,983 pharmaceutical products were subject to PVMP, compared to 5,904  products in 
September  2016. A  pharmaceutical establishment contravening  the maximum prices established for 
medicines can face a fine equivalent to 100 to 200 minimum urban salaries in the trade and services 
sector, in accordance with Articles 79 and 84 of the Law on Medicines.  
3.166.   In the event of a national emergency, the Consumer Ombudsman may also regulate the 
prices of essential goods and services. The authorities have indicated that the Consumer 
Ombudsman is granted this exceptional power on the basis of the provisions of Article  58 of the Law 
on Consumer Protection, and the Constitution of the Republic and the Law on Administrative 
Procedures must also be taken into consideration for its exercise and enforcement. This price 
regulation is based on maximum prices.  WT/TPR/S/440  • El Salvador  
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  3.3.5   State trading, state -owned enterprises, and privatization  
3.167.   Pursuant to the notifications submitted by El Salvador  to the WTO, during the period under 
review, El Salvador  did not have any state trading enterprises within the meaning of Article  XVII:4(a) 
of the GATT  1994 and paragr aph 1 of the Understanding on the Interpretation of Article  XVII. The 
most recent notification on this issue covers the period from 1  January  2020 to 
31 December  2021.136 
3.168.   The privatization process in El Salvador  was at its most dynamic in the 1990s and the 
early 2000s. The sectors that were privatized include the marketing of sugar and coffee, petroleum 
imports, banks, telecommunications and electricity distribution. At present, the State does not 
participate in the economy to any great extent, although it c ontinues to play an important role in 
sectors such as the drinking water service and the management of ports and airports, and the 
production of renewable energy through the Hydroelectric Executive Commission of the Río Lempa. 
There were no privatizations during the review period.  
3.169.   In November  2021, the Legislative Assembly approved a public -private partnership to 
modernize and expand the cargo terminal of international airport  of San Salvador, which is owned 
by the State. This was the first partnership of i ts kind to be approved, and consists of a long -term 
contract between a public company, the Executive Autonomous Ports Commission, and a private 
investor (Section 4.4.4.3).137 
3.3.6   Government procurement  
3.3.6.1   Overview  
3.170.   According to the information from El Salvador 's electronic government procurement system, 
the value of public procurement contracts reached a peak of USD  1,255  million in 2017, equivalent 
to more than 5 % of GDP. The authorities have indicated that this pea k can be partly explained by 
high levels of investment in road infrastructure works in 2017 and the implementation of important 
social development programmes. Since 2018, a downward trend has been observed in the values 
awarded through the electronic gover nment procurement system, which the authorities link to the 
use of the stock market as an alternative mechanism for government procurement.138 In 2020, this 
trend was emphasized as a result of the health emergency caused by COVID -19. The value of 
government  procurement has returned to its pre -pandemic level, reaching USD  692 million in 2021, 
equivalent to 2.48 % of GDP (Table 3.18).  
Table 3.18 Government procurement statistics by type and method, 2016 -21 
 2016  2017 2018  2019  2020  2021  
Total value of contracts awarded 
(USD  million)  1,040  1,256  821 680 453 692 
As a percentage of GDP  4.3 5.03 3.16 2.53 1.84 2.48 
By subject  (% of total)  
Goods and services (including consultancy 
services)  96.6 97.0 97.9 97.2 97.7 97.6 
Works  3.4 3.0 2.1 2.8 2.3 2.4 
By method        
Public bidding or competition  76.87  77.48  70.49  59.19  37.1 60.33  
Free contracting  8.25 8.99 13.49  25.95  31.36  11.28  
Single tendering  10.35  8.15 11.72  10.29  8.62 27.06  
Other  4.54 5.38 4.31 4.56 22.92  1.34 
Source:  Information provided by the Salvadoran authorities . 
3.171.   Collectively, competitive procurement methods, such as public bidding, open competition, 
and free contracting, accounted for more than 70 % of total government procurement during the 
 
136 WTO document G/STR/N/19/SLV of 15 Febru ary 2022.  
137 CEPA, Terminal de carga aérea inicia transición a modalidad de asocio público privado . Viewed at: 
https://www.cepa.gob.sv/terminal -de-carga -aerea -inicia-transicion -a-modalidad -de-asocio -publico -privado/ . 
138 The regulations allow the use  of El Salvador 's commodity and service exchange (BOLPROS) as an 
alternative mechanism for government procurement. BOLPROS is regulated by the Supervisory Authority for 
the Financial System.  WT/TPR/S/440  • El Salvador  
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  review period. The vast majority of total expenditure was on goods and services, including 
consultancy services, while spending on public works remained low.  
3.3.6.2   Regulatory framework  
3.172.   The regulatory framework for government procurement in El Salvador  includ es the 
Constitution (Articles  86 and 234), the Law on Government Procurement and Contracting (LACAP)139 
and its implementing Regulations (RELACAP)140 and, since 2021, the Simplified Law on Procurement 
for Municipal Works.141 The regulatory framework is comple mented by the government procurement 
provisions in El Salvador 's trade agreements. El Salvador  is not a signatory to the WTO Agreement 
on Government Procurement and does participate as an observer in the Committee on Government 
Procurement.  
3.173.   LACAP applies t o central government agencies and local authorities, as well as state -owned 
enterprises, hospitals and autonomous institutions. Certain contracts are excluded from the scope 
of LACAP, including procurement and contracts financed by agreements or treaties w ith other States 
or international bodies, agreements concluded between state institutions, banking and financial 
services other than insurance, operations to place securities on the international market, public 
distribution services for electricity and dri nking water, and construction work carried out by municipal 
councils.142 
3.174.   LACAP does not distinguish between Salvadoran and foreign suppliers in their participation 
in public procurement. However, if there is no difference between two bids in the price and 
compliance with other conditions, preference will be given to the Salvadoran bid.143 This provision 
does not apply to the suppliers to whom El Salvador  gives national treatment under trade 
agreements. According to the data provided by the authorities, the sh are of foreign suppliers in the 
total amounts awarded in the period 2016 -21 fluctuated between 4.7 % and 16.6 %, and rose to 10 % 
in 2021. For the total number of suppliers awarded, the share of foreign suppliers varied between 
1.8% and 3.3 % over the same per iod, and accounted for 2.0 % in 2021.  
3.175.   In 2019, LACAP was amended  to increase from 12 % to 25% the minimum percentage of the 
annual budget that each government entity must give over to the procurement and contracting of 
goods and services from domestic micro and small enterprises. The amendment  also included the 
introduction of the requirement that at least 10 % of each public entity's budget for the procurement 
and contracting of goods and services  be given over to companies that are wholly or majority 
female -owned or that have legal representation of women.144 RELACAP was also amended in 2019 
to clarify that the term "newspapers in national circulation", for the purposes of publishing the call 
for bids and the results of procurement procedures, includes both printed and digital media. The 
amendment  also allowed for the use of email in the submission of bids or quotations when free 
contracting and single tendering are used.145 
3.176.   From an operational standpoint, government procurement in El Salvador  is decentralized. 
Each public entity carries out its pro curement processes through its own Institutional Procurement 
and Contracting Unit (UACI).146 The Government Procurement and Contracting Regulatory Unit 
(UNAC) in the Ministry of Finance is the national governing body in El Salvador . UNAC proposes the 
annual  procurement and contracting policy of public administration institutions, issues general 
guidelines, instructions and manuals related to LACAP, and monitors and advises the UACI on 
compliance with the regulations.  
3.177.   El Salvador  has an electronic government procurement system known as COMPRASAL. 
Together, the legal regulations, UNAC, the UACIs and COMPRASAL form the integrated procurement 
 
139 Legislative Decree No.   868 of 21 August 2000 and amendments th ereto.  
140 Executive Decree No. 53 of 10 April 2013 and amendments thereto.  
141 Legislative Decree No.  210 of 17 November 2021.  
142 Article  4 of Legislative Decree No.  868. 
143 Article  55 of Legislative Decree No.  868. 
144 Article 1 of Legislative Decree No. 240 of 14 February 2019.  
145 Executive Decree No.  30 of 10 August 2020.  
146 There are around 340 UACIs.  WT/TPR/S/440  • El Salvador  
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  and contracting system, which manages the administration, implementation, operation, coordination 
and monitoring of govern ment procurement.147 
3.178.   The UACIs must publish their annual programmes and their LACAP -regulated contracting 
and procurement processes (all forms and phases) in COMPRASAL. The system also includes the 
Register of Suppliers in which any Salvadoran or foreign pe rson interested in participating as a bidder 
may register.148 The COMPRASAL public portal can be used to search for contracting and 
procurement processes, regulations and statistics.149 It should be noted that the system is currently 
not authorized to receiv e the submission of online offers or electronic quotations.  
3.179.   It is only necessary to register in COMPRASAL to participate in public bidding or open 
tendering procedures. Natural persons may register with their national identity card (DUI) if they 
are Salvad orans, or with their passport if they are foreign suppliers. Salvadoran legal persons must 
submit their tax identification number (NIT), while foreign companies need to submit the letter of 
appointment and the passport or DUI of their legal representative.  
3.180.   Under LACAP, government procurement methods for goods, services and works include 
public bidding, open tendering procedures, free contracting and single tendering. Public bidding 
applies to the procurement of works, goods and services, while open tenderin g applies only to 
consultancy services.150 In both cases, a public and open invitation to tender is issued and all 
interested suppliers are able to participate.  
3.181.   Free contracting is the method used by government agencies to meet their regular needs for 
small  amounts of works, goods or services. A limited number of suppliers are invited to participate, 
but there must be at least three in order to ensure competitive terms. The suppliers are invited or 
selected from an information database or register.  
3.182.   In single  tendering, suppliers are selected directly; this occurs only under the circumstances 
expressly defined in LACAP. These include the following circumstances: where the subject matter of 
the procurement relates to patents, copyright, artistic or highly speci alized services; where a state 
of emergency, disaster, war or serious disturbance of public order has been declared; where a 
company is the sole provider of goods or services; where trust and confidentiality are relevant 
elements in the selection of servic e professionals; for purchases of supplies, machinery or equipment 
for use in scientific research or technological development; for purchases of weapons and equipment 
to combat crime; or where a public bidding process or competition has been declared void for the 
second time. The contracting agency must issue a well -reasoned decision in order to be able to 
award a contract directly.151 
3.183.   With the exception of single tendering, the method to be followed depends on the subject of 
the procurement, the threshold a nd the type of contracting entity, as summarized in Table  3.19. It 
should be noted that LACAP does not establish any limits on amounts for single tendering. The free 
contracting method may be suspended if the value of the goods is below 10 % of the establis hed 
threshold. In such cases, the goods may be purchased directly in commercial establishments, but 
the purchase must not be recurrent or occur more than once per quarter.152 
 
147 Article  10 bis of Legislative Decree No.  868. 
148 There are currently around 16,000 registered suppliers.  
149 COMPRASAL website. Viewed at: https://www.comprasal.gob.sv . 
150 Article  39 of Legislative Decree No.  868. 
151 Articles 71 and 72 of Legislative Decree No.  868. The grounds for the procurement of medicines to 
supply  the public health system have been declared unconstitutional.  
152 Article  39 of Legislative Decree No.  868. WT/TPR/S/440  • El Salvador  
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  Table 3.19 Government procurement m ethods by threshold and procuring entity, 2022  
Method  Threshold  
Public entities except 
municipalities  Municipalities  
SMSCa USD SMSC  USD 
Public bidding or open tendering   > 240  ≤ 87,600  > 160  > 58,400  
Free contracting  ≤ 240  ≤ 87,600  ≤ 160  ≤ 58,400  
Non-recurrent free contracting  < 10% of 240  < 8,760  < 10% of 160  < 5,840  
Single tendering  There are no thresholds as it is only used in "exceptional" cases  
a  The threshold is expressed in minimum monthly wages in the trade and services sector (SMSC). In 
2022, the SMSC was equal to USD  365. Article  40 of Legislative Decree No.  868. 
Source:  Article 40 of Legislative Decree No.  868 and information provided by the authorities.  
3.184.   Invitations to tender and bidding conditions for public bidding and open tendering procedures 
are published on COMPRASAL, as well as in national and/or international newspapers, both printed 
and digital. Technical and economic bids are open and public, and are assessed by an evaluation 
commission within each UACI, in a ccordance with the criteria specified in the public bidding or open 
tendering conditions. According to RELACAP, these criteria must be objective, measurable or 
quantifiable and non -arbitrary.153 Following the opening of the tendering process, the procuring 
entity has a period of 60 days (extendable by 30 days) to decide on the award of public bidding or 
open tendering contracts.  
3.185.   The outcome of any procurement process must be notified to interested parties within 
two working days from the time a decision is m ade. Interested parties may make an appeal in writing 
within five working days of receipt of the notification. The time limit for ruling on appeals received 
is 10 working days from the date of their acceptance.  
3.186.   During the period under review, some exceptio n measures were approved to allow the 
suspension of LACAP provisions to address the emergency caused by COVID -19, as well as to 
expedite the construction of penitentiary centres and to combat organized crime. These measures 
were temporary and limited to th e above -mentioned situations and to the public institutions directly 
involved in them.  
3.187.   During the review period, the Law on the Creation of the National Directorate of Municipal 
Works154 and the Simplified Law on Procurement for Municipal Works were enacted155, with both 
approved in 2021. The first law created the National Directorate of Municipal Works (DOM), and 
conferred on it the responsibility for qualifying, approving, contracting and implementing investment 
projects financed by the General State Budget  in the 262 municipalities of El Salvador , as well as 
issuing rules for this purpose. These projects include infrastructure works and goods, services and 
consultancy services related to these works, aimed at incentivizing the economic, social, cultural, 
religious, sporting, housing, environmental and tourism activities of municipalities. The contracting 
and procurement carried out by the DOM are subject to the Simplified Law on Procurement for 
Municipal Works, and LACAP is therefore not applied. The Law on the Creation of the DOM requires 
at least 3 % of the current net revenue from the General State Budget to be used for municipal works 
through the DOM, with resources transferred by the Ministry of Finance.156 The Simplified Law on 
Municipal Works applies to all natural or legal persons wishing to enter into a contract with the DOM. 
Suppliers interested in participating in projects administered under this law must be registered in 
the DOM computer system157, which is independent of COMPRASAL.  
3.188.   According to data provided by the authorities, in 2021, the amount of public works awards 
granted by municipalities amounted to USD  4.8 million, representing 0.6 % of the total amount of 
awards from all public institutions and 22.1 % of the total amount of awards from municip alities.  
3.189.   El Salvador  has undertaken commitments on government procurement in a number of the 
regional trade agreements it has signed, notably the Central America - Dominican Republic - United 
States Free Trade Agreement (CAFTA -DR), the Association Agreemen t between Central America and 
 
153 Article  46 of Executive Decree No.  53. 
154 Legislative Decree No.  210 of 17 November 2021.  
155 Legislative Decree No.  215 of 23 November 2021.  
156 Article 21 of Legislative Decree No.  210. The DOM has an initial budget of USD 900 million.  
157 DOM website. Viewed at: https://sistemas.obrasmunicipales.gob.sv/procesos/publico . WT/TPR/S/440  • El Salvador  
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  the European Union, the Association Agreement between the United Kingdom and Central America, 
the Free Trade Agreement between Central America and Chile, the Free Trade Agreement between 
Colombia, El Salvador , Guatemala and Ho nduras, and the Free Trade Agreement between the 
Republic of Korea and the Republics of Central America. These agreements contain disciplines of 
varying scopes on government procurement and thresholds above which suppliers from the other 
party may particip ate in open tenders on a non -discriminatory basis. Time limits for the submission 
of tenders are usually 40 calendar days.  
3.3.7   Intellectual property rights  
3.3.7.1   Overview  
3.190.   The TRIPS Agreement entered into force in El  Salvador on 1  January  2000. El  Salvador is a 
member of the World Intellectual Property Organization (WIPO) and has signed various 
WIPO -administered agreements (Table  3.20). During the review period, El  Salvador ratified two new 
intellectual property treaties: the Treaty to Facilitate Access to Publis hed Works for Persons Who Are 
Blind, Visually Impaired, or Otherwise Print Disabled (Marrakesh Treaty) in October  2014, and the 
Treaty on Audiovisual Performances (Beijing Treaty) in October  2016, which entered into force on 
30 September  2016 and 28  April 2020, respectively. El  Salvador has made a request to the 
International Union for the Protection of New Varieties of Plants (UPOV) for assistance in applying 
legislation based on the UPOV Convention but has not signed the Convention as it uses the patent 
system.158 
Table 3.20 Intellectual property treaties signed by El  Salvador, 2022  
International treaty  Date of 
ratification/accession  
Convention Establishing the World Intellectual Property Organization (WIPO)  18 June 1979 
Copyright and related  rights   
Rome Convention for the Protection of Performers, Producers of Phonograms and 
Broadcasting Organizations  29 March  1979 
Berne Convention for the Protection of Literary and Artistic Works  18 November  1993 
Convention for the Protection of Producers of Phonograms against Unauthorized 
Duplication of their Phonograms (Phonograms Convention)  25 October  1978 
WIPO Performances and Phonograms Treaty  20 October  1998 
Treaty on Audiovisual Performances (Beijing Treaty)  10 October  2016 
WIPO Copyright Treaty (WCT)  20 October  1998 
Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually 
Impaired, or Otherwise Print Disabled (Marrakesh Treaty)  1 October  2014 
Trademarks and other distinctive signs   
Paris Convention for the Protection of Industrial Property  18 November  1993 
Trademark Law Treaty (TLT)  14 August  2008 
Patents, industrial designs and utility models   
Paris Convention for the Protection of Industrial Property  18 November  1993 
Patent Cooperation Treaty  17 May 2006 
Other   
Brussels Convention Relating to the Distribution of Programme -Carrying Signals 
Transmitted by Satellite  22 April 2008 
Nairobi Treaty on the Protection of the Olympic Symbol  14 September  1984 
Budapest Treaty on the International Recognition of the Deposit of Microorganisms for 
the Purposes of Patent Procedure  17 May 2006 
Source:  World Intellectual Property Organization (WIPO) . 
3.191.   It is not possible to analyse intellectual property rights (IPRs) in El  Salvador in detail on the 
basis of the available data. An examination of the balance of payments shows that El  Salvador po sted 
a negative balance on charges for the use of intellectual property (IP) during the review period. 
Debits for IP use peaked at USD  138 million in 2017, as did credits at USD  62 million. Since 2018 
credits have fallen significantly to have been almost z ero since 2020 when the COVID -19 pandemic 
began. In 2021, debits (and the deficit) stood at USD  112 million (Table  3.21).  
 
158 Online in formation from UPOV. Viewed at: 
https://www.upov.int/export/sites/upov/members/es/pdf/status.pdf . WT/TPR/S/440  • El Salvador  
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  Table 3.21 Charges for the use of intellectual property 2016 -22Q1  
(USD  million)  
 2016  2017  2018  2019  2020  2021  2022Q1  
Credits  56 62 8 3 1 0 0 
Debits  137 138 89 98 98 112 27 
Source:  Central Reserve Bank of El  Salvador.  
3.192.   The authorities consider that the information posted in the balance of payments does not 
fully reflect information on the use of the intellectual property system in El  Salvador because it uses 
only a small dataset collected from payment surveys carried out by international franchise contracts. 
Moreover, there is no requirement in domestic legislatio n for those contracts to be filed in the 
Intellectual Property Register. The data reflect only the payments made by franchises for use of 
international trademarks, where credits represent payments made to Salvadoran businesses to use 
trademarks abroad, and  debits represent payments made by Salvadoran businesses to use or 
franchise foreign trademarks. The information is collected using surveys and there is no up -to-date 
list of businesses.  
3.193.   The Intellectual Property Register only contains the number of licenc es applied for in a given 
period. The authorities indicated that the numbers of licence applications were as follows: 87  in 
2016; 57 in 2017; 83 in 2018; 140 in 2019; 228 in 2020; 111 in 2021; and 4 in the period from 
January to June  2022.  
3.194.   The authorities also stated that in the review period the system for registering intellectual 
property rights improved to allow people to make applications online and complete various 
formalities electronically, thus helping to streamline procedures and reduce response ti mes. 
3.195.   Additionally the authorities said that they are currently working on a National Intellectual 
Property Strategy with the assistance of WIPO; the strategy will be a public policy linking the 
institutions within the national innovation ecosystem and form ing a hub that supports IP transactions 
and management nationally, regionally and internationally.  
3.3.7.2   Institutional and legislative framework  
3.196.   Responsibility for drafting and implementing El  Salvador's IPR protection policy lies with the 
Ministry of the Economy (MINEC). The Intellectual Property Register (RPI) is the authority in charge 
of administering the IP system.159 It is one of the five main directorates within the National Registry 
Centre (CNR), a decentralized agency under MINEC with administrative  and financial autonomy.160 
The RPI is in charge of recording, depositing and registering all IPRs in El  Salvador, with the 
exception of test data and undisclosed information on chemicals. These duties are performed by the 
RPI's Intellectual Property Regist er Directorate, which in turn comprises three line departments: the 
Distinctive Signs Department, the Patents Department and the Copyright Department.  
3.197.   The regulatory framework for the protection of IPRs essentially comprises the Intellectual 
Property Law161 (LPI) of 1993, last amended in 2017, and the Law on trademarks and other 
distinctive signs162 (LMOSD) of 2002, last amended in 2013.163 The LPI governs the protection of 
copyright and related rights, and certain industrial property rights (inventions, utili ty models, 
industrial designs, industrial and trade secrets, test data and new plant varieties). The LMOSD 
governs trademarks, signs or expressions of commercial advertising, trade names, emblems, 
geographical indications and appellations of origin, and pr ohibits unfair competition in those areas.164 
El Salvador's regulatory framework for intellectual property does not stipulate any nationality or 
domicile requirement in order to qualify for IPR protection.165 
 
159 Article  104 of the Law on trademarks and other distinctive signs (LMOSD) an d Article  98(e) of the 
Intellectual Property Law (LPI).  
160 Online information from El  Salvador's National Registry Centre. Viewed online at: 
https://www.cnr.gob.sv/marco -institucional/ . 
161 Legislative Decree No.  604 of 15  July 1993.  
162 Legislative Decree No.  868 of 6  June 2002.  
163 Legislative Decree No.  358 of  2 May  2013.  
164 Article  1 of the LMOSD.  
165 Article  3 of the LMOSD and Article  11 of the LPI.  WT/TPR/S/440  • El Salvador  
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  3.198.   The provisions in the TRIPS Agreement have been incorporated into El  Salvador's legislation 
(Table 3.22). Some provisions, for example those on the protection of copyright in literary works, 
computer programs and audiovisual works, exceed the minimum protection required by the 
TRIPS  Agreement. The TRIPS Council examined El  Salvador's IPR legislation in 2000.166 El Salvador 
did not notify any new intellectual property legislation during the review period. The authorities 
indicated that an internal assessment is under way on the submission of the notif ications concerned.  
Table 3.22 Overview of El  Salvador's intellectual property legislation, 2022  
Legislation  Term  Scope  
Copyright and related rights  
Intellectual Property Law (LPI), 
Legislative Decree No. 604 of 
15 July 1993; Regulations 
implementing the Law on the 
promotion and protection of 
intellectual property, Executive 
Decree No.  35 of 
28 September  1994; 
Amendments to the Law on the 
promotion and protection of 
intellectual property, Legislative 
Decree No.  912 of 
14 December  2005 and 
Legislative Decree No.  985 of 
17 March  2006.  Protection is granted for the 
author's lifetime plus 
70 years. Computer 
programs, collective and 
audiovisual works are 
protected for 70  years as of 
the date of their disclosu re. Artistic, literary and audiovisual works and 
computer programs. The copyright holder's 
economic rights include the right to authorize or 
prohibit distribution to the public of the original or 
copies of the works, whether by sale, rental, hire, 
loan or any other manner. The LPI contains special 
provisions relating to computer programs and 
databases, audiovisual and three -dimensional 
works of art, musical compositions and newspaper 
articles. Protection is given irrespective of any 
registration formality. El Salvador does not provide 
for any exceptions in respect of national treatment 
for foreigners publishing their works in El  Salvador. 
The Law applies indiscriminately to Salvadorans and 
foreigners.  
Patents  
The LPI, Legislative Decree 
No. 604 of 15 July 1993; 
Regulations implementing the 
Law on the promotion and 
protection of intellectual 
property, Executive Decree 
No. 35 of 28  September  1994; 
Amendments to the Law on the 
promotion and protection of 
intellectual property, Legislative 
Decree No.  912 of 
14 December  2005 and 
Legislative Decree No.  985 of 
17 March  2006.  Protection gives the inventor 
or applicant exclusive rights 
within El  Salvador for a 
non-renewable term of 
20 years as of the date of 
filing the application with the 
CNR Intellectual Pr operty 
Register.  The LPI provides for the right to obtain protection 
for an invention, utility model or industrial design, 
an invention meaning any product or process 
applicable in practice to the solution of a specific 
technical problem. An invention may be patented if 
it is new, involves an inventive step and is 
susceptible of industrial application. Contractual 
licences for working a patent have legal effects 
against third parties only if they have been 
registered. The following may not be patented: 
discoveries, scientific theories and mathematical 
methods; economic plans, principles or methods for 
advertising or business, those pertaining to purely 
mental or intellectual activities or to games; 
methods for treatment of the human or animal 
body by surgery , therapy or diagnosis, except for 
products intended to put any of these methods into 
practice; and inventions whose publication or 
industrial or commercial application would be 
contrary to public order or morality.  
Industrial designs and utility models  
The same legislation as that 
for patents.  10 years as of the date of 
filing the application, 
non-renewable.  Industrial designs are protected on the basis of the 
provisions of the LPI and amendments thereto. 
Such protection does not exclude or affect 
protec tion that may be available to such designs 
under other legal provisions, in particular those 
relating to copyright.  
  There is no protection for industrial designs which 
are not considered to be new in the country, that is 
to say, merely differ in minor or secondary respects 
from other earlier designs or merely refer or apply 
to another category of products; nor is protection 
granted for designs whose disclosure would be 
contrary to public order or morality.  
Layout -designs of integrated circuits  
There is no relevant national 
legislation. The provisions in the 
TRIPS Agreement apply.    
 
166 The questions put to El  Salvador by Members and El  Salvador's replies in connection with this 
examination can be found in WTO document IP/Q/SLV/1 of 18  August  2000.  WT/TPR/S/440  • El Salvador  
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  Legislation  Term  Scope  
Distinctive signs  
Law on trademarks and other 
distinctive signs (LMOSD), 
Legislative Decree No.  868 of 
6 June 2002; Legislative Decree 
No. 913 of 14 December  2005, 
Legislative Decree No.  986 of 
17 March  2006 and Legislative 
Decree No.  358 of 2  May 2013.  The right to exclusive use of 
a trademark is granted for 
10 years and may be 
renewed indefinitely for 
successive 10 -year periods. 
The concept of geo graphical 
indications has been 
introduced, offering sui 
generis  protection 
indefinitely for protected 
products. Protection 
continues for as long as the 
special conditions for which it 
was granted persist.  Any visually perceptible proprietary, figurative or  
three -dimensional sign capable of distinguishing 
products or services. The owner of a trademark is 
entitled to oppose registration of an identical or 
similar sign, to prevent its use and to request the 
authorities to prohibit or suspend imports of 
product s that make use of such signs.  
Undisclosed information (including test data)  
The LPI defines and protects 
industrial or trade secrets and 
test data. Law on medicines: 
Legislative Decree No.  1008 of 
22 February  2012 and the 
General Regulations 
implementing the Law on 
medicines, Executive Decree 
No. 245 of 
18 December  2012.  
 Indefinitely in the case of 
industrial or trade secrets. 
Protection for test data is 
conferred by a legal 
provision that lays down the 
time-limits for such 
protection, i.e.  5 years for 
pharmaceuticals and 
10 years for agricultural 
chemicals. Undisclosed 
information is protected if it 
complies with the 
requirements of 
Article  181-A of the LPI.  Protection of commercial and industrial rights 
applies whether or not the secrets are  fixed on a 
physical medium. No registration is required. The 
submission of undisclosed information is required 
by the competent administrative authority as a 
condition for approving the marketing of 
pharmaceuticals or agricultural chemicals that use 
new c hemical substances. Criteria are laid down for 
the protection of such data against unfair 
commercial use and against disclosure. There are 
exceptions regarding disclosure when the authority 
deems it necessary to protect the public or when 
measures have bee n taken to ensure that the data 
are protected against unfair commercial use. If any 
undisclosed information regarding safety and 
efficacy submitted to an authority in order to obtain 
marketing approval is disclosed by the said 
authority, such information w ill continue to be 
protected against any unfair commercial use.  
New plant varieties  
Intellectual Property Law, 
Legislative Decree No.  604 of 
15 July 1993; Regulations 
implementing the Law on the 
promotion and protection of 
intellectual property, Executive 
Decree No.  35 of 
28 September  1994; 
amendments to the Law on the 
promotion and protection of 
intellectual property, Legislative 
Decree No.  912 of 
14 December  2005 and 
Legislative Decree No.  985 of 
17 March  2006.  20 years, protected by a 
patent.  In the special case of new plant varieties, the 
criteria of an inventive step and being susceptible 
of industrial application must be met.  
Source:  WTO Secretariat, based on information provided by the authorities.  
3.199.   In 2010, El  Salvador notified the WTO that  the Trade Policy Directorate at MINEC was its 
intellectual property contact point pursuant to Article  69 of the TRIPS Agreement.167 In 2016 
El Salvador provided information regarding the list of issues on geographical indications under 
Article  24.2 of the TRIPS Agreement.168 
3.200.   The LPI establishes the right to obtain protection for an invention, utility model or industrial 
design. Acquisition of the right requires registration with the RPI. The term of protection for industrial 
designs and utility models is a n on-renewable period of 10  years calculated from the date of filing 
the application. Patents enjoy a non -renewable term of protection of 20  years calculated from the 
date of filing the application, which may be extended in the event of delays attributable t o the 
authorities. El  Salvador's legislation applies a system of national exhaustion for patents, the right 
becoming exhausted after the patented product has been "legally placed on the market for the 
 
167 WTO document IP/N/3/Rev.11/Add.4 of 18  August  2010.  
168 WTO document IP/C/W/117/Add.34 of 9  December  2016.  WT/TPR/S/440  • El Salvador  
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  first time on the national territory".169 New plant vari eties may only be protected by patents. To 
protect a new plant variety, it must be shown that it is susceptible of industrial application and 
involves an inventive step.170 
3.201.   El Salvador does not have any special domestic legislation on the protection of layo ut designs 
of integrated circuits as the country directly applies the provisions in Section  6, Article  35 of the 
TRIPS  Agreement.  
3.202.   Copyright enshrined in the LPI protects all literary, artistic and scientific works irrespective 
of their means or form of exp ression, provided that they meet the requirement of originality 
established in the Law.171 El Salvador recognizes the principle of copyright protection without 
requiring registration. The protection afforded to the copyright owner includes moral and economi c 
rights, dealt with separately in the LPI, and continues for 70  years following the author's death.  
3.203.   The main change to the regime for protection of intellectual property rights (IPRs) during 
the review period was the amendment to the LPI in 2017.172 The am endment allows holders of 
copyright and related rights to manage the use of their works.  
3.204.   The LPI gives the holder of copyright covered by the Law the right "to import or export, or 
authorize the import or export of copies of his lawfully manufactured works , and the right to prevent 
the import or export of unlawfully manufactured copies"173; similar rights are regulated in the LPI 
for holders of industrial rights (Articles  115 and  128).  
3.205.   El Salvador allows the granting of compulsory licences solely in order to supply the domestic 
market. Compulsory licensing to work a patent may be granted for "declared reasons of emergency 
or national security and for as long as these persist", provided that this is necessary to satisfy the 
population's basic needs. Th e licence must be granted by the competent jurisdiction, and specify the 
term and scope of the measure, as well as the remuneration payable to the patent owner.174 
Until 2022, El  Salvador had not issued any compulsory licence. In September  2006, El  Salvador  
accepted the amendment in the Decision on the implementation of paragraph  6 of the 
Doha Declaration on the TRIPS Agreement and Public Health as well as the protocol amending the 
TRIPS  Agreement. The protocol accords facilities to countries which do not ha ve the capacity to 
manufacture pharmaceuticals, allowing them to import patented medicines under compulsory 
licences. On 17  June 2022, the exceptional circumstances of the COVID -19 pandemic led El  Salvador 
to adopt the Ministerial Decision on the TRIPS Agr eement for the production and supply of COVID -19 
vaccines.  
3.206.   The LMOSD sets out the procedure for the protection of trademarks and other distinctive 
signs. It provides for a specific protection procedure for geographical indications (GIs) in addition to 
their existing status, which included them under the protection provided for trademarks. IPR owners 
may choose under which of the two mechanisms they seek protection for their IPRs. As to the term, 
the LMOSD protects rights arising from geographical indication s and appellations of origin 
indefinitely, for as long as the situation which gave rise to the protection persists. Protection for the 
exclusive use of trademarks is for an indefinitely renewable term of 10 years. Owing to the value 
added that appellations  of origin generate for the economy, a basic guide was drawn up in 2018 for 
SMEs interested in developing a collective mark, geographical indication or appellation of origin for 
exports to the European Union175, along with a handbook for developing distinct ive signs related to 
a place of origin for SMEs.176 On 23  June 2022 the Association Council of the European  Union -Central 
America Association Agreement approved the inclusion of 10 new geographical indications under the 
protection afforded by the agreement,  specifically the following appellations of origin: Alotepec, 
 
169 Article  116(d) of the LPI.  
170 Article  111 of the LPI. Article  114 of the LPI states that "[a]n invention shall be considered to involve 
an inventive step if, for a person having ordinary skill in the technical field concerned, the invention would not 
have been obvious or cou ld not obviously have been derived from the relevant prior art".  
171 Article  12 of the LPI.  
172 Legislative Decree No.  611 of 15  February  2017.  
173 Article  7(e) of the LPI.  
174 Articles  133 and 134 of the LPI.  
175 Information from MINEC. Viewed online at: http://infotrade.minec.gob.sv/wp -content/uploads/Guia -
b%C3  per centA1sica -para-Pymes.1.pdf . 
176 Information from MINEC. Viewed online at: 
http://infotrade.minec. gob.sv/wp -content/uploads/Manual -de-signos -distintivos.1.pdf -. WT/TPR/S/440  • El Salvador  
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  Bálsamo -Quezaltepec, Chichontepec, Tecapa -Chinameca and Cacahuatique (all types of coffee); and 
Chaparro, Camarón Bahía de Jiquilisco (a shrimp), Jocote  Barón Rojo San Lorenzo (a fruit), 
Loroco  San Lorenzo (a vegetable); and the geographical indication Pupusa de Arroz de Olocuilta (a 
flatbread).177 Previously Apaneca -Ilamatepec and Bálsamo de El  Salvador were the only recognized 
appellations of origin.  
3.207.   Administrative proceedings and appeals are go verned by the Law on administrative 
procedures (LPA) of 13  February  2019 and, where appropriate and consistent with this law, by the 
Law on the submission, examination and registration or filing of instruments in the registers of real 
estate and mortgages,  corporate property, commerce and intellectual property (LPU) of 2004. Before 
the entry into force of the LPA, administrative appeals against registration comments or decisions 
to refuse a registration were governed by the LPU. Since its entry into effect the appeals available 
are as laid down in the LPA (reconsideration, appeal for review and extraordinary review). Pursuant 
to the LPU, the RPI's Intellectual Property Registry Directorate has the authority to decide on 
requests for reconsideration and appea ls for review or extraordinary review.  
3.208.   In accordance with the information supplied by the authorities, the average time taken for 
registration is two to four months for trademarks and other distinctive signs, four to six  months for 
industrial designs, and two to three  years for patents/utility models. These averages depend on 
whether objections or administrative actions are brought; if so, the time required can vary.  
3.209.   Table  3.23 provides information on applications for patents, industrial designs and 
tradema rks for the period 2017 -21, and on those granted.  
Table 3.23 Applications and registrations of trademarks, utility models and industrial 
designs, patents and the number of patents granted, 2017 -21 
 2017  2018  2019 2020  2021  
Applications for distinctive signs   
Emblem  38 40 34 32 39 
Advertising sign or slogan  253 198 285 311 219 
Trademark  7,245  7,247  8,121  6,826  8,159  
Trade name  893 904 1,053  773 1131 
Total 8,429  8,389  9,493  7,942  9,548  
Applications for industrial designs, utility models and patents for inventions  
Industrial designs  49 45 40 34 27 
Utility models  15 3 2 4 0 
Utility models via PCT  0 1 3 0 0 
Patents for inventions  2 6 3 23 16 
Patents for inventions via PCT  167 138 148 123 115 
Total applications (industrial designs, 
utility models and patents for inventions)  233 193 196 184 158 
Source:  National Registry Centre, Intellectual Property Register of El  Salvador, statistical data.  
3.210.   The authorities indicated that during the review period the Salvadoran authorities have made 
the following progress in improving IPR protection:  
• introduction of the online "Intellectual Property Agents" platform pursuant to Legislative 
Decree No.  856 containing the Law on administrative  procedures. The platform can be 
used to file and manage applications for distinctive signs electronically and to easily store 
and search for information on the procedures for registering applications for various 
IP assets.  
• automated novelty searches for t rademarks. The purpose of this service is to provide users 
with an always -on, 100 % electronic method of checking for possible similarities with 
previous applications or registrations.  
 
177 See the Official Journal of the European Union of 23  June 2022.  WT/TPR/S/440  • El Salvador  
- 92 - 
  • introduction of the "Online payment link" system that generates an elect ronic link between 
a filing fee payment and the associated filing number and forwards it to the applicant. The 
link system automates 100 % of the procedure for registering distinctive signs, which is 
the principal IPR service.  
• express deposit of copyrighted  works. The aim is to contribute to the development of 
creative industries in El  Salvador by simplifying the administrative process. The time 
required to deposit an author's works averages one hour. The objective of this initiative is 
to ensure that perfor mers can deposit their works as a means of proving their rights.  
• express industrial property services, to make the use of the intellectual property system 
viable for the country's various productive sectors. The simplification of administrative 
steps has r esulted in a response time of eight working hours for the following services: 
(a) requests for distinctive signs, trademark renewal applications; (b)  applications for the 
payment of fees to maintain a patent right; (c)  publications of rulings on distinctiv e signs; 
and (d)  proof of payment of registration fees for distinctive signs.  
• creation of a network of Technology and Innovation Support Centres (CATI). With 
WIPO  support, the CATI -CNR was launched in November  2021 as a short -term coordinator 
of a national  CATI network.  
3.3.7.3   Enforcement  
3.211.   El Salvador has notified the WTO of the checklist of issues on enforcement, indicating the 
extent to which its national legislation satisfies the requirements of the TRIPS Agreement.178 This 
notification was made in 2000 and has not been updated subsequently. In El  Salvador, responsibility 
for oversight and compliance with intellectual property regulations is shared jointly across several 
government agencies. These include the Private Pr operty and Intellectual Property Offences Unit at 
the Public Prosecutor's Office and the National Civil Police, both of which have the authority to 
prosecute offences relating to the protection of IPRs, and the Directorate -General of Customs (DGA), 
which i s responsible for border control of goods suspected of being counterfeit.  
3.212.   The Salvadoran courts with jurisdiction in civil and commercial matters are the competent 
courts for proceedings initiated by IPR holders.179 The civil penalties laid down in the LPI are: 
immediate cessation of the unlawful activity, preventive seizure, withholding or deposit of the 
infringing goods, prohibition on importing the infringing products, materials or media, and 
compensation for dama ge. El  Salvador's legislation does not provide for the imposition of fines for 
infringing IPRs as such, but it does provide for the imposition of financial penalties as compensation 
for the damage caused by IPR infringements, on the basis of the LMOSD (Art icle 90(f) and 
Article  91); the LPI (Articles  90, 172(b) and 173); the Code of Civil and Commercial Procedure 
(Articles  240, 241 and 417); and the Code of Criminal Procedure (Article  399). Financial penalties 
are imposed when there has been a conviction ei ther in civil proceedings for infringement or in the 
determination of civil proceedings in criminal cases.  
3.213.   Pursuant to Article  5(j) of the RECAUCA, one of the powers of the Customs Service is to 
apply the appropriate control measures to protect IPRs, in ac cordance with the relevant international 
conventions. Moreover, Article  316 of the RECAUCA gives the DGA competence to apply border 
measures for the proper enforcement and protection of industrial property rights, copyright and 
related rights. The DGA may act to apply border measures: (i)  on the basis of resolutions by the 
competent authority; (ii)  ex officio  where applicable; or (iii)  following a complaint from the owner of 
the duly accredited right.  
3.214.   As indicated by the DGA as part of this Review, the DGA does not have a register of 
IPR holders . The procedure for implementing border measures to protect industrial rights in relation 
to the import or export of suspected counterfeit goods is carried out in accordance with 
 
178 WTO document G/IP/N/6/SLV/1 of 13  June 2000.  
179 Article  184 of the LPI.  WT/TPR/S/440  • El Salvador  
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  General  Administrative Provision DACG No. DGA-007-2012.180 According to the DACG, border 
measures may be implemented in the following circumstances:  
• by order of the competent judicial authority: where the judicial authority directs the 
customs service to enforce border measures, the latter must  notify the measure ordered 
to the importer's or exporter's representative, and to the person who applied for the 
measure. In this case, the border measures will apply for the period determined by the 
competent judicial authority and in accordance with the  order issued by it. Upon the expiry 
of that period or after 10 working days following implementation of the measure, where 
the customs service has not received formal notification of an extension to that period, 
the goods will be cleared and any duties, t axes and/or fines determined as would have 
been the case under the normal clearance process.  
• following an application by the owner or representative of the trademark or distinctive 
sign. Where the owner of a trademark or distinctive sign covered by the thi rd subparagraph 
of Article  316 of the RECAUCA has reasonable grounds to suspect that imports or exports 
of goods infringe his rights in a trademark or distinctive sign, he must submit an 
application; following analysis of the application, the amount of the  guarantee required 
from the applicant will be established, and the proof of the deposit of that guarantee must 
be forwarded to the Directorate -General of Treasury within a maximum of two working 
days. The application is regarded as authorized when that pr oof has been forwarded. 
Within three working days of receipt of the authorization, the owner or representative of 
the trademark or distinctive sign making the application must give notice that he has 
brought the relevant judicial proceedings or made an app lication to the competent judicial 
authority for ratification of the precautionary border measure. The judicial order will be 
enforced subject to presentation of a document proving that the competent judicial 
authority has ratified the adopted measure.  
• ex officio . Where the customs service is responsible for the physical verification of the 
good and determines that the import or export of goods may be counterfeit, the 
Comptroller of Customs must inform the declarant or his representative of the possibility 
that border measures may apply if a rightholder steps forward. The DGA publishes any 
finds on its webpage, and the owner or representative of the trademark or distinctive sign 
has a maximum period of three working days from midnight of the day following th e last 
date of publication, to give written notice to the DGA of his intention to open the relevant 
judicial proceedings. Having established the rightholder's interest in opening the relevant 
judicial proceedings at the DGA, the DGA will forward the docume ntation to the customs 
office where the good is located, inform the importer and request the guarantee where 
appropriate.  
3.215.   Between 2016 and 2022 the DGA took action in 110  cases to implement border measures 
for the proper enforcement and defence of industri al property rights, copyright and related rights 
(Table 3.24):  
Table 3.24. Border measures taken to protect IPRs, 2016 -22 
Year  Ex officio  Request  
2016 16 0 
2017 7 6 
2018 18 3 
2019 14 1 
2020 14 0 
2021 17 0 
2022 14 0 
Total 100 10 
Source:  Information provided by the authorities.  
 
180 The provision can be viewed online at the DGA portal: 
https: //sitio.aduana.gob.sv/check/plugins/download -
manager/viewer/viewer.php?dl=https://sitio.aduana.gob.sv/wp -content/uploads/download -manager -
files/DACG%20007 -2012.pdf . WT/TPR/S/440  • El Salvador  
- 94 - 
  3.216.   El Salvador's Penal Code defines intellectual property offences (infringement of copyright 
and related rights, effective technological measures, information on the management o f rights and 
rights in satellite signals), as well as offences concerning industrial property (infringement of patents, 
utility models, industrial designs, trademarks and other distinctive commercial signs, trade secrets 
and disclosure of industrial secret s). The Code provides for criminal penalties for these offences 
depending on the type and gravity of the offence committed, ranging from two to six years' 
imprisonment for intellectual property offences181, and six months to four years for industrial 
proper ty offences.182 Nonetheless, combating music and video piracy and, to a lesser extent, the 
infringement of rights in satellite signals, continues to be one of the major challenges facing the 
Salvadoran Government as far as enforcement of IPRs is concerned.  
 
181 Intellectual property offences and the penalties applicable are defined in Title  VIII, Ch apter  VII 
(Articles  226, 227, 227 -A, 227 -B and 227 -C) of El  Salvador's Penal Code.  
182 Industrial property offences and the penalties applicable are defined in Title  IX, Chapter  I 
(Articles  228-231) of El  Salvador's Penal Code.  WT/TPR/S/440  • El Salvador  
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  4  TRADE POLICIES BY SECTOR  
4.1  Agriculture, Forestry, and Fisheries  
4.1.1   Features  
4.1.  El Salvador's agricultural sector (which includes crop farming, livestock farming, forestry, 
hunting, fisheries and aquaculture) contracted significantly between 2016 and 2021, slowing an 
average of 1.1 % annually. With the exception of 2016, when the growth rate was 8.3 %, the rest of 
the period was marked by alternating years of expansion and contraction. The agricultural sector's 
share in GDP fell from 5.7 % in 201 6 to 4.9 % in 2021 (Table  4.1). Its structure saw some changes, 
with crop farming representing 49.5 % of the sector in 2021, down from 55.5 % in 2016 mainly due 
to a lower level of coffee and staple grain production. The share of livestock farming, however, 
increased considerably, rising from 30.8 % in 2016 to 36.5 % in 2021 primarily as a result of growth 
in poultry farming. Both forestry and hunting and fisheries and aquaculture posted higher 
percentages in 2021 than in 2016. As these data refer only to the ag ricultural sector, they do not 
include the value of agro -industrial production, input production or services. The agricultural sector 
is a significant source of employment. It is mostly composed of small farms, which have grown in 
number in recent decades despite a decline in the rural population.1 
4.2.  In 2021, approximately 38 % of the population lived in rural areas, and the sector employed 
425,256  people, or 15.7 % of the total working population.2 
Table 4.1 Principal indicators for the agricultural sector (maquila excluded), 2016 -21 
 2016  2017  2018  2019  2020  2021  
Share of agricultural sector in GDP (% at current prices)  5.7 5.4 5.1 5.1 5.5 4.9 
Real growth rate (%, volume indices, reference year  2014)  8.3 0.7 -2.7 1.0 -2.8 2.1 
Share in value added (% of agricultural total)        
Crop farming  55.5 50.4 50.5 50.6 50.3 49.5 
- Coffee farming and processing  5.6 5.6 5.5 4.3 4.7 5.4 
- Sugar cane farming  8.5 8.4 9.1 9.2 9.1 8.6 
- Cereal, vegetable and oilseed farming  25.2 18.7 18.0 19.9 18.9 18.0 
- Other crops  16.2 17.7 17.9 17.2 17.6 17.5 
Livestock farming  30.8 35.4 35.4 35.2 35.6 36.5 
- Cattle breeding and raw milk production  17.0 18.1 17.8 17.8 18.7 18.1 
- Pig breeding  1.1 1.3 1.3 1.2 1.2 1.2 
- Poultry breeding and egg production  11.8 15.0 15.1 15.1 14.5 16.0 
- Breeding of other animals and animal products not classified 
elsewhere  0.9 1.0 1.2 1.1 1.2 1.2 
Activities in support of crop farming and post -harvest and mixed 
farming activities  1.5 1.5 1.4 1.6 1.6 1.6 
Forestry, harvesting of wood and other forestry products, and hunting  6.3 6.6 6.8 6.7 6.8 6.6 
Fisheries and aquaculture  5.7 6.1 5.9 6.0 5.9 5.8 
Source:  WTO Secretariat, based on data from the Central Reserve Bank of El  Salvador. Viewed at: 
http://www.bcr.gob.sv/esp /. 
4.3.  Agricultural production in El  Salvador is relatively diversified. The leading products during the 
review period were staple grains (maize, sorghum, beans and rice), although their share dropped 
from 25.2 % in 2016 to 18.0 % in 2021 mainly as a result of extreme events, such as severe droughts 
and floods. Also prominent were cattle breeding and milk produ ction (18.1 % in 2021), other crops 
(17.5 % in 2021), poultry farming (16.0 % in 2021) and sugar cane farming (8.6 % in 2021), which 
contributed more to agricultural  GDP than in 2016. The coffee subsector continued its downward 
trend during the review period, falling from 5.6 % in 2016 to 5.4 % in 2021, essentially due to low 
international coffee prices and pests and diseases, such as coffee rust.  
4.4.  El Salvador is a net importer of agricultural products. The agricultural trade balance is in deficit 
and deteriorated  throughout the review period, dropping from USD -936 million in 2016 to 
 
1 Regional Research Programme on Development and the Environment  (PRISMA), El Salvador: Evolución 
de la agricultura y las estrategias de los pequeños agricultores , San Salvador, 2017. Viewed at: 
https://www.prisma.org.sv/wp -content/uploads/2020/02/El_Salvador_evolucion_de -_la_agricultu ra_y_las_estr
ategias_de_los_pequenos_agricultores.pdf . 
2 Directorate -General of Statistics and Census, Encuesta de Hogares de Propósitos Múltiples  (EHPM), 
2021. Viewed at: 
http://www.digestyc.gob.sv/phocadownload/DIVISION_DE_ESTADISTICAS_SOCIALES/Publicacion_EHPM_2021
.pdf. WT/TPR/S/440  • El Salvador  
- 96 - 
  USD -1,441  million in 2022 (up to September). The sector's share in total exports remained stable 
during the period, reaching a maximum of 24.7 % in 2020. Overall, agricultural exports  recorded a 
positive, albeit very uneven, trend between 2016 and 2021, with a decrease of -10.6% (2016) and 
increases of 9.0 % (2019) and 15.7 % (2021). As at September  2022, the sector's growth rate was 
18.0%. The main exports during the period were sugars and sugar confectionery, preparations of 
cereals, flour, starch or milk, and beverages, spirits and vinegar. Coffee, a traditional Salvadoran 
export, accounted for 17.3 % of agricultural exports in 2022 (up to September), a much higher value 
than that recor ded in previous years. The leading export destinations in 2021 were 
Guatemala  (25%), the United States  (20%) and Honduras  (15%) (Table  4.2).3 
4.5.  Agricultural products accounted for 19.2 % of total imports in 2021 and consisted primarily of 
miscellaneous edible preparations  (12.0 %), staple grains  (11.7 %) and dairy produce  (11.0 %). In 
2021, imports came mainly from the United States  (27%), Guatemala  (20%) and Nicaragua  (15%) 
(Table  4.2).4 
Table 4.2 Agricultural trade balance for El  Salvador (maquila excluded),  
2016 -22Q3  
 2016  2017  2018  2019  2020  2021  2022Q3  
Exportsa 
Value (USD  million)  915 994 965 1,052  1,023  1,184  1,055  
Contribution to total exports (%)  21.2 21.3 20.4 22.2 24.7 22.0 23.0 
Growth rate (%)  -10.6 8.7 -2.9 9.0 -2.7 15.7 18.0 
Five most important products, by HS  Chapter (% 
of agricultural total)         
17. Sugars and sugar confectionery  23.0 28.5 24.6 24.1 27.9 26.7 23.3 
19. Preparations of cereals, flour, starch 
or milk  14.9 13.7 15.1 16.2 14.3 14.5 13.8 
22. Beverages, spirits and vinegar  13.0 13.5 14.8 14.8 9.0 11.3 11.0 
09. Coffee, tea, maté and spices  12.1 12.3 11.9 10.5 10.7 10.5 17.3 
21. Miscellaneous edible preparations  6.3 6.5 6.9 7.7 9.2 8.6 7.9 
Importsa        
Value (USD  million)  1,851  1,829  2,019  2,209  2,347  2,764  2,496  
Contribution to total imports (%)  19.7 18.4 18.7 20.2 24.0 19.2 19.5 
Growth rate (%)  1.1 -1.2 10.4 9.4 6.3 17.8 22.8 
Five most important products, by HS  Chapter (% 
of agricultural total)         
21. Miscellaneous edible preparations  13.7 14.0 13.4 12.8 12.0 12.0 11.6 
10. Cereals  13.6 11.2 13.1 12.9 11.2 11.7 14.5 
04. Dairy produce; birds' eggs; natural 
honey; edible products of animal 
origin  9.9 10.0 8.9 10.4 11.4 11.0 10.5 
02. Meat and edible meat offal  6.6 7.4 7.8 9.7 8.9 9.4 7.9 
15. Animal or vegetable fats and oils; 
prepared edible fats  8.1 9.2 7.8 6.9 7.7 9.2 10.3 
Agricultural trade balance (USD  million)b -936 -835 -1,054  -1,157  -1,323  -1,580  -1,441  
a Agricultural sector values calculated using Chapters  1 to 24 of the Harmonized System.  
b Agricultural trade balance calculated using Chapters  1 to 24 of the Harmonized System.  
Source:  WTO Secretariat, based on data from the Central Reserve Bank of El  Salvador. Viewed at: 
http://www.bcr.gob.sv/esp . 
4.1.2   Agricultural policy  
4.1.2.1   Institutional framework  
4.6.  There have been no major institutional changes since the previous review undertaken in 2016. 
The Ministry of Agriculture and Livestock  (MAG) is still the agricultural sector's governing body. It is 
responsible for formulating and implementing the country's  agricultural policy in cooperation with 
various centralized and decentralized technical bodies and with the sector's autonomous institutes.5 
In 2021, the MAG  Environmental and Climate Change Office6 was created to oversee all 
environmental, agro -climati c risk and climate change management for the sustainable development 
of the agricultural sector. The MAG's Sectoral Policies and Planning Office  (OPPS) continues to be in 
 
3 Information provided by the authorities.  
4 Information provided by the authorities.  
5 Article  41 of the Rules of Proced ure of the Executive Branch.  
6 Decision No.  355 of 3  September  2021, establishing the MAG Environmental and 
Climate  Change  Office.  WT/TPR/S/440  • El Salvador  
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  charge of analysing the sector's economic performance and carrying out diagnostic stu dies of the 
domestic and international environment to provide guidance for decision -making and the formulation 
of sectoral plans and policies.  
4.7.  The MAG's organizational structure also includes the following technical offices: 
Directorate -General of Rural De velopment  (DGDR), Directorate -General of Agricultural 
Economics  (DGEA), Directorate -General of Plant Health  (DGSV), Directorate -General of Forest 
Management, Catchment Areas and Irrigation  (DGFCR), Directorate -General of Fisheries and 
Aquaculture Developme nt (CENDEPESCA) and Directorate -General of Livestock  (DGG). Other 
decentralized state agencies forming part of the agricultural sector are the Salvadoran Agricultural 
Processing Institute  (ISTA), the National Agricultural and Forestry Technology Centre  (CENTA), the 
National Agricultural College  (ENA), the Agricultural Development Bank  (BFA), the Salvadoran 
Coffee Council  (CSC) and the Salvadoran Sugar Agro -Industry Council  (CONSAA). These institutions 
provide the Ministry with technical support and advice i n their respective jurisdictions.  
4.8.  El Salvador participates in various regional and international bodies dedicated to the 
development of the agricultural sector, such as the Inter -American Institute for Cooperation on 
Agriculture  (IICA), the Central America n Agricultural Council  (CAC), the International Regional 
Organization for Plant and Animal Health  (OIRSA), the International Coffee Organization  (ICO) and 
the Food and Agriculture Organization of the United Nations (FAO).  
4.1.2.2   Legal framework  
4.9.  The laws governing  El Salvador's agricultural sector did not undergo any substantial changes 
during the period under review. Table  4.3 lists the main agricultural laws.  
Table  4.3 Main agricultural sector laws, 2022  
Instrument  Title 
Decree No.  60 of 22  August  1941 (last amended 
on 30  October  1997)  Farm Law  
Decree No.  522 of 27  November  1961 (last 
amended on 30  November  1989)  Agricultural Development Law  
Decree No.  588 of 11  December  1969 Law on Sanitary Meat Inspection  
Decree No.  153 of 11  November  1970 (last 
amended on 30  November  1989)  Irrigation and Drainage Law  
Decree No.  312 of 10  April 1973 (last amended on 
8 October  1980)  Agricultural Development Bank Law  
Decree No.  315 of 25  April 1973 Law on the Control of Pesticides, Fertilizers and Products 
for Agricultural Use  
Decree No.  302 of 26  June 1975 (last amended on 
5 March  1980)  Law Establishing the Salvadoran Agricultural Processing 
Institute  
Decree No.  221 of 9  May 1980 (last amended on 
24 Novembe r 1994)  Special Law on Agricultural Associations  
Decree No.  1013 of 8  March  1982 Law on the "Roberto Quiñonez" National Agricultural 
College  
Decree No.  219 of 25  September  1984 (last 
amended on 30  November  1989)  Livestock Promotion and Development Law  
Decree No.  353 of 19  October  1989 (last amended 
on 23  April 2015)  Law on the Salvadoran Coffee Council  
Decree No.  462 of 11  February  1993 Law Establishing the National Agricultural and Forestry 
Technology Centre  
Decree No.  844 of 14 April 1994 (last amended on 
9 August  2013)  Wildlife Conservation Law  
Decree No.  524 of 30  November  1995 (last 
amended on 5  September  2013)  Plant and Animal Health Law  
Decree No.  97 of 10  August  1998 (last amended 
on 2 May 2000)  Regulation for the Cont rol of Activities Related to Cotton 
Farming  
Decree No.  530 of 30  August  2001 (last amended 
on 30  April 2008)  Law on Seeds  
Decree No.  490 of 26  July 2001 Salvadoran Sugar Agro -Industry Production, Processing 
and Marketing Law  
Decree No.  637 of 6 December  2001 (last 
amended on 21  November  2017)  General Law on the Organization and Promotion of 
Fisheries and Aquaculture  
Decree No.  852 of 22  May 2002 Forestry Law  WT/TPR/S/440  • El Salvador  
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  Instrument  Title 
Decree No.  35 of 15  April 2009 Special Regulation Governing International Trade in 
Endangered Species of Wild Fauna and Flora  
Legislative Decree No.  206 of 9  November  2021 Law Establishing the Salvadoran Coffee Institute  
Legislative Decree No.  309 of 13  March  2022 Special Transitory Law to Combat Inflation in Commodity 
Prices  
Source:  WTO Secretariat.  
4.10.  El Salvador's agricultural policy is set out in the document entitled "National Agricultural 
Policy  2019-24" as well as in the Institutional Strategy Plan  2019-24 and the Agricultural Recovery 
Master Plan, developed based on the Sa lvadoran Five -Year Strategic Plan  2019-24.7 The general 
objective of the policy is to boost the sector's sustainable development by encouraging investment 
in the territory in order to improve living conditions for farming families, guarantee food security 
and build new value chains. This policy pay s particular attention to aspects such as climate change 
and the role of women and young people in the sector's revival.  
4.11.  At the regional level, El  Salvador participates in the Agricultural Policy for the SICA 
Region  2019-30, which replaced the Central Amer ican Agricultural Policy  2008-17 (PACA). It applies 
the Policy jointly with Costa Rica, Guatemala, Honduras, Nicaragua, Panama and Belize. This policy 
focuses on the following strategic areas: (i)  competitiveness and agribusiness; (ii)  sustainable 
agricult ure adapted to climate; (iii)  innovation and technological development; (iv)  agricultural 
health and food safety; and (v)  effective institutional coordination.8 
4.1.3   Policy instruments  
4.1.3.1   Border measures  
4.12.  Tariff protection in El  Salvador's agricultural sector is h igher than in the manufacturing sector. 
On 1  January  2022, the simple average of MFN tariffs applied to agricultural products 
(WTO  definition) was 12.4 % (12.5 % in 2015), as compared with the average tariff of 5.3 % (5.2% 
in 2015) on non -agricultural product s (petroleum excluded). Under the Special Transitory Law to 
Combat Inflation in Commodity Prices9, the tariffs applicable to 49  tariff lines comprising staple foods 
(milk, rice, beans, maize, sugar, etc.) and certain agricultural inputs (fertilizers, inse cticides) were 
reduced to zero in March  2022. These reductions will be effective until 31  March  2023. At the end of 
June 2022, the aforementioned law was also amended to reduce tariffs on beef -derived foods to 
zero.10 For agricultural products, the highest  average tariffs are on dairy produce  (26.6 %), sugars 
and sugar confectionery  (26.2 %), and animals and animal products  (25.5 %). The highest tariff rate 
(164%) is still on imports of poultry thighs and legs.11 A 40% tariff is levied on 79  tariff lines 
compr ising products such as pig meat, sausages, milk, rice, sugar, rum and ethyl alcohol, although 
tariff reductions apply to some of these lines pursuant to Legislative Decree No.  309 
(Section  3.1.3.1). El  Salvador does not apply any specific or mixed tariffs or seasonal or variable 
tariffs (Section  3.1.3.1).  
4.13.  Within the Central American Common Market  (CACM), El  Salvador accords duty -free 
treatment to the vast majority of imports from the group's member countries, except for some 
agricultural products such as ro asted and unroasted coffee and cane sugar, to which El  Salvador 
applies MFN  rates. El  Salvador also grants preferential treatment to agricultural imports from 
countries or territories with which it has free trade agreements or partial scope agreements 
(Section 3.1.3.3). The tariff reduction process for most of the sensitive agricultural products under 
the CAFTA -DR began in 2021 and will end in 2024.  
4.14.  Under its WTO commitments, El  Salvador established tariff quotas for imports of meat, milk, 
cheese, yellow ma ize, fats and oils, sugars, tobacco and tobacco products. During the period under 
 
7 At the time of writing, the Government 's Five -Year Plan  2019-24 was still awaiting final release. 
Viewed at: 
https://www.transparencia.gob.sv/system/disclaimers/files/000/001/385/original/Aclaraci%C3%B3n_Plan _de_
Gobierno_2019 -2024_ -_enero.pdf?1594326558 . 
8 Central American Agricultural Council, Política Agropecuaria de la Región SICA 2019 -30. Viewed at:  
https://www.cac.in t/sites/default/files/Politica%20Agropecuaria%20CAC.pdf . 
9 Legislative Decree No.  309 of 13  March  2022.  
10 Legislative Decree No.  433 of 28 June 2022.  
11 HS headings 0207.13.93, 0207.13.94, 0207.14.93, 0207.14.94, 1602.32.10 and 1602.32.90.  WT/TPR/S/440  • El Salvador  
- 99 - 
  review, El  Salvador opened an annual quota for cheddar cheese (HS  0406.90.20.00), with an 
in-quota tariff of 0 % and an out -of-quota rate of 40 %. The fill rates varied from ye ar to year, 
reaching a maximum of 40 % in 2021.12 The country also has tariff quotas for various agricultural 
products (dairy produce, meat, maize, rice) under certain trade agreements (Section  3.1.3.4 and 
Table  A3.1).  
4.15.  During the period under review, El  Salvador continued to use scarcity quotas to deal with 
shortages of some agricultural products caused by adverse weather events, such as droughts and 
tropical storms. For example, in 2017, a quota was opened for 25,000  tonnes of paddy rice imports 
that expire d on 31  March  2018.13 In 2019, separate quotas were opened for imports of 
50,000  tonnes of white maize and 146,000  tonnes of yellow maize for animal consumption as well 
as 62,000  tonnes for human consumption that expired on 31  December  2019 and 31  January  2020, 
respectively.14 
4.16.  As a result of the COVID -19 pandemic, various support measures were adopted for the 
agricultural sector, as described in Table  4.4. In addition to scarcity quotas, they included tariff and 
VAT exemptions, price caps on products consid ered essential and a temporary restriction on red 
bean exports (Section  3.2.3).  
Table  4.4 Main measures adopted in the agricultural sector as a result of the COVID -19 
pandemic  
Title Purpose  Term  Entity  Date  
Decision 
No. 27 Setting of price caps for the following essential 
products: beans, rice, maize, powdered milk and 
eggs.  During the 
national 
emergency  Consumer 
Ombudsman  Official 
Journal of 
19/3/2020  
Decision 
No. 501 Scarcity quota for up to 20,000  tonnes of imports of 
rice in the husk (1006.10.90.00) from any source 
outside the Central American region. In -quota tariff 
rate of 0% and out -of-quota rate of 40%.  31/12/2020  Ministries of the 
Economy, of 
Agriculture and 
Livestock, and of 
Finance  Official 
Journal of 
23/3/2020  
Decision 
No. 502 Scarcity quota for up to 180,000  tonnes of imports of 
yellow maize (1005.90.20.00) from any sou rce 
outside the Central American region. In -quota tariff 
rate of 0% and out -of-quota rate of 15%.  31/12/2020  Ministries of the 
Economy, of 
Agriculture and 
Livestock, and of 
Finance  Official 
Journal of 
23/3/2020  
Decision 
No. 503 Scarcity quota for up to 140,000  tonnes of imports of 
white maize (1005.90.30.00) from any source outside 
the Central American region. In -quota tariff rate of 
0% and out -of-quota rate of 20%.  31/12/2020  Ministries of the 
Economy, of 
Agriculture and 
Livestock, and of 
Finance  Official 
Journal of 
23/3/2020  
Decision 
No. 512 Temporary restriction on red bean exports and 
re-exports (0713.33.40.00).  31/12/2020  Ministries of the 
Economy and of 
Agriculture and 
Livestock  Official 
Journal of 
26/3/2020  
Decision 
No. 33 Amendment of Decision No.  27 of 19  March  2020 to 
set price caps for the following essential products: 
beans, rice, maize, powdered milk and eggs; and to 
include in this list of essential products certain fruits 
(banana, plantain and orange), certain vegetables 
(onion, green chilli, tomato, potato, cabbage, chayote 
and garlic) and certain fats (oil, margarine and 
butter).  During the 
national 
emergency  Consumer 
Ombudsman  Official 
Journal of 
30/3/2020  
Decree 
No. 616 Exemption for the MAG and for individual importers 
from the payment of tariffs and VAT on imports of 
white maize, black beans, white rice and parboiled 
rice and from the payment of VAT on imports of red 
beans for human consumption in order to guarantee a 
domestic supply in the context of the COVI D-19 
pandemic.  During the 
national 
emergency  Legislative 
Assembly  Official 
Journal of 
2/4/2020  
Decision 
No. 37 Amendment of Decision No.  33 of 30  March  2020 to 
modify and set caps on listing prices for specific and 
generic brands of products considered essential.  During the 
national 
emergency  Consumer 
Ombudsman  Official 
Journal of 
17/4/2020  
 
12 WTO documents G /AG/N/SLV/61 -64 and G/AG/N/SLV/82 of 11  November  2020 and 7  March  2022, 
respectively.  
13 Decision No.  1134, Official Journal of 4  September  2017.  
14 Decisions No.  177 and No.  179, Official Journal of 19  February  2019.  WT/TPR/S/440  • El Salvador  
- 100 - 
  Title Purpose  Term  Entity  Date  
Decision 
No. 39 Amendment of Decision No.  37 of 17  April 2020 to 
modify and set caps on listing prices for specific and 
generic brands of products conside red essential.  During the 
national 
emergency  Consumer 
Ombudsman  Official 
Journal of 
8/5/2020  
Source:  WTO Secretariat.  
4.17.  El Salvador reported that no export subsidies were applied to agricultural product exports 
during the period under review  (2016 -21).15 Nor did it use special safeguard provisions under the 
Agreement on Agriculture.16 
4.18.  El Salvador requires permits, authorizations and/or certificates for the import and export of 
various agricultural products for reasons of public health, sanitary and phytosanitary protection, and 
environmental protection or to fulfil international commitments (Tables  3.9 and  3.10).  
4.1.4   Domestic support  
4.19.  The most recent notification of domestic support submitted by El  Salvador under the 
Agreement on Agriculture dates back to 2021 and refers to the financial year  2015/2016. It describes 
pest and disease control measures, capacity building and technical assistance measures, and 
development programmes aimed at improving the productivity of various agricultural subse ctors.17 
These measures fall under the "green box" and the special and differential treatment (development 
programmes) provided for in the Agreement. The total amount of domestic support for the financial 
year 2015/2016 was USD  113.6  million.  
4.20.  El Salvador p rovides support to the agricultural sector through the MAG. This support is 
structured around the following major themes: food and nutritional safety; revival and sustainable 
development of coffee growing; revival and modernization of livestock farming; ex ploitation and 
sustainable development of fisheries and aquaculture; promotion of sustainable production and 
marketing of cocoa, fruits and vegetables; mitigation of and adaptation to climate change; and 
strengthening of the country's health status.18 
4.21.  With a total budget of USD  17 million, the MAG's National Economic Transformation 
Programme - Rural Adelante seeks to sustainably increase the incomes of poor and vulnerable rural 
families in the eastern part of the country and to enhance their resilience to c limate change. The 
programme will wrap up at the end of 2024 and will have benefited 8,300  families, including many 
women and young people.19 
4.22.  The MAG's Support Programme for Family Farming  (PAAF), with a total budget of 
USD 67 million, ended on 31  December  2021. The programme's objective was to improve living 
conditions for its users and to enhance the competitiveness of rural businesses and production 
chains. This activity benefited 395,000  families.20 
4.23.  With an investment of USD  65 million, the MAG also del ivers agricultural packages to supply 
staple grains to 664,402  producers, as well as coffee plants, valued at USD  5 million, to revive the 
national coffee -growing industry. In addition, it provides technical assistance for agriculture, 
fisheries and aquacu lture throughout the country in order to increase agricultural production.  
4.24.  The new Agricultural Recovery Master Plan is based on two key pillars. The Agricultural 
Transformation Plan for Food Sovereignty aims to promote agricultural production and reduce 
dependence on imports by creating a trust that provides agricultural producers with financial 
support. The Sustainable Coffee Take -Off Plan seeks to revive the coffee subsector to make it 
 
15 WTO documents G/AG/N/SVL/80 of 3  February  2022; G/AG/N/SLV/75 of 16  March  2021; 
G/AG/N/SLV/55 of 28  May 2020; G/AG/N/SLV/54 of 28  May 2020; G/AG/N/SLV/51 of 2  May 2018.  
16 WTO documents G/AG/N/SVL/81 of 15 February 2022; G/AG/N/SLV/73 of 4 February 2021; 
G/AG/N/SLV/53 of  8 May 2020; G/AG/N/SLV/53 of 8 May 2020; G/AG/N/SLV/50 of 2  May 2018.  
17 WTO document G/AG/N/SLV/79 of 18  June 2021.  
18 Ministry of Agriculture and Livestock, Sectoral Operational Plan  2021. Viewed at: 
https: //www.transparencia.gob.sv . 
19 Ministry of Agriculture, Memoria de labores , June  2020–May 2021. Viewed at: 
https://www.mag.gob.sv/wp -content/ uploads/2021/06/MEMORIA -DE-LABORES -2021-AGRICULTURA.pdf . 
20 Ministry of Agriculture, Memoria de labores , June  2020–May 2021. Viewed at: 
https://www.mag.gob.sv/wp -content/uploads/2021/06/MEMORIA -DE-LABORES -2021-AGRICULTURA.pdf . WT/TPR/S/440  • El Salvador  
- 101 - 
  profitable again. Investments of USD  635 million and USD  637.5  millio n have been earmarked for 
the implementation of these two pillars, respectively.  
4.25.  In accordance with the Rules of Procedure of the Executive Branch, one of the functions of 
the MAG is to "develop and promote credit policies to facilitate medium - and long -term financing for 
agricultural producers, especially for sectors not covered by commercial banking."21 During the 
period under review, the national financial system granted an average of USD  250 million annually 
in credit to the agricultural sector, which represents approximately 3 % of total credit granted. Most 
of the credit granted to the agricultural se ctor was for coffee, sugar cane and maize.  
4.26.  Development banking, consisting of the Agricultural Development Bank  (BFA), Mortgage Bank 
of El Salvador and Development Bank of El  Salvador  (BANDESAL), is the mechanism through which 
government support is channel led to the agricultural sector. Together, these institutions account for 
a considerable share of the credit that the national financial system grants to the sector.  
4.27.  The BFA is the principal provider of first -tier credit for agricultural production. BFA  credit is 
intended for the production of staple grains and certified seeds, vegetables, fruit trees and coffee 
and for livestock and agro -industrial production. The Mortgage Bank has a large portfolio of products 
related to the agricultural sector, and in par ticular to coffee, sugar cane, grain and vegetable 
production and agro -industry. Between 2016 and 2021, the Mortgage Bank's agricultural credit 
portfolio amounted to USD  393 million.  
4.28.  In 2021, BANDESAL offered four lines of direct financing to the agricultu ral sector (agricultural 
activities, coffee, sugar cane and agro -industry). That same year, eight credits were granted to the 
agricultural sector worth USD  8.03 million, equivalent to 4.4 % of total credit granted (Table  A3.2). 
The Economic Development Fund  (FDE), administered by BANDESAL, offered five lines of credit 
related to the agricultural sector in 2021: promotion of agricultural activities, investment in coffee 
plantations, coffee production costs, refinancing of the coffee growing industry (for cred it granted 
with FDE  resources) and refinancing of credits for coffee growing. That same year, 17  credits were 
granted to the agricultural sector through the FDE; these credits amounted to USD  2.81 million, 
equivalent to 21 % of the total. BANDESAL also offe red eight lines of second -tier financing to the 
agricultural sector, mostly for the coffee subsector. In 2021, 339  second -tier credits were granted 
to the agricultural sector worth USD  10.3 million, equivalent to 8 % of the total.22 
4.29.  The BANDESAL Salvadoran Guarantee Fund  (FSG) provides guarantees in support of financial 
operations to facilitate access to credit for MSMEs in productive sectors. In 2021, the agricultural 
sector accounted for just 0.4 % of the guarantees granted by the FSG, for a guaranteed amou nt of 
USD 0.24 million. That same year, the Agricultural Guarantee Programme  (PROGARA), administered 
by BANDESAL, registered 10,076  guarantees for a guaranteed amount of USD  21.1 million.23 
4.30.  In August  2015, the Agricultural Banking Programme was launched to  boost the development 
of agricultural MSMEs through financing and guarantee programmes for agricultural activities. By 
December  2021, 6,371  first- and second -tier credits totalling USD  234.03  million had been granted 
under this programme and USD  207.3  million in credit had been guaranteed through PROGARA.24 
4.31.  According to the MAG, the fact that the agricultural sector receives such a low level of the 
total credit granted by the Salvadoran financial system is reflective of the need to modify the legal 
and institutional framework in order for El  Salvador's financial system to promote a new agricultural 
development model that prioritizes economic and social development. The importance of 
strengthening development banking to that end is also recognized.25 In this regard, the new 
 
21 Article  41 of the Rules of Procedure of the Execu tive Branch.  
22 BANDESAL, Memoria de Labores , 2021. Viewed at: 
https://www.bandesal.gob.sv/wp -content/uploads/2022/09/VF -MEMORIA -BAND ESAL-2021-v2-15-JUN.pdf . 
23 BANDESAL, Memoria de Labores , 2021. Viewed at: https://www.bandesal.gob.sv/wp -
content/uploads/2022/09/VF -MEMORIA -BANDESAL -2021-v2-15-JUN.pdf , and information provided by the 
authorities.  
24 BANDESAL, Memoria de Labores , 2021. Viewed at: 
https://www.bandesal.g ob.sv/wp -content/uploads/2022/09/VF -MEMORIA -BANDESAL -2021-v2-15-JUN.pdf . 
25 Ministry of Agriculture and Livestock, Sectoral Operational Plan  2022. Viewed at: 
https://www.transparencia.gob.sv/system/documents/documents/000/487/788/original/POS_2022.pdf?16515
28117 . WT/TPR/S/440  • El Salvador  
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  Agricultural Recovery Master Plan provides for the re -engineering of state banking as a strategic axis 
to serve the agricultural sector with special credit lines and rates.26 
4.1.5   Fisheries and aquaculture  
4.1.5.1   Features  
4.32.  El Salvador has an exclusi ve economic zone covering 88,026  km2 over 332  km of 
Pacific  coastline  and an area of 528  km2 of surface water.27 El Salvador's fisheries sector has a very 
small share in domestic GDP (1 % in 2021), but is important in terms of job creation, food security 
for coastal populations and marine resource management. The sector is essentially characterized by 
artisanal fishing, primarily for shrimp, shark and demersal fish. In 2021, the fisheries sector 
employed 29,219  people, most of whom were artisanal fishers. Th e aquaculture subsector employed 
2,491  people.28 
4.33.  The contribution that fisheries and aquaculture made to agricultural GDP remained stable 
during the review period and stood at 5.8 % in 2021. El  Salvador's fisheries trade balance was 
positive throughout the period under review. The leading fishery exports are tuna loin and canned 
tuna, with a value close to USD  90 million. Tilapia, dorado, eel and corvina are also exported. 
Imports include yellowfin and skipjack tuna, which are destined for the canning indust ry. 
4.1.5.2   Legal and institutional framework  
4.34.  The fisheries sector is governed by the General Law on the Organization and Promotion of 
Fisheries and Aquaculture and its implementing regulations.29 The purpose of the Law is to regulate 
the organization and promotio n of fishery and aquaculture activities, ensuring the conservation and 
sustainable development of hydrobiological resources.30 In 2017, the Law was amended to require 
a special fishing licence to allow nationals or foreigners who are authorized to fish to harvest highly 
migratory species using purse seine gear and to set relevant fishing fees.31 The National Fisheries 
and Aquaculture Policy  2015-30, the 2012  Environmental Strategy for Adaptation to and Mitigation 
of Climate Change in the Agricultural, Fores try and Aquaculture Sector, the National Environment 
Policy, the Strategic Aquaculture Plan  2015-25, and the Fisheries and Aquaculture Integration 
Policy  2015-25 of the Central America Fisheries and Aquaculture Organization  (OSPESCA) round off 
the legal fr amework for the fisheries sector.  
4.35.  Under the Law, the MAG is responsible for formulating fisheries and aquaculture policy and 
planning fisheries and aquaculture organization and promotion. Pursuant to the Law, CENDEPESCA 
was created as a directorate -general  of the MAG, the functions of which include adopting measures 
to preserve fisheries resources, regulating fishery and aquaculture activities, conducting research in 
this area, providing advice and technical assistance to industry players, granting and rene wing the 
required licences and authorizations, and establishing closed seasons for certain hydrobiological 
species. The Law also establishes the National Council for Fisheries and Aquaculture  (CONAPESCA), 
as an advisory and consultative body of the compete nt authority, and the National Scientific Advisory 
Committee on Fisheries and Aquaculture  (CCCNPESCA), as an advisory body of CENDEPESCA 
providing scientific and technical support.32 
4.36.  El Salvador has not ratified the 1982  United Nations Convention on the Law of the Sea. In 
2014, it joined the International Commission for the Conservation of Atlantic Tunas  (ICCAT). The 
country adopted the FAO Code of Conduct for Responsible Fisheries, but is not a party to the 
Agreement on Port State Measures to Prevent, De ter and Eliminate Illegal, Unreported and 
Unregulated Fishing (IUU  fishing). It is also a member of the Central America Fisheries and 
 
26 MAG, Agricultural Recovery Master Plan. Viewed at: 
https://www.transparencia.gob.sv/system/documents/documents/000/417/721/original/Plan_Maestro_Rescate
_Agropecuario_2020 -2024_PP.pdf?1614727806 . 
27 FAO, Fishery and Aquacul ture Country Profiles  – El Salvador. Viewed at: 
https://www.fao.org/fishery/en/facp/slv?lang=es . 
28 Information provided by the authorities.  
29 Decree No.  637 of 6  December  2001 (last amended in  2017). The regulations implementing the Law 
were published by way of Decree No.  38 of 26  April 2007.  
30 Article  1 of the General Law on the Organization and Promotion of Fisheries and Aquaculture.  
31 Decree No.  810 of 20  November 2017.  
32 Articles  7 to 12 of the General Law on the Organization and Promotion of Fisheries and Aquaculture.  WT/TPR/S/440  • El Salvador  
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  Aquaculture Organization  (OSPESCA), the Commission on Small -Scale, Artisanal Fisheries and 
Aquaculture for Latin America a nd the Caribbean  (COPPESAALC), the Inter -American Tropical Tuna 
Commission  (IATTC) and the Latin American Organization for Fisheries Development  (OLDEPESCA).  
4.37.  El Salvador has a National Fisheries and Aquaculture Register, created under the General Law 
on Fisheries and Aquaculture, containing records of authorizations, licenses and renewals granted 
for fishery and aquaculture activities as well as information on skippers or captains, fishing vessels, 
shipyards and landing centres.33 
4.38.  Authorization must be obta ined from CENDEPESCA to carry out fishery or aquaculture 
activities in El  Salvador. Issuance of such authorization will depend on the state and level of 
exploitation of the fishery resources in question. There are no restrictions for foreign natural or leg al 
persons. These authorizations are valid for one year for wholesale marketing and exportation; two 
years for individual artisanal harvesting; and five years for processing, legally associated artisanal 
harvesting, industrial harvesting and harvesting of highly migratory species using purse seine gear. 
For aquaculture, authorizations are usually valid for five years, although they may be indefinite if 
the activities are carried out in privately owned areas.34 
4.39.  In addition to the CENDEPESCA authorization, on e licence per physically present vessel in 
proper operating condition is also required for the harvesting phase. This licence is valid for one year 
and can be extended for equal periods. These licences may be transferable with the vessel.35 
4.2  Mining and ener gy 
4.2.1   Mining  
4.40.  Mining and quarrying accounts for around 0.27% of El Salvador's GDP36, and is concentrated 
in non -metallic mining (quarrying). There are 51 licensed quarries, producing limestone, rough cut 
stone, crushed stone, sand, selected fill, chips, tierra  blanca  (pozzolana), scoria, granular material 
and gravels, 35 of them for sale and 16 for self -consumption only.37 
4.41.  Metal mining was banned in El Salvador for environmental reasons by the Law prohibiting 
metal mining.38 The Law prohibits metal mining in th e soil and subsoil. The ban on metal mining 
includes exploration, extraction, exploitation and processing, whether opencast or underground. It 
also prohibits the use of toxic chemicals, such as cyanide and mercury. The Law provides that no 
institution, reg ulation, administrative act or resolution may authorize the exploration, exploitation, 
extraction or processing of metallic minerals in El Salvador, or grant licences, permits, contracts or 
concessions for such purposes. All pending proceedings for obtaini ng metal mining licences or 
concessions were terminated upon the entry into force of the Law.  
4.42.  The Directorate of Hydrocarbons and Mining at the Ministry of Economic Affairs (MINEC) 
regulates the exploration, exploitation, processing and marketing of non -renewable natural 
resources (metallic and non -metallic minerals). The Directorate is also responsible for supervising 
the environmental aspects of authorized projects. In addition, it checks that the exploitation is 
carried out without risk to the health an d safety of workers, promotes rational use of the resource 
and the progressive restoration or rehabilitation of already exploited areas, and ensures that the 
exploitation of resources is not carried out illegally.39 
 
33 Chapter  III, National Fisheries and Aquaculture Register, General Law on the Organization and 
Promotion of Fisheries and Aquaculture.  
34 Chapter  I, Authori zations, of the General Law on the Organization and Promotion of Fisheries and 
Aquaculture.  
35 Article  58 of the General Law on the Organization and Promotion of Fisheries and Aquaculture.  
36 Online information from the Central Reserve Bank of El Salvador. V iewed at: 
https://www.bcr.gob.sv/bcrsite/?cdr=160&lang=es . 
37 Information from the Directorate of Hydrocarbons and Mining. Viewed at: 
https://www.edrhym.gob.sv/drhm/estadisticas.aspx?ui d=12 . 
38 Decree No. 639 of 29 March 2017.  
39 Directorate of Hydrocarbons and Mining, Marco Legal . Viewed at: 
https://www.edrhym.gob.sv/drhm/marco_legal.aspx . WT/TPR/S/440  • El Salvador  
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  4.43.  Mining activity is regulated by the Mini ng Law40 and amendments thereto.41 The purpose of 
the Law is to regulate aspects related to the exploration, exploitation, processing and marketing of 
non-renewable natural resources found in the soil and subsoil of the territory of El  Salvador, except 
for hydrocarbons in liquid or gaseous state, which are regulated by specific laws, the extraction of 
stone material from rivers, beaches and lakes, which is regulated in accordance with existing 
environmental regulations and the extraction of salt through mar ine water evaporation processes, 
which is governed by the Regulations for the establishment of salt marshes and mangrove forest 
aquaculture operations.  
4.44.  All mineral deposits found in the subsoil of the territory of El Salvador and those found in its 
contine ntal shelf and insular territory are property of the State, and its ownership thereof is 
inalienable and imprescriptible. For the purposes of this Law, mineral deposits are classified as 
metallic (mines) and non -metallic (quarries). As noted above, current ly only quarrying is permitted. 
For the exploration and exploitation of quarries, the State grants licences or concessions through 
the Directorate of Hydrocarbons and Mining at MINEC, subject to compliance with the provisions of 
the Mining Law and its impl ementing Regulations.  
4.45.  The Ministry of Economic Affairs is empowered to: (a) define policies, plans, programmes and 
research projects for the promotion and development of mining; (b) grant concessions for the 
exploitation of mining resources and sign the re spective contracts with holders; (c) issue provisions 
and instructions related to mining activities, in accordance with the provisions of the Law, and put 
out to tender special areas in which deposits with researched economic potential are located. The 
Directorate is in charge of: (a) drawing up policies for the promotion and development of mining 
activities with respect to technical, economic, industrial and trade aspects, and must first submit 
them to the Ministry for consideration; (b) taking the necessa ry measures for beneficiaries to carry 
out the exploration and exploitation of mines and quarries; (c) processing and deciding on 
applications for mining licences and concessions; and (d) keeping a register of licences and 
concessions granted.  
4.2.2   Energy  
4.46.  Petroleum products dominate El Salvador's energy resource matrix (primary and secondary), 
accounting for approximately 67% of total energy supply in 2021, with bagasse accounting for 10%, 
renewables (wind, solar and geothermal) for 7%, other biomass for 7%, hyd roelectric sources for 
5%, and fuel wood for 4%.42 During the review period, renewable electricity generation has been 
boosted, with a marked increase in the installed capacity of solar photovoltaic power, and the 
introduction of the first wind power plant. However, most of the country's energy needs cont inue to 
be supplied by fossil fuels. El Salvador has no discovered oil resources and remains an importer of 
oil derivatives.  
4.47.  Since November 2022, the Directorate -General of Energy, Hydrocarbons and Mining, an 
autonomous entity, has been responsible for for mulating and implementing domestic energy and 
mining policy, and for authorizing, regulating and supervising hydrocarbon and mining activities.43 
The new institution carries out the functions previously exercised by the National Energy Council 
(CNE) and by  the Ministry of Economic Affairs (MINEC), through its Directorate of Hydrocarbons and 
Mining, as regards the energy (electricity and hydrocarbons) and mining sectors.44 The regulation, 
supervision and control of the electricity sub -sector continue to fall  under the responsibility of the 
General Supervisory Authority for Electricity and Telecommunications (SIGET). The institutional 
reform aims to reduce the dispersion of responsibilities in energy matters among various state 
entities.  
4.48.  During the review peri od, El Salvador developed a new strategy, the National Energy Policy 
2020-50, which sets out a long -term vision and establishes guidelines towards achieving an efficient 
 
40 Decree No. 544 of 14 December 1995 . 
41 Legislative Decree No. 475 of 11 July 2001.  
42 International Energy Agency, IEA World Energy Balances database (2022).  
43 Legislative Decree No.  190 of 8 November 2021.  
44 From 2007 to 2022, the National Energy Council was the governing and regulatory body for the 
energy sector (electricity and hydrocarbons) and was responsible for developing energy policy. The regulation, 
supervision and control of the hydrocarbons sub -sector fell under the responsibility of the Directorate of 
Hydrocarbons a nd Mining, a unit of MINEC. MINEC was also in charge of administering certain subsidies/the 
LPG subsidy for residential consumption.  WT/TPR/S/440  • El Salvador  
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  and competitive energy system that protects the environment. The document includes fiv e strategic 
pillars: (i) updating regulations, (ii) research, development and innovation, (iii)  sustainable energy 
supply, (iv) energy security and integration, and (v) efficient energy consumption. The 2020 -50 
policy contains key energy transition measure s, such as: decarbonizing the electricity matrix and 
carbon sequestration; fulfilling international commitments; updating the sector 's regulations; energy 
efficiency and universal access; exploring future energy alternatives and clean technologies; waste -
to-energy; promoting high/low -temperature geothermal energy; using renewable energy; migrating 
from liquefied petroleum gas (LPG) to natural gas in industry; and developing the green hydrogen 
value chain.  
4.2.2.1   Electricity  
4.49.  The Salvadoran electricity infrastructur e comprises power -generation plants interconnected 
through the transmission system to distribution grids, and distributed power -generation plants and 
producer users (self -consumption) that supply their electricity directly to the distribution grids. The 
supply from distributed power -generation operators and producer users constitutes the retail 
market. The wholesale market comprises the long -term contract market and the regulatory market. 
Regional import and export transactions are also carried out through the Regional Electricity Market 
(MER).  
4.50.  By the end of 2022, El Salvador had nominal installed electricity generation capacity of 
2,816.5 MW compared with 1,670.3 MW in 2016. In May 2022, the country's first natural gas -fired 
thermal power plant came into op eration. In 2016 -22, renewable sources grew significantly in 
electricity -generating capacity, mainly due to the introduction of long -term contract tenders to 
develop non -conventional renewable power generation projects, together with the fiscal incentives 
that have been granted (Table 4.5).  
Table 4.5 Installed capacity by source, 2016 and 2022  
Market/source  2016  2022  
Installed capacity  Installed capacity  
MW (%) MW (%) 
Wholesale market  1,629.0  97.5 2,453.7  87.1 
Hydraulic  472.6  28.3 552.7  19.6 
Geothermal  204.4  12.2 204.4  7.3 
Biomass  195.4  11.7 293.6  10.4 
Photovoltaic  0.0 0.0 213.9  7.6 
Wind 0.0 0.0 54.0 1.9 
Thermal (diesel and bunker)  756.6  45.3 757.1  26.9 
Natural gas  0.0 0.0 378.0  13.4 
Retail market  41.3 2.5 362.8  12.9 
Hydraulic  22.5 1.3 21.1 0.7 
Biogas  6.8 0.4 6.9 0.2 
Photovoltaic  12.0 0.7 309.9  11.0 
Thermal  0.0 0.0 14.0 0.5 
Biomass  0.0 0.0 11.0 0.4 
Total  1,670.3  100 2,816.5  100 
Source:  SIGET.  
4.51.  In 2022, the transmission network had 41 lines at 115 kV (totalling 1,073.8 km in length), 28 
power substations and 4 lines at 230 kV (totalling 287 km in length), the latter comprising sections 
of the Electricity Interconnection System for the Countries of Central Ame rica (SIEPAC). During the 
review period, El Salvador remained a net importer of electricity. The share of imported electricity 
in wholesale market supply ranged from 12.6% to 27.6%. Transmission losses averaged 1.84%45 
and total distribution losses46 avera ged 10.5%47 in 2021.  
4.52.  The authorities estimate that in 2018 around 97% of Salvadoran households had access to 
the electricity service and around 45,000 households still lacked access to electricity. In 2018, the 
 
45 Statistical Yearbooks 2016 -21 of the Transactions Unit.  
46 Total distribution losses consist of total technical and non-technical losses.  
47 General Supervisory Authority for Electricity and Telecommunications (SIGET) (2021), Electrical 
Statistics Bulletin.  WT/TPR/S/440  • El Salvador  
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  average cumulative hours of supply disruption  amounted to 10 hours for urban users and 24  hours 
in rural areas.  
4.53.  In 2022, operators active in the Salvadoran electricity market included 25 wholesale market 
generators, 764 retail market generators, 1 transmitter, 8 distributors and 34 marketers. Four of  
the eight distribution companies, which supply around 70% of electricity demand, belong to the 
same parent company.  
4.54.  The Transactions Unit (UT), a partly state -owned entity operating as a corporation, manages 
the wholesale electricity market and operates t he transmission system. Power transmission is 
operated by Empresa Transmisora de El Salvador  (ETESAL), a private entity partly owned by the 
State, through the Río Lempa Hydroelectric Executive Commission (CEL). CEL, a state -owned 
company, is responsible for the development, conservation, management and use of domestic 
energy resources and energy sources. During the review period, CEL operated four hydroelectric 
power plants supplying power to the wholesale electricity market. CEL's subsidiaries also undertake 
generation activities using thermal, geothermal and hydroelectric sources, and carry out marketing 
activities.  
4.55.  The sub -sector is mainly governed by the General Electricity Law (LGE), the Law on tax 
incentives for the promotion of renewable energies in electricity generation, the Law regulating the 
granting of small -scale generating project con cessions and their respective implementing 
Regulations.48 The LGE regulates the generation, transmission, distribution and marketing of 
electricity. It is applicable to all entities engaged in such activities, be they public, mixed or private, 
regardless o f their degree of autonomy and legal form. The LGE 's implementing Regulations set out 
the procedures necessary to comply with the LGE. The Regulations for the operation of the 
transmission system and the wholesale market based on production costs (ROBCP) c ontain rules 
and procedures for the operation of the transmission system and the administration of transactions 
in El Salvador's wholesale electricity market, taking into account transactions with the regional 
electricity market (MER).  
4.56.  A single entity may carry out electricity generation, transmission, distribution and/or 
marketing activities, provided that it establishes separate accounting systems for each activity, duly 
registered with SIGET. In accordance with the regional regulations, those eligible to  participate in 
the MER are nationally -registered agents granted "authorized market participant" status, which are 
required to provide payment guarantees to carry out transactions on the MER.49 
4.57.  Generation and distribution companies must allow their install ations to be interconnected and 
used for transporting electricity, except insofar as this may pose a threat to the functioning or safety 
of the system. A  concession is required only in order to generate electricity from hydraulic or 
geothermal sources. The re are no nationality requirements for obtaining concessions or operating 
in the electricity sub -sector in El Salvador.  
4.58.  During the review period, amendments  to the General Electricity Law (LGE) established: 
(i) the authority of the Legislative Assembly to approve concessions for the generation of electricity 
from hydraulic and geothermal sources; (ii) the definition of public service for the activities of 
electricity generation, transmission, distribution and marketing; (iii) the possibility for a concessio n 
to be granted to a public -private partnership; and (iv) the inclusion of public contracts in the tariff 
schedules.50 
4.59.  Public contracts are those that distribution companies enter into with companies in which the 
State has a majority interest and direct control. Such contracts may be short or long -term, and are 
entered into in accordance with the guidelines issued for this purpose by the Directorate -General of 
Energy, Hydrocarbons and Mining and the procedures established by SIGET, and their prices  are 
transferable to the distributors' electricity tariffs. Such contracts have served to implement measures 
aimed at achieving electricity price stability for all end -users.  
 
48 Legislative Decrees No. 843 of 25 October 1996, No. 462 of 8 November 2007 and No. 460 of 
26 September 2013.  
49 Regulations governing the regional electricity market , No. 3, Vol. 1 (General aspects).  
50 Legislative Decrees No. 542 of 17 November 2016, No. 146 of 31 August 2021, and No. 331 of 
22 March 2022.  WT/TPR/S/440  • El Salvador  
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  4.60.  Bilateral contracts signed between market participants are entered into freely by  the parties 
and, since they are not overseen or regulated by SIGET, their prices are not transferable to the 
electricity tariffs of distributors' end -users.  
4.61.  In accordance with the regulations in force, distributors must enter into long -term contracts 
(CLPs) through free competition processes, to comply with the minimum contracting percentage 
relative to maximum demand, and such contracts may concern existing generation or the 
development of new generation, be it conventional or using non -conventional renew able resources. 
Contracting procedures on the signing of CLPs are contained in the "Rules on long -term contracts 
through free competition processes" approved by SIGET.  
4.62.  SIGET's responsibilities in electricity matters include: (i) regulating and approving th e 
maximum tariffs for sale to final consumers, and the charges for related services,51 (ii) applying 
sanctions as applicable according to the regulations, (iii) issuing technical norms and standards, 
(iv) settling disputes between operators by administrati ve means, and (v) approving the plan for 
the expansion of the transmission network.  
4.63.  Until 2021, the Social Investment Fund for Local Development (FISDL), an autonomous public 
institution, managed the Fund for National Electricity and Telephony Investment F und (FINET), 
created in 1998, a responsibility that was transferred in 2022 to the Directorate for Municipal 
Works.52 The fund is used to administer and allocate the following subsidies: (i) subsidy for the 
construction of electrification projects, (ii) su bsidy for residential electricity consumption, and 
(iii) subsidy for communal pumping systems. The subsidy for residential electricity consumption 
applies to low -income residential users who, in the six months prior to electricity billing, have 
consumed an  average of up to 105 kWh per month; the user must also be the owner of a single 
dwelling and the dwelling must not be used for recreational or leisure purposes.  
4.64.  The tax incentives scheme for investment in renewable energy projects has remained 
unchanged s ince El Salvador's last review. Through the Law on tax incentives for the promotion of 
renewable energies in electricity generation, in force since the end of 2007, and the 2015 
amendment thereto, El Salvador maintains a number of tax exemptions.53 Under t his incentive 
scheme, any new investment in electricity generation using renewable energy sources (hydraulic, 
geothermal, wind, solar or biomass) is eligible for tariff concessions and other tax benefits. 
Specifically, these benefits include: (i) exemption  from import duties (for the first 10 years) for 
machinery, equipment, materials and inputs intended exclusively for pre -investment and investment 
in the construction and expansion of electricity -generating plants, including substations and 
transmission or  sub-transmission power lines; (ii) exemption from income tax for five years for 
projects of more than 10 MW and for 10 years for projects of less than 10 MW; and (iii) total 
exemption from the payment of taxes on income stemming directly from the sale of reduced 
emission certificates (CERs) under the clean development mechanism (CDM) or similar 
carbon  markets.  
4.2.2.2   Hydrocarbons  
4.65.  El Salvador remains a net importer of refined petroleum products, as it has no oil reserves or 
functioning oil refinery. In 2021, the o il bill reached USD 1,662,363,297.35, accounting for 5.5% of 
GDP. 
4.66.  Refined petroleum products are imported by sea and land, and are subject to 0 -15% tariffs. 
El Salvador has 1,306 registered liquid fuel storage tanks and 1,774 registered liquefied petroleum  
gas (LPG) storage tanks, which are privately owned. El Salvador does not impose restrictions on the 
import, export, storage, refining, transport and distribution of petroleum and petroleum products. 
There is no legislation requiring stockpiles.  
 
51 The following charges are subject to regulation and prior ap proval by SIGET: (i) for the use of the 
transmission and distribution networks; (ii) for the operation of the transmission system and the wholesale 
market; and (iii) the charges for connecting users to the distribution networks.  
52 Legislative Decree No. 21 0 of 17 November 2021.  
53 Legislative Decree No. 462 of 20 December 2007 and Legislative Decree No. 148 of 28 October 2015, 
respectively.  WT/TPR/S/440  • El Salvador  
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  4.67.  In 2022, t hree private oil companies were engaged in the import, export and distribution and 
477 in the marketing of petroleum products on the domestic market at service stations. Regarding 
the LPG market, four companies are engaged in marketing, export, import and storage activities.  
4.68.  The sub -sector is mainly governed by the Hydrocarbons Law54, the Law regulating the storage, 
transport and distribution of petroleum products55, and the Natural Gas Law56. El Salvador continues 
to provide a specific subsidy for LPG for residential consumption. From October 2021, through the 
Temporary Law to stabilize the price of liquefied petroleum gas, a general subsidy was introduced 
for all Salvadorans, as a temporary measure to reduce the impact of the global economic crisis, 
effect ive until 31 December 2022.57 The LPG -specific subsidy amounted to USD 99 million in 2021, 
reflecting rising LPG prices, up from USD 62.9 million in 2020 and USD 66.2 million in 2019. In the 
first nine months of 2022, the LPG subsidy amounted to USD 80.3 m illion.  
4.69.  The special tax on fuels (IEC) is levied on the import and distribution of gas oil, diesel oil, 
gasoline and their blends with other fuels. The IEC is applied at an ad valorem  rate on the 
international reference price of a barrel of oil and is part  of the structure of the reference prices of 
gasoline and diesel oil for the local market, which are published fortnightly by the Ministry of 
Economic Affairs (MINEC). MINEC also draws up a quarterly executive decision that is forwarded to 
the Ministry of Finance to determine the IEC's value. The rate is 1% if the value of a barrel of oil 
does not exceed USD 50; 0.5% if the price of a barrel is between USD 50 and 70; and 0% if the 
price of a barrel exceeds USD 70.  
4.70.  In 2022, a number of measures were taken to  mitigate rising hydrocarbon prices and to 
counter inflation in general. On 13 March 2022, three legislative decrees were published suspending 
the special transport contribution (COTRANS) and the charge related to the special account for the 
stabilization of economic development (FEFE), and establishing a different penalty framework 
(special law) on penalties for offences in the marketing of petroleum products. Legislative Decree 
No. 321 of 22 March 2022 established differentiated VAT for petroleum products , whereby each 
liquid fuel is levied at a different rate. Legislative Decree No. 345 of 4 April 2022 also established 
maximum fuel prices until the end of May 2022, a decision that was amended and extended 
until December 2022. The temporary suspension of t he FEFE and COTRANS taxes was repealed on 
28 September 2022. The subsidy mechanism for fuel pricing is implemented through petroleum 
product importing companies, which absorb the fortnightly increases in fuel prices; the central 
Government then reimburses these amounts by granting tax and treasury credit notes. The subsidy 
to stabilize gas prices is financed from a fund.  
4.3  Manufacturing  
4.71.  This sector, including the maquila industry, recorded a GDP share at current prices of 15.2% 
in 2021 (17.1% of value added),  compared with 16.3% in 2016 (17.9% of value added); this share 
climbed to 16.5% in the first quarter of 2022. The manufacturing sector employed 461,811  people 
in 2019, accounting for 15.3% of the labour force.  
4.72.  Manufacturing value added totalled USD 4,182. 4 million (including maquila) in 2019, the most 
recent year for which complete information is available. Industries contributing most to value added 
in 2019 were: bakers' wares (10.3% of the total); made -up articles (8.4%); textiles (7.4%); 
alcoholic and n on-alcoholic beverages (7.2%); processing and preserving of meat (5.8%); 
maintenance and repair of machinery (5.8%); and manufacture of other non -metallic mineral 
products (5.8%) (Table 4.6).  
 
54 Legislative Decree No.  626 of 17 March 1981.  
55 Legislative Decree No.  169 of 30 November 1970.  
56 Legislative Decree N o. 630 of 20 June 2008.  
57 Legislative Decree No.  168 of 28 September 2021, as extended by Legislative Decree No.  514 of 
27 September  2022.  WT/TPR/S/440  • El Salvador  
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  Table 4.6 Value a dded in manufacturing, 2015 -19 (most recent year available)  
(USD million)  
 2015  2016  2017  2018  2019  
Manufacturing industries  3,840.94  3,939.74  4,017.81  4,082.11  4,182.35  
 Processing and preserving of meat  265.45  268.3  236.89  240.06  244.52  
 Processing and preserving of fish, 
crustaceans and molluscs and products of 
fish 33.97  40.83  41.42  34.81  33.95  
 Production of vegetable and animal oils 
and fats  26.88  22.08  22.86  27.13  25.69  
 Production of dairy products  136.10  137.25  141.98  144.78  148.71  
 Production of grain mill products, 
starches and starch products  197.76  187.96  199.71  189.25  201.27  
 Production of bakers' wares, macaroni, 
noodles, couscous and similar farinaceous 
products  361.37  374.13  389.07  413.85  424.16  
  Sugar production  201.41  162.18  201.05  181.16  184.31  
  Production of other food products  190.79  173.38  172.87  171.1  169.41  
 Production of alcoholic and non -alcoholic 
beverages and mineral waters  272.17  288.69  286.83  280.44  300.34  
  Manufacture of textile products  271.8  284.66  285.39  310.73  309.77  
  Manufacture of clothing  324.22  338.5  350.25  368.65  350.26  
  Maquila of made -up articles  168.26  187.9  136.23  133.68  134.83  
  Leather and footwear  80.27  66.23  69.73  66.41  63.58  
  Production of wood and products of wood 
and cork  42.55  50.13  47.51  48.03  51.16  
  Manufacture of paper and paper products  89.44  91.55  98.04  93.85  98.88  
  Printing  72.73  69.97  66.55  74.75  80.72  
  Manufacture of coke and refined 
petroleum products  14.83  16.96  16.1 11.5 13.65  
  Manufacture of chemicals and chemical 
products  119.48  116.69  111.46  110.67  116.36  
  Manufacture of pharmaceuticals, 
medicinal chemicals and botanical products  79.76  84.59  97.09  100.7  106.07  
  Manufacture of rubber and plastic 
products  149.1  162.34  158.9  163.39  165.19  
  Manufacture of other non -metallic 
mineral products  168.04  220.96  256.33  218.99  242.44  
  Manufacture of base metals  63.85  64.76  68.02  75.95  70.95  
  Manufacture of metal and electronic 
products  156.33  160.75  171.75  183.18  186.48  
  Manufacture of furniture  89.82  89.09  87.68  96.3 84.63  
  Maintenance and repair of machinery  190.07  197.64  209.01  218.45  243.64  
  Maquila of other products  74.5 82.22  95.08  124.3  131.38  
Source:  National Accounts Department, BCR.  
4.73.  In 2022, the average MFN tariff for the manufacturing sector (according to the ISIC  Rev.2 
classification) was 6.2% and the tariff applied to non -agricultural products (WTO  definition) was 
5.3%. Manufactured products with above -average tariffs are clothing (14 .8%), textiles (8.1%) and 
transport equipment (7.8%).  
4.74.  Manufacturing companies can take advantage of the free zone (LZFIC) and inward -processing 
warehouses  (DPA) regimes. In accordance with the LZFIC regime, Salvadoran or foreign 
manufacturing companies (am ong others) may become established in a free zone when engaged in 
any of the following: production, assembly or maquila, manufacturing, processing, transformation 
or marketing of industrial goods (Chapter 3 and Chapters 25 -97 of the Central American Tariff  
System). Companies under the free -zone regime may benefit from tax concessions ( Section 
3.2.4.3). In October 2022, 17 free zones were in operation and there were plans to expand nine 
existing free zones and one plan to establish a new free zone. In 2021, some 205 companies were 
operating under the free -zone and DPA regime, creating some 80,000 permanent jobs. Free -zone 
exports amounted to USD 1,252 million in 2021.  WT/TPR/S/440  • El Salvador  
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  4.4  Services  
4.4.1   Multilateral commitments  
4.75.  El Salvador undertook specific commitments in six of the 1 2 service categories covered by the 
General Agreement on Trade in Services (GATS). Those six categories were financial services; 
communication services; business services; environmental services; tourism services; and transport 
services (air transport only ).58 El Salvador undertook commitments in 25 of the sectors on the 
Services Classification List prepared by the WTO  Secretariat.  
4.76.  El Salvador's Schedule of Specific Commitments includes the following horizontal 
commitments: the requirement for a foreign company seeking to engage in commercial activities in 
El Salvador to appoint a permanent representative in the country and accept to be subject to 
Salvadoran laws; freedom for foreign investors to remit abroad profits, as well as payments for 
rights to use foreign trademarks and patents, subject to certain limits; with respect to the 
commercial presence of foreign investors, freedom to hire foreign personnel in certain numbers, but 
with the requirement that every employer ensures, unless specificall y authorized otherwise, that the 
enterprise's total personnel is at least 90 % Salvadoran and that at least 85 % of total wages are paid 
to Salvadorans.  
4.77.  El Salvador's Schedule of Specific Commitments includes exemptions from MFN  treatment, in 
all sectors, fo r member States  of the Central American Common Market. In the case of financial 
services, such exemptions were added for Honduras and Nicaragua, pursuant to the Convention on 
facilitating the financial integration of the countries of the Central American I sthmus.59 
4.78.  After participating in the negotiations on the Fourth Protocol on Basic Telecommunications60 
and Fifth Protocol on Financial Services61 annexed to the GATS, El Salvador accepted both protocols. 
As a result of those negotiations, El  Salvador revised and amplified its Schedule of Specific 
Commitments for each of the sectors concerned.62 
4.4.2   Financial services  
4.4.2.1   Overview  
4.79.  The financial services sec tor (banks, insurance companies and other financial institutions) 
accounted for 6.6 % of total current GDP in 2021, with total turnover amounting to USD  1.9 billion. 
This share of GDP surpassed the 6.3 % recorded in 2015.63 
4.80.  The Supervisory Authority for the Financial System (SSF) is responsible for supervising the 
individual and consolidated activities of institutions within the financial system (banks, cooperative 
banks, insurance companies, savings and loan societies, securities, pensions, financial 
conglom erates, credit agencies, commodity exchanges and the occupational risks regime of the 
Salvadoran Social Security Institute (ISSS)) under a new regulatory framework. The SSF, as a 
supervisory body, forms part of the Central Reserve Bank of El Salvador, but has its own legal 
personality and assets, of indefinite duration, and administrative and budgetary autonomy for the 
exercise of its powers and duties under the law.64 
4.81.  The SSF's principal mission is to preserve the stability of the financial system, oversee ing its 
efficiency and transparency in accordance with best international practice. The SSF's functions 
include implementing and enforcing laws, regulations, technical standards and other legal provisions 
applicable to the financial system; preventively mo nitoring risks to financial system institutions; 
promoting the efficient, transparent and orderly functioning of the system; and ensuring that 
 
58 WTO document GATS/SC/29 of 15 April 1994.  
59 WTO document GATS/EL/29 of 15 April 1994.  
60 Ratified by El  Salvador by means of Legislative Decree No.  1.031 of 29 April 1997.  
61 Ratified by means of Legislative Decree No.  613, published in the Official Journal of 26 May  1999.  
62 WTO documents GATS/SC/29/Suppl.1 and GATS/SC/29/Suppl.2 of 11 April 1997 and 
26 February  1998, re spectively.  
63 Information provided by the authorities.  
64 Online information from the SSF. Viewed at: https://ssf.gob.sv/marco -institucional/ . WT/TPR/S/440  • El Salvador  
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  supervised institutions conduct their business, activities and operations in accordance with existing 
legislation .65 
4.82.  The role played by the SSF and the legal framework in which it operates are defined in the 
Law on the Supervision and Regulation of the Financial Sector.66 Other laws pertaining to the 
financial system are listed in Table 4.7. The Law on the Supervisio n and Regulation of the Financial 
Sector designates the SSF as the sole supervisory authority for the financial sector, including the 
financial system as well as pensions and securities. The SSF is composed of a Governing Board; a 
Superintendent appointed for a five -year term by the President of the Republic; four Deputy 
Superintendents, appointed for five -year terms by the President of the Republic from a list of 
candidates nominated by the Council of Ministers; and such officials and staff as the SSF may 
require..  
Table 4.7 Main financial and money laundering laws, 2022  
Financial laws  
1 Law on Facilitating Financial Inclusion  
2 Law on Electronic Book -Entry Securities  
3 Financial Leasing Law  
4 Banks Law  
5 Law on Cooperative Banks and Savings and Loan Societies  
6 Law on the Products and Services Exchange  
7 Law on Foreign Currency Exchange Offices  
8 Law against Usury  
9 General Law on Cooperative Associations  
10 Law on Credit Institutions and Auxiliary Organizations  
11 Law on the National Institute for Public Employee Pensions  
12 Law on the Institute of Social Security for the Armed Forces  
13 Securities Market Law  
14 Implementing Regulations for the Securities Market Law  
15 Organic Law of the Central Reserve Bank  
16 Law on the Privatization of Commercial Banks and Savings and Loan Associations  
17 Law Regulating Personal Credit History Information Services  
18 Law on the Reorganization and Strengthening of Commercial Banks and Savings a nd Loan Associations  
19 Pension Savings System Law  
19A Amendments to the Pension Savings System Law (Decree No.  787) 
20 Law on the Financial System for the Promotion of Development.  
21 Law on the Reciprocal Guarantee System for Small and Medium -Sized Enterprises in Rural and Urban Areas  
22 Law on the Credit Card System  
23 Law on the Supervision and Regulation of the Financial Sector  
24 Law on Insurance Companies   
25 Implementing Regulations for the Law on Insurance Companies  
26 Asset Securi tization Law  
27 Law on Investment Funds  
Legal framework for the prevention of money laundering and the financing of terrorism  
1 Law against the Laundering of Money and Other Assets  
2 Financial Investigation Unit Instructions to Prevent the Laundering of Money and Other Assets in Financial 
Intermediation Institutions  
3 Special Law against Acts of Terrorism   
4 Law on the Seizure of Illicitly Trafficked assets   
5 Central American Convention for the Prevention and Repression of Money Launderi ng Crimes Pertaining to 
Illicit Drug Trafficking and Related Offences  
Source:  SSF. Viewed at: https://ssf.gob.sv/estadisticas/marco -legal-y-normativo/leyes -2/. 
4.83.  A series of amendments to the laws governing the financial system were introduced during 
the review period, as shown in Table 4.8 . 
 
65 Online information from the SSF. Viewed at: https://ssf.gob.sv/marco -institucional/ . 
66 Legislative Decree No. 592 of 14 January 2011.  WT/TPR/S/440  • El Salvador  
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  Table 4.8 Principal amendments to financial laws, 2015 -22 
Financial laws  Action/amendment  
Law on Facilitating Financial Inclusion  2015: Enactment of the law  
2017: Amendment to permit participation in economic activity for 
excluded populations.  
2019: Adjustment of the amounts and scope of certain 
transactions . 
2022: Amendments to expand access to banking services.  
Law against Usury  2016: Adjustments to certain methodological provisions.  
2022: Amendments to strengthen the legislation and to prohibit 
and punish certain forms of behaviour.  
Law Regulating Personal Credit History 
Information Services  2015: Amendment to prevent abuses in the storage of personal 
credit information.  
2016: Amendment with respect to infringements.  
2021: Amendment to protect citizens' rights with respect to the 
veracity  of information.  
Law on the Credit Card System  2019: Amendments to several articles of the Law  
2021: Amendments for the protection of citizens' rights  
Law on the Supervision and Regulation of 
the Financial Sector  2015: Amendment to treat persons sendi ng or receiving money as 
participants in the system  
Special Law to Facilitate Access to Credit  2020: Enactment of the Law  
Source:  Information provided by the authorities and the SSF. Viewed at: 
https://ssf.gob.sv/estadisticas/marco -legal-y-normativo/leyes -2/. 
4.84.  The aim of the Law on Facilitating Financial Inclusion67, beyond such inclusion, is to promote 
competition in the financial system and reduce costs for users and customers through the application 
of minimum regulatory requirements, including: (a) requirements pertaining to the establishment 
and operation of electronic money suppliers, the capital and guarantees requir ed for these 
companies to be authorized to operate, and the grounds for revoking such authorization; 
(b) requirements that banks, cooperative banks and savings and loan societies must meet to operate 
as electronic money suppliers, and the consequences of n ot meeting them; (c) provisions as to the 
creation and use of electronic money and the entities authorized to supply it; (d) provisions to 
simplify contracts and procedures for opening savings deposit accounts and thereby improve access 
to banking services  for persons with limited income or living far from the traditional financial service 
establishments operated by banks, cooperative banks and savings and loan societies; (e) control as 
to the quantity of electronic money administered by the electronic plat form; and (f) the groundwork 
required to formulate public policies for the promotion of financial inclusion.  
4.85.  The Law requires that electronic money suppliers be established with minimum registered 
capital of USD  200,000, 60 % of which is to be fully subscri bed and deposited in cash with the Central 
Bank at the time of incorporation. The remaining 40 % is to be paid in the following three years of 
operation. The Law authorizes banks, cooperative banks, and savings and loan societies to operate 
as electronic mo ney suppliers subject to specified conditions.  
4.86.  The Law provides that electronic money representing an equivalent amount of the funds 
received directly by suppliers, through their points of service or shops, whether of local or foreign 
origin and for a legi timate purpose and from a legitimate source, shall be accepted as a means of 
payment by other persons, in accordance with the client's membership contract with the supplier. 
The maximum amount for each such transaction may not exceed the minimum monthly wa ge in the 
trade and services sector. Neither the maximum cumulative amount of such transactions received 
and concluded in any month, nor the maximum balance electronically accredited for any natural 
person with any supplier, may at any time exceed the mini mum trade -and-services -sector wage for 
five months. The Central Bank is required to update these limits every two years to maintain their 
value in real terms. Not subject to the transaction limits are accreditations for the payment of wages 
and pensions or  the receipt of remittances amounting to less than the minimum 
trade-and-services -sector wage for five months. The Law defines the characteristics of electronic 
money regulated therein as: (a) being of a monetary value represented in an electronic register  that 
increases or decreases according to the owner's use of it, effected by converting it into cash, 
transferring it or making payments with it; (b) not constituting a deposit of any kind nor guaranteed 
by the Deposit Guarantee Institute; (c) convertible into cash; (d) accepted as a means of payment, 
 
67 Decree No. 72 of 2 September 2015, as amended by Legislative Dec rees No. 592 of 26 January 2017 
and No. 464 of 31 October 2019.  WT/TPR/S/440  • El Salvador  
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  provided the supplier and other concerned actors have contracted to such effect; and (e) verifiable, 
in terms of the electronic money balance on record in its owner's name, by consulting the supplier's 
electro nic database into which the owner's electronic money transactions are to be entered. All 
electronic money transactions performed by a client within his membership network must be 
completed in real time.  
4.87.  The Special Law to Facilitate Access to Credit of 1  April 2020 was adopted to facilitate the 
awarding of credit during the COVID -19 pandemic. The Law establishes conditions for the granting 
of credit for productive activities, with a view to ensuring that regulatory requirements do not impede 
access to credi t in financial institutions. The Law's special status gave its provisions precedence over 
the rules otherwise applied by financial institutions when granting credit in small amounts. "Small 
amounts" are defined as the minimum trade -and-services -sector wage  for 10 months or less, and 
"productive activities" as activities that take place in the agricultural, industrial, commercial and 
service sectors and those carried out by entrepreneurs. The Law authorizes financial institutions, 
subject to their particular  risk models, to accept all forms of collateral, including credit guarantees, 
movable and immovable property, certificates of deposit, performance bonds, or rights to future 
flows. It also provides that, to grant credit in small amounts, financial institut ions are to simplify 
their requirements. Where a natural or legal person applies for credit for the first time, for an amount 
of USD  30,000 or less, for productive activities, they are not required to comply with financial 
indicators, particularly where th e collateral provided to the institution sufficiently covers the credit 
amount. Where a natural or legal person that is a previous borrower applies for credit exceeding 
USD 30,000, for productive activities, they are not required to comply with financial i ndicators, 
especially where the collateral provided to the institution is enough to cover the credit amount.  
4.88.  Responsibility for monitoring risks in the financial system, and managing financial crises 
arising therefrom, rests with the Systemic Risk Committe e, established by Executive Decree No.  172 
of 13 September  2013. It is composed of members representing the Ministry of Finance, the Central 
Reserve Bank, the SSF and the Deposit Guarantee Institute (IGD).  
4.89.  El Salvador participated in the financial services  negotiations and accepted the Fifth  Protocol 
annexed to the GATS, incorporating it into domestic law by means of Legislative Decree No.  653 of 
13 March  1999. Its commitments with respect to the banking sector included the granting of access 
to foreign fin ancial institutions through the establishment of branches or participation in the 
ownership of domestic banks and finance houses up to a maximum of 75 % of the capital, provided 
that they are classified as first -grade and are subject to prudential regulatio n and supervision in 
their countries of origin.68 For foreign natural persons, the maximum percentage is 25 %. El Salvador 
has not undertaken commitments with respect to insurance.  
4.4.2.2   Banking  
4.90.  As at 31  May 2022, the Salvadoran banking sector consisted of 24 ins titutions authorized to 
take deposits: 11 private banks (10 of which were foreign -owned, including the branch of a foreign 
bank); two state -owned banks; seven cooperative banks; and four savings and loan societies.69 
Other entities, authorized to perform a sset transactions but not to take deposits, were subject to 
SSF supervision and thus formed part of the Salvadoran financial sector as well. Also in operation 
were eight financial conglomerates, six state -owned financial institutions, two exchange offices,  and 
one representative office of a foreign bank.70 
4.91.  As at 31  May 2022, total assets in the banking system amounted to USD  24,178.3  million 
(84.1 % of 2021 GDP), of which loans accounted for USD  16,039.6  million. Deposits totalled 
USD 17,502.7  million (60.9 % of 2021 GDP). In percentage terms, 66.3 % of the assets were 
concentrated in net loans, 17.5 % in cash and 12.2 % in financial investments. In Dece mber 2015, 
by comparison, the figures were 68.2 % for net loans, 20.4 % for cash and 6.8 % for financial 
investments, so the figures reflect a relative increase in net investment during the period analysed.71 
4.92.  The Salvadoran banking system remained characteriz ed by good solvency and risk indicators 
during the review period, though somewhat inferior to those observed previously. The system's 
 
68 WTO document GATS/SC/29/Suppl.2 of 26 February 1998.  
69 Information from the SSF. Viewed at: https://ssf.gob.sv/servicios/ entidades -supervisadas/ . 
70 Information from the SSF. Viewed at: https://ssf.gob.sv/servicios/entidades -supervisadas/ . 
71 Information provided by the authorities.  WT/TPR/S/440  • El Salvador  
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  average capital adequacy ratio as at 31  May 2022 stood at 15 %, below the 17.5 % observed in 
December  2015 but still above t he statutory minimum of 12 % required by the Banks Law. Scoring 
highest here were cooperative banks, with a ratio of 22.2 %. The system's 14 % return on equity was 
higher than in the two previous years (9 % and 10.6 %), when bank profits, along with economic 
activity in general, had declined under the effects of the pandemic. The return on assets was 1.6 % 
in May  2022 (compared to 1.2 % and 1 % in May  2020 and May  2021, respectively). Non -performing 
loans represented about 1.9 % of the total at the same date. In May  2022, 33.6 % of total loans were 
for consumption, 16.8 % for the purchase of housing, and 49.6 % for businesses. At 31  May 2022, 
the system's gross loan portfolio amounted to USD  16,513  million, about 8.5 % larger than in the 
same month the year before. Activ ity in the commercial and manufacturing sectors was particularly 
dynamic.72 
4.93.  The banking sector is governed principally by the Banks Law73 and amendments thereto, as 
well as various related laws.74 Also important is the Law on Facilitating Financial Inclusi on75, enacted 
to regulate electronic money activities and facilitate access to credit for MSMEs. This latest review 
period saw the adoption of various new laws and regulations to improve supervision and promote 
financial inclusion, as shown in Table 4.8.  
4.94.  Under the Banks Law, all banks established in El Salvador must be organized and operate as 
closed -end public limited companies with their capital divided into registered shares held by no fewer 
than 10 shareholders. The Law stipulates that at least 51 % of the shares must be owned by: natural 
persons of Salvadoran or Central American nationality; Salvadoran legal entities a majority of whose 
shareholders or members are either natural persons of Salvadoran or Central  American nationality 
or other Salvadoran le gal entities; or foreign banks and other financial institutions in whose country 
of origin there are prudential regulations and supervision in accordance with relevant international 
practices and which are classified as first -grade financial institutions b y internationally recognized 
risk rating companies. The SSF maintains a register of such first -grade foreign banks and financial 
institutions.76 
4.95.  For foreign banks, commercial presence in El Salvador can take the form of a branch office or 
a representative office, with SSF authorization required in either case. SSF authorization is also 
required for any transaction representing more than 1 % of a bank's capital. This applies to natural 
persons as well as legal entities. In the case of a foreign bank branch, the capital must reflect the 
volume of activity in the country (working capital) specified in the authorization. Foreign bank 
branches ma y engage in the same operations as banks established in the country, including the 
opening of subsidiaries in which the bank holds at least 51 % of the capital. In general, the Banks 
Law stipulates that the branches and offices of foreign financial institut ions operating in El Salvador 
shall be accorded national treatment in respect of rights as well as privileges. Representative offices 
of foreign banks may place funds in the country in the form of loans or investments but may not 
take deposits. The only ex ception to national treatment pertains to assets that a foreign financial 
institution may own in El Salvador. In cases of that kind, the Banks Law provides that depositors 
and creditors domiciled in El Salvador enjoy preferential rights over those domicile d abroad.  
4.96.  At 31  December  2022, the minimum capital requirement for the establishment of banks in 
El Salvador was USD  18.09  million (USD  18,091,993 to be precise). This requirement applies to 
domestic banks, whether owned privately or by the State, as well as foreign -owned banks. The 
 
72 Information provided by the authorities.  
73 Decree No.  697 of 2  September  1999.  
74 The related laws include the Financial Leasing Law (Decree No.  884 of 20 June 2002), and 
amendments thereto; the Law on the Reorganization and Strengthening of Commercial Banks and Saving s and 
Loan Associations (Decree No.  659 of 30 November 1990), and amendments thereto; the Organic Law of the 
Supervisory Authority for Pensions (Decree No.  926 of 19 December 1996); the Law on Cooperative Banks and 
Savings and Loan Societies (Decree No.  849 of 23 February 2000); the Law Establishing the Multisectoral 
Investment Bank (Decree No.  856 of 21 April 1994); and the Law on Facilitating Financial Inclusion (Decree 
No. 72 of 13 August 2015).  
75 Decree No.  72 of 13  August  2015.  
76 As of February 2022, 7 1 such institutions from the following countries and territories had been so 
registered: Austria; Brazil; Canada; Chinese Taipei; Colombia; France; Germany; Honduras; India; Israel; 
Italy; Japan; Mexico; the Netherlands; Norway; Panama; Peru; Puerto Rico; Spain; Sweden; Switzerland; the 
United Kingdom and the United States. Information from the SSF. Viewed at: 
https://ssf.gob.sv/2022/02/02/bancos -de-primera -linea/ . WT/TPR/S/440  • El Salvador  
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  minimum capital requirement for non -specialized savings and loan societies was USD  3.95 million 
(USD  3,948,598), while that for cooperative banks supervised by the SSF was USD  800,750.77 
4.97.  The SSF must be notified no fewer than fi ve working days in advance of bank operations 
entailing any encumbrance of a bank's freely available assets amounting to more than 2.5 % of its 
base capital. If observations do not arise from the Superintendent's analysis of the operation a "no 
objection" r uling is then issued. Banks are free to determine their own interest rates, commissions 
and fees subject to prior communication of their interest -rate variation policies to the Central Bank, 
which has the authority to intervene only in the event of severe disturbances to monetary and credit 
markets – and even then, for 180 days at most. The Banks Law requires banks to publicly disclose 
their interest rates, commissions and fees on a monthly basis, or after adjusting them.  
4.98.  The Banks Law contains no provision s on the cross -border supply of banking services or on 
the freedom of Salvadorans to procure such services abroad.  
4.99.  Financial conglomerates also fall within the regulatory scope of the SSF and are subject to 
consolidated SSF oversight. The Banks Law defines  "financial conglomerate" as a group of companies 
controlled by a "holding company", i.e. a member of the group owning more than 50 % of its total 
share capital.  
4.100.   The SSF may qualify a group as a "de facto conglomerate" if finding it to have operated in 
such fashion without authorization to do so. The Banks Law permits a presumption of concerted 
control where one of more individuals act jointly, directly or through third parties, to gain sufficient 
ownership of a company's shares or manage otherwise to: (a) c ontrol a majority of votes in general 
shareholders' meetings (or elect a majority of the company's directors); or (b) control 10 % or more 
of the company's voting capital (or a percentage sufficient to defeat such attempts by other 
shareholders). Concerted control can also be presumed where two or more of a conglomerate's 
companies share common directors or a common corporate image. De facto conglomerates identified 
as such could be brought under SSF supervision and required to regularize their situations, b ut as 
at May  2022 this had never occurred.  
4.101.   A conglomerate may also be controlled by a domestically established "holding bank" (subject 
itself to SSF supervision) or by a company established specifically to that end (a sole -purpose holding 
company), each be ing subject to different limitations. While a holding bank is barred from investing 
in institutions that administer pension funds or insurance companies, a holding company that is not 
a bank can invest up to 25 % of its base capital in the shares of institu tions administering domestic 
pension funds or in companies that are not members of the respective conglomerate. A sole -purpose 
holding company must undertake to invest more than 50 % of the conglomerate members' capital. 
Holding companies may not, moreover,  maintain credit or commercial relations with conglomerate 
members (with the exception of convertible loans or debentures issued by the latter or enter into 
contracts with third parties if not necessary to accomplish their purpose. Nor may they undertake 
any kind of financial obligation toward third  parties that exceeds 20 % of their paid -in capital and 
capital reserves. A bank established abroad may form part of a conglomerate, provided that the 
holding company owns at least 45 % of its shares and specified prudential requirements have been 
met.78 As at November  2022 there were eight financial conglomerates under SSF supervision.79 
4.102.   In the event of a bank being wound up or going into compulsory liquidation, the Deposit 
Guarantee Institute (IGD) guarantees depo sits made by the public up to a maximum of USD  10,832 
(the amount guaranteed per depositor in each institution, as from 1  January  2022).80 As established 
in the Banks Law, the IGD is governed by a Board of Directors whose members are appointed for 
renewabl e terms of four years. All private banks, cooperative banks and savings and loan societies 
 
77 The minimum paid-in capital requirement is USD  643,971 for the federations of cooperative banks 
qualified by the SSF and USD  1,588,221 for savings and loan societies catering to small and micro enterprises.  
78 Those requirements include the following: (a) the foreign b ank must be subject to consolidated 
supervision by the SSF and be supervised in its country of domicile in accordance with international practice; 
(b) the SSF must have signed cooperation agreements with the supervisory body of the host country to 
facilita te consolidated supervision; (c) the foreign bank must be considered in assessing the conglomerate's 
solvency; and (d) the holding company must be shown to exercise control over the bank.  
79 Information from the SSF. Viewed at: https://ssf.gob.sv/conglomerados -financieros/ . 
80 Guarantee amounts are revised every two years by the Governing Board of the SSF, in accordance 
with the Banks Law. The most recent revision took place on 1 January 2022. Info rmation from the IGD. Viewed 
at: https://igd.gob.sv/ . WT/TPR/S/440  • El Salvador  
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  are members of the IGD. The Mortgage Bank of El Salvador is subject to the same deposit insurance 
regime as a private bank, while in the case of the Agricultural Dev elopment Bank the guarantee is 
provided by the State. The guarantee excludes related -party and pledged loans and is financed with 
contributions from banks and other financial institutions. The contributions are paid annually and 
are equivalent to 0.1 % of the average daily deposits held by each institution during the previous 
three months. As at February  2022, deposits amounting to USD  4,302.1  million were guaranteed by 
the IGD, representing 25.7 % of total deposits. The IGD fund amounted at that time to 
USD 228.4  million, or about 5.3 % of the deposits guaranteed.81 
4.4.2.3   Insurance  
4.103.   The Supervisory Authority for the Financial System (SSF) supervises the activities of 
insurance companies, insurance intermediaries and reinsurers. The legal framework for the 
insurance m arket did not change during the review period, and remains based on the Law on 
Insurance Companies of 1996 and its implementing regulations.82 
4.104.   Insurance companies established in El Salvador must be organized and operate in the form 
of closed -end public limited companies of indefinite duration with their capital divided into registered 
shares. They may be named freely provided the name chosen differs from that of any other existing 
company. Insurance companies may operate in the general (casualty) insurance branch or the 
personal insurance branch or specialize exclusively in bonds. They may also offer reinsurance in 
their respective branches with Salvadoran insurance companies. General insurance companies may 
offer casualty, accident and health insu rance, and may also conduct bond operations if not dedicated 
exclusively to that activity. Insurers may operate in the general (casualty) insurance branch and 
personal insurance branch at the same time, but in this case are not permitted to sell personal l ife 
annuity policies.83 
4.105.   Insurance or reinsurance companies and intermediaries (agents, brokers) require 
SSF authorization to operate in the Salvadoran market. Such authorization is granted for an 
indefinite period. Insurers are required to identify their s hareholders. Foreign insurance or 
reinsurance companies (from outside the Central  American area) must show that they operate in 
accordance with the prudential regulations in force in their country of origin and are classified as 
first-grade financial insti tutions by internationally recognized risk rating companies.84 Those 
requirements do not apply to Central American insurers, in which case certification is requested from 
supervisory authorities in their countries of origin. Intermediaries, including indep endent agents 
(natural persons) or insurance brokers (legal entities), must successfully undergo an SSF evaluation 
and deposit a surety bond to operate in the country.85 Intermediaries are not subject to nationality 
or residence requirements.  
4.106.   Insurers must  maintain a minimum net worth to support their operations. Under current 
regulations, solvency margin requirements can vary depending on the insurance or reinsurance 
company concerned based on technical criteria applied to their operations. The Insurance L aw 
requires equity sufficient to maintain a ratio of total debt to net worth of five or less. The solvency 
margin required for casualty, accident, illness and supplemental life insurance companies is 
determined based on the sum of the following amounts: (a ) the greater of the amounts resulting 
from the application of a percentage between 24 % and 40 % to the annual amount of direct insurance 
and assumed reinsurance premiums, multiplied by the result of dividing claims net of reinsurance 
by the company's total  claims, with this ratio being no less than 50 %; and (b) the application of a 
percentage between 45 % and 72 % to average direct insurance and assumed reinsurance claims for 
the last three years, multiplied by the result of dividing claims net of reinsurance  by the company's 
total claims, with this ratio being no less than 50 %. In the case of life insurance, the sum of the 
following amounts: (a) between 5 % and 7.5 % of the mathematical reserves relating to direct 
insurance and assumed reinsurance, excluding th ose from life annuities, multiplied  by the result of 
dividing the mathematical reserves on non -ceded insurance by the company's total mathematical 
 
81 Deposit Guarantee Institute, Boletín Informativo. Estadísticas del IGD al 28 de febrero de 2022 . 
Viewed at: https://igd.gob.sv/wp -content/uploads/2022/07/Boletin -IGD-RB-Febrero -2022.pdf . 
82 Decree No.  844 of 21 October 1996, amended by Legislative Decrees No.  893 of 21 November 1996 
and No.  910 of 14 December 2005, and enteri ng into force on 1 January 1997; and Decree No.  44 of 
20 April 1999, as amended by Decree No.  25 of 5 April 2001.  
83 Article 19 of Decree No.  844. 
84 Article 6 of Decree No.  844. 
85 Article 50 of Decree No.  844 and SSF Rules NPS4 -11 for the authorization of i nsurance intermediaries.  WT/TPR/S/440  • El Salvador  
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  reserves, with this ratio being no less than 85 %; (b) between 0.2 % and 0.5 % of capital at risk, 
meaning the r esult of the direct insured amounts and assumed reinsurance minus the corresponding 
mathematical reserves, excluding those from life annuities, multiplied by a ratio between capital at 
risk retained and direct capital at risk and assumed reinsurance, which  shall not be less than 50 %; 
(c) between 8 % and 10 % of the reserves deriving from life annuity operations. For the motor vehicle 
branch, the greater of the following amounts: (a)  a percentage between 26 % and 40 % of the 
amount of direct insurance and assumed reinsurance premiums in effect in the last 12 months, 
multiplied by the existing retention ratio between claims net of reinsurance and total claims, which 
shall not be less than 85 %; and (b) a percentage betwe en 45 % and 72 % of the annual average for 
net claims for the last 36 months multiplied by the existing retention ratio between claims net of 
reinsurance and total claims, which shall not be less than 85 %. 
4.107.   The SSF determines the minimum fixed capital require ments for insurers and adjusts them 
every two  years subject to the opinion of the Central Bank. In November  2022, the minimum fixed 
capital requirements were: (a)  USD 1,447,984 if the insurer is engaged in general insurance; 
(b) USD 1,023,304 if engaged in  personal insurance; (c)  USD 830,188 if in bond operations; 
(d) USD 4,111,626 if in reinsurance and counter -guarantees; (e)  USD 2,470,745 if operating in all 
branches of insurance; and (f) USD  18,413 for insurance brokers. There are also minimum amounts 
for policy deposits (USD  10,507) and mathematical provisions (USD  8,341). Insurance companies 
are required to deposit the fixed capital in the Central Bank upon commencing operations.86 
4.108.   The Law continues to limit shareholding in insurance companies. At least  75% of the shares 
must be held, individually or collectively, by: (a) natural persons of Salvadoran or Central  American 
nationality;  (b) Salvadoran companies a majority of whose shareholders are natural persons of 
Salvadoran or Central  American nationalit y; or (c) Central American or other foreign insurance or 
reinsurance companies. Foreign companies outside the Central American area must be classified as 
first-grade institutions by internationally recognized risk rating companies, as documented by the 
SSF, and must in all cases operate in accordance with prudential regulations and supervision in their 
countries of origin. In addition, no shareholder may own more than 1 % of a company's capital 
without prior authorization from the SSF. That percentage must i nclude the appropriate number of 
shares attributable to them as shareholders in companies holding shares of the insurance company 
in question.87 Insurance companies must register their shares with a stock exchange established in 
the country.  
4.109.   To operate in El Salvador foreign insurers must secure a commercial presence by legally 
establishing a subsidiary in the country. Since the entry into force of the Law on Insurance 
Companies in 1997 the establishment of branches is no longer permitted, although branches  already 
operating at the time were able to continue doing so subject to their parent companies' compliance 
with the net worth requirement.88 The last remaining branch of a foreign insurer closed in 2021.  
4.110.   The cross -border supply of insurance services is no t permitted, but there are no restrictions 
on the use of insurance services abroad. Reinsurance contracts may also be concluded with foreign 
reinsurance companies or brokers outside El  Salvador if registered with the SSF.  
4.111.   Subject to prior authorization fro m the SSF, an insurance company can invest in shares of a 
Salvadoran company provided that: (a) the Salvadoran company operates in an insurance branch 
different from that of the investing company; (b) the Salvadoran company's insurance services 
directly co mplement those of the investing company; (c) the investing company owns or co -owns 
with another insurance company more than 50 % of the Salvadoran company (which is thus a 
subsidiary of the investing company or companies). Investments in foreign companies a re subject 
to the same requirements except that they are allowed for companies operating in the same branch. 
The subsidiaries and other companies in which such investments are made remain subject to 
SSF supervision and oversight. Funding for the establishm ent and operation of such companies must 
come from resources over and above the company's minimum net worth. The SSF can authorize the 
establishment of subsidiaries abroad only if subject to prudential supervision consistent with relevant 
 
86 Articles 4, 14 and 98 of Decree No.  844, SSF Instruction NPS1 -01 on establishing and operating 
insurance companies in El Salvador.  
87 Articles 6 -7 5 of Decree No.  844 and online information from the SSF. Viewed at: 
http://www.ssf.gob.sv/index.php/noticias/210 -temas/marco -legal/capsoc/102 -seguros -4235839 . 
88 Article 111 of Decree No.  844. WT/TPR/S/440  • El Salvador  
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  international pra ctice and local laws. Foreign subsidiaries can conduct transactions within the country 
only with their parent companies and if so authorized by the SSF.  
4.112.   Insurance companies are prohibited from: issuing negotiable bonds; pledging property or 
securities form ing part of their reserves or minimum net worth; issuing preferred stock or shares 
with limited voting rights; endorsing or guaranteeing loans; granting loans to related persons for 
the development or disposal of real estate; and lending in any way to thei r directors, managers or 
employees.  
4.113.   The SSF does not regulate the premiums charged for policies but does regulate policy 
models. For a company to offer an insurance product, its policy model must have been previously 
submitted to and approved by the SSF. T his requirement is waived for policies issued to legal entities 
with annual premiums in excess of USD  10,507. Policies must be sent to the SSF no later than five 
days after their signature.  
4.114.   The number of insurers operating in El Salvador as at May  2022 was  23, all of them private; 
14 were foreign -owned. Seven of the 23 dealt in general (casualty) insurance and 10 in life 
insurance, with six operating in both branches. The market remains highly concentrated: in 2021, 
60.5% of total premiums were taken by the  top five insurers and 84.8 % by the top 10. The number 
of insurance intermediaries registered with the SSF that year stood at 1,468, of which 1,372 were 
natural persons and 96 legal entities.89 As at March  2022, some 83.3 % of the shares of the insurance 
companies operating in El Salvador were held by Central American investors, with 16.7 % held by 
investors outside Central America.  
4.115.   Insurance companies took USD  826.2  million in premiums in 2021 (14.5 % more than in 
2020).90 The sector's penetration of the econ omy, as measured by premiums relative to GDP, 
remained stable during the review period (2.6 % of GDP in December  2021, compared to 2.5 % in 
December  2015).91 The density rate (per capita annual expenditure on insurance) rose from 
USD 94.20 in 2015 to USD  111.30 five years later in December  2020, amounting to an average 
annual increase of 3.4 %. Life insurance was the bestselling product during the review period (26.9 % 
of total premiums by December  2021, and 27.7 % by May  2022), followed by accident and sickness  
insurance and fire insurance.  
4.4.2.4   Securities market  
4.116.   There are 24 participants in El Salvador's securities market, including one stock exchange, 
10 brokerage firms, one central securities depository, three securitization companies, five  risk rating 
agencies an d four investment fund management companies. The minimum capital requirements 
established by type of institution, as of April  2022, were USD  565,552 for the stock exchange; 
USD 224,310 for brokerage firms; USD  210,444 for companies specializing in the depo sit and 
custody of securities; and USD  97,613 for risk rating agencies.92 
4.117.   The securities market in El Salvador is governed by the Securities Market Law93 and 
subsequent amendments thereto.94 This Law provides that all publicly offered securities as well as 
their issuers must be registered first with the SSF's Public Securities Registry and subsequently with 
an exchange. The State and the Central Reserve Bank of El Salvador, however, are exemp t from 
this requirement, as are the securities they issue, which can be publicly offered with no need for 
registration. There is no such exemption, on the other hand, for the State's decentralized 
autonomous institutions.  
 
89 Information provided by the authorities . 
90 Information provided by the authorities.  
91 Information provided by the authorities.  
92 Information from the SSF. Governing Board of the SSF, at session No.  CD-19/2022 of 25 April 2022. 
Viewed at: https://ssf.gob.sv/estadisticas/marco -legal-y-normativo/actualizaciones -parametros -legales/ . 
93 Legislative Decree No. 809 of 6 April 1994.  
94 Legislative Decrees No.  652 of 6 December 2001; No.  742 of 21 February 2002, containing the Law 
on Electronic Book -entry Securities; No.  692 of 24  July 20 08; No.  390 of 20 January 2011; and No.  792 of 
29 September 2014.  WT/TPR/S/440  • El Salvador  
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  4.118.   Another law of significance is the  Asset Securitization Law95, as amended in 2016 (with 
regard to limited liability companies, to improve competition), 2018 and 2019. This Law requires 
that securitization companies be established as corporations or fixed -capital limited liability 
companies  of indefinite duration, domiciled in El Salvador for the sole purpose of establishing, 
funding and administering securitization funds and issuing the securities they generate. The assets 
best suited to securitization are those yielding regular and predict able financial flows. They include 
loan contracts; securities; and dematerialized or book -entry securities and rights to future financial 
flows. The minimum share capital required to establish a securitization company is USD  1 million, 
which must be subscr ibed and paid up entirely in cash.  
4.119.   Bank-issued securities are regulated by provisions in the Banks Law and the Law on 
Cooperative Banks and Savings and Loan Societies. Negotiable bonds and other securities issued in 
series or tranches must be registered wi th the SSF's Public Securities Registry, and subsequently 
with an exchange.  
4.120.   Central American States and central banks, as well as regional and international financing 
agencies of which El Salvador or the Central Reserve Bank of El Salvador are members, can  publicly 
offer securities in El Salvador by applying through a brokerage for SSF authorization to do so. Once 
authorized, their securities must be registered with an exchange in the country. Securities issued by 
foreign States and institutions responsible  for administering monetary policy in countries other than 
those previously mentioned, as well as those issued by companies, corporations or legal entities of 
any kind, public or private, from any foreign country, can be publicly offered in the secondary 
market, subject also to prior registration, through a brokerage, with the Public Securities Registry, 
and subsequently with an exchange. As additional prerequisites they must also have registered with 
a regulatory or supervisory agency or have traded in an organized securities market with regulatory 
and supervisory requirements similar or superior to those of El Salvador – and in all cases must have 
a valid international risk rating.  
4.121.   The El Salvador Stock Exchange (BVES) is a private institution that forms p art of the 
securities market. The BVES opened in April  1992 and seeks to facilitate the flow of savings and 
investment in the capital market, while promoting the free setting of prices, transparency and 
liquidity in operations. As a marketplace for stocks,  debt instruments and other financial instruments, 
the BVES channels surplus resources into business financing. It provides the infrastructure, 
supervision and services required for the issuance, placement and exchange of registered securities 
and is respo nsible for the public dissemination of stock market information. The BVES manages 
operations and keeps the Central de Depósito de Valores S.A. de C.V . (Central Securities Depository 
Variable Capital Corporation or CEDEVAL) informed about them. It also supe rvises the activities of 
stock-issuing companies and brokerages. Its main objectives are to facilitate the flow of savings and 
investment in the capital market; carry out the primary placement of securities market instruments; 
promote the free setting of p rices and transparency in operations; and foster measures that promote 
liquidity at market prices in the secondary market.96 
4.122.   The BVES provides a platform for three different markets: primary, secondary and repo. The 
primary market is where securities are initially placed. Through the intermediary of brokerage firms, 
investors acquire directly from issuers securities offered to the public for the first  time, and issuers 
receive payment directly from those investors. Subsequent sales of the sa me securities take place 
in the secondary market, once they have been negotiated in the primary and/or secondary market. 
The entire negotiating process takes place through brokerage firms. In the repo market, securities 
are transferred temporarily (for bet ween two and 45 days) as guarantees for short -term loans, 
through what are called repurchase or "repo" transactions.  
4.123.   Among all the operations negotiated in the BVES, participation is greatest in the repo market. 
At the end of 2021, transactions totalled US D 3,665.5  million, of which the repo market accounted 
for 35.3 %, the primary market for 33.9 %, and the secondary market for 22.7 %, with the rest 
 
95 Legislative Decree No. 470 of 15 November 2007.  
96 Information from the BVES. Viewed at: https://www .bolsadevalores.com.sv/index.php/la -bolsa/la -
bolsa-de-valores . WT/TPR/S/440  • El Salvador  
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  consisting of international transactions. Total transactions during the first nine months of 2022 
amounted to U SD 2,058.9  million.97 
4.124.   There are currently nine investment funds authorized by the SSF: seven open and 
two closed. As at September  2022, the value of the open funds amounted to USD  181.7  million and 
that of the closed funds to USD  250.7  million. The value o f all funds totalled USD  432.4  million.98 
4.125.   Some securities are negotiated in an integrated El Salvador -Panama Stock Market. This 
integration arose from agreements signed by the stock exchanges of both countries, in coordination 
with their respective supervi sory authorities, in September  2015. With a capitalization of more than 
USD 9 billion in trading volume, this integrated market conducts business through remote operators, 
permitting brokerage firms to participate in the various operations in both markets without an 
intermediary. Duly authorized brokerage firms (CCB El Salvador) or exchange posts (PV  Panama) 
can enter the systems of both exchanges, through the remote operators, and conduct their 
negotiations remotely. These integrated exchanges are also lin ked with their respective central 
security depositories for the purposes of compensation, liquidation, registration and custody related 
to security transactions.99 
4.126.   There are now 11 authorized foreign securities exchange intermediaries: six  Salvadoran and 
five Panamanian. As at June  2022, 290 transactions had been recorded totalling USD  38.8 million. 
Of that total, 92.4 % were negotiated by Salvadoran operators. Transactions negotiated from the 
start of integration in 2017 up to June  2022 totalled USD  325.8  million.100 
4.4.3   Telecommunications  
4.4.3.1   Main features  
4.127.   The telecommunications sector (together with information activities) accounted for 2.9% of 
GDP in 2021. During the period under review, the telecommunications sector continued to develop 
and was one of the best pe rforming sectors of the Salvadoran economy.  
4.128.   The country's telecommunications indicators followed a positive trend during the review 
period. In the second quarter of 2022, mobile telephone lines totalled 11.6 million (9.6 million in 
2016), 89% of which were  prepaid. Mobile telephone density reached 183.3% per 100 inhabitants 
in the second quarter of 2022, one of the highest in Latin America and the Caribbean. Meanwhile, 
with just under 859,000 lines, fixed telephone density was 13.6% in the second quarter of  2022, 
reflecting the progressive replacement of this type of telephony by mobile alternatives. Wireless 
broadband subscriptions increased from 505,300 in 2016 to almost 823,000 in the second quarter 
of 2022. The average download speeds for broadband Inter net increased substantially, reaching 
38.66 Mbps for fixed broadband and 33.51 Mbps for mobile connections, according to data for the 
second quarter of 2022.101 During the period under review, there was a trend towards the reduction 
of tariffs for telecommu nication services in the market.  
4.129.   At the end of 2016, 4G technology reached El Salvador; relatively late compared to other 
countries in the region. This is partly explained by the lack of availability of suitable radio spectrum. 
However, in recent years the  telecommunications regulator has allocated new spectrum bands 
through public auction (and has renewed or extended existing concessions), thus allowing operators 
to deploy 4G technology. It is therefore hoped that 4G lines will account for around 30% of th e total 
in 2022. The authorities have indicated that El  Salvador will begin implementing 5G  technology in 
the near future.  
4.130.   El Salvador's telecommunications regime is essentially open and allows for foreign 
investment. In 2022, the market comprised 12 fixed  telephony operators, 5 mobile telephone 
 
97 BVES, Estadísticas por mercado . Viewed at: https://www.bolsadevalores.com.sv/index.php/precios -y-
estad isticas/estadisticas -por-mercado . 
98 SSF, information provided during the WTO visit in June 2022.  
99 Information from the BVES. Viewed at: https://www.bolsadevalores.com.sv/index.php/participantes -
del-mercado/integracion -de-los-mercados . 
100 SSF, information provided during the WTO visit in June 2022.  
101 The information in this paragraph was provided by SIGET. For more information see: 
https://www.siget.gob.sv/gerencias/telecomunicaciones/estadisticas/indicadore s/. WT/TPR/S/440  • El Salvador  
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  operators, and 45 Internet service providers (ISPs). Operators may offer various integrated services 
(e.g. fixed and mobile telephony, Internet and cable television). In the mobile segment, which is 
one of the most competitive in the sector, the main operators during the period under review were: 
Claro (América Móvil Group), Tigo (Milicom Group), Movistar (Telefónica Group) and Digicel 
(Digicel  Group). In October 2021, Movistar was acquired by General International T elecom Limited, 
a British investment fund.102 The fixed telephony segment remains concentrated, with Claro 
continuing to hold a share of more than three quarters of the market.103 Under Article 24 of the Law 
on Access to Public Information, data on the marke t share of each telecommunications operator are 
declared confidential at the request of the interested parties. With regard to the broadcast media 
segment, this consists of multiple privately -owned, national terrestrial television networks, as well 
as cabl e television networks that transmit international channels and hundreds of commercial radio 
stations. During the review period, Telemóvil (Tigo) acquired the cable television company 
Grupo  Caribeña, which operated in some municipalities in the eastern area  of the country.  
4.4.3.2   Institutional and regulatory framework  
4.131.   The General Supervisory Authority for Electricity and Telecommunications (SIGET) is the 
sector's regulatory body, tasked with overseeing compliance with telecommunications regulations. 
SIGET is an autonomous public service institution, with its own legal personality and assets, and 
interacts with other state bodies through the Ministry of Economic Affairs, to which it is attached and 
reports annually. SIGET's main responsibilities include implementi ng international treaties, 
telecommunications laws and regulations and detecting non -compliance, managing the radio 
spectrum and numbering plan, approving the maximum basic rates for some fixed and mobile 
telephony services and interconnection charges, res olving disputes between telecommunications 
operators, and representing the country in international organizations related to the sector. SIGET 
does not have the power to initiate legislation.  
4.132.   SIGET is charged with promoting competition in the sector and wo rks in coordination with 
the Supervisory Authority for Competition, which is responsible for conducting investigations on 
anti-competitive practices in the telecommunications market, and with the Consumer Ombudsman, 
which monitors that service users' right s are respected. The institutional framework also includes 
the Secretariat for Innovation of the Office of the President, created in 2019, which has developed 
the National Connectivity Plan as part of the National Digital Agenda 2020 -30. The general object ive 
of the Plan is to increase the Salvadoran population's access to fixed and mobile broadband services 
and the potential for public services to be provided online. The specific objectives are to: (i) improve 
access to connectivity through investment in d igital infrastructure and institutional strengthening; 
and (ii) reduce the digital skills and competencies gap in order to increase Internet use by the 
Salvadoran population.  
4.133.   The regulatory framework mainly comprises of the Law on Telecommunications104 and its 
implementing regulations105, and the Law establishing the General Supervisory Authority for 
Electricity and Telecommunications (LCSIGET)106 and its implementing regulations.107 The Law on 
Telecommunications establishes the general framework for the granting of concessions for fixed and 
mobile telephony services and for the management of the radio spectrum, as well as the rights and 
obligations of service operators and users. Amo ngst other principles, the Law on Telecommunications 
incorporates the principles of technological neutrality and free competition. The LCSIGET establishes 
the composition, functions and duties of the regulatory body.108 In 2018, the Regulations for the 
Quality of the Public Telephone and Data Transmission Service were approved, which establish 
parameters, indicators and procedures for assessing the quality of these services.  
 
102 In 2020, the Supervisory Authority for Competition rejected the bid by America Móvil Group to 
acquire Movistar, after which the Group abandoned the acquisition plan.  
103 Ibero -American Telecommunications Organization (OTI). Viewed at: 
https://otitelecom.org/documentos -de-inteligencia/estadistica s/estadisticas -el-salvador -telefonia -tv-
restringida/ . 
104 Legislative Decree No. 807 of 12 September 1996 and amendments thereto (last amended in 2019).  
105 Executive Decree No. 84 of 15 July 2011 and amendments thereto (last amended in 2019).  
106 Legislative De cree No. 808 of 12 September 1996 and amendments thereto (last amended in 2021).  
107 Executive Decree No. 56 of 13 May 1998 and amendments thereto (last amended in 2012).  
108 SIGET is headed by a Superintendent and an Executive Board, mainly appointed by the P resident of 
the Republic.  WT/TPR/S/440  • El Salvador  
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  4.134.   During the review period, the Law on Telecommunications was subject to a number of 
amendments and additions. In 2016, amendments were introduced to regulate the allocation of 
radio frequencies and to establish alternative mechanisms to public auction, such as public tender. 
Some of SIGET's powers relating to the reorganization of the radi o spectrum were also redefined 
and it was given discretionary powers to request opinions from the Supervisory Authority for 
Competition on transactions in the secondary market for spectrum operating rights, and on the 
involvement of some agents in the proc ess of granting spectrum operating concessions. Opinions, if 
requested, are binding on SIGET. The amendments introduced in 2018 and 2019 were primarily 
aimed at strengthening the protection of user rights, clarifying and reinforcing the obligations of 
telecommunications operators (including prohibitions), strengthening the sanctions regime for 
non-compliance, and adapting regulations to technological developments in the area of 
telecommunications generally.  
4.135.   Within the WTO, El Salvador adopted commitments on  telecommunications in the Uruguay 
Round and subsequently extended them by accepting the Fourth Protocol to the General Agreement 
on Trade in Services.109 Additionally, El Salvador assumed the obligations contained in the Reference 
Paper on Basic Telecommun ications.  
4.136.   Pursuant to the Law on Telecommunications, operators wishing to offer telecommunications 
services in El Salvador must register as commercial telecommunications network operators.110 
Telephony is considered a public service. Those interested in pro viding fixed and mobile telephony 
services, and are already registered as operators, must apply to SIGET for a concession. Concessions 
are granted for a period of 30 years, with no limitations on the number of users or geographical 
location. It should be n oted that these concessions do not confer any rights over the radio spectrum. 
There are no nationality requirements for obtaining a public telephony service concession.111 In order 
to provide Internet services, the only requirement is registration in the re gister of commercial 
telecommunications network operators.  
4.137.   Radio and television broadcasting services require a concession, which is granted only to 
natural persons who are Salvadoran by birth, or legal persons whose share capital comprises at least 
51% Sa lvadoran capital.112 To provide a subscription television broadcasting service, which does not 
use the radio spectrum, a licence must be requested from SIGET. The licence is granted for the 
transmission of domestic and foreign audio -visual channels, provide d that the applicant has the 
permission of the owners of the channels it will transmit.  
4.138.   Regarding the radio spectrum, the Law on Telecommunications provides that this resource 
is owned by the State and charges SIGET with its management. To that end, the ra dio spectrum is 
classified into three categories: free, official and regulated use. The free use spectrum includes the 
frequency bands that may be used by the general public to operate radio stations, which does not 
require a concession, but may require a licence. The official spectrum is reserved for the exclusive 
use of state institutions, subject to authorization by SIGET. The regulated spectrum includes all the 
frequency bands that the law has not designated for free or official use and that require a c oncession 
from SIGET.113 
4.139.   Concessions to use the regulated spectrum are awarded through direct allocation methods, 
public auction, and public competition.114 Concessions are granted for 20 years, except for the 
satellite service spectrum, the duration of whic h is specified in the contract. Concessions may be 
renewed at the request of the holder, who must initiate the procedure three to two years before the 
concession expires and pay the fee.115 Operators are obliged to use the spectrum granted and that 
use is m onitored by SIGET. Operators may transfer or lease the frequencies granted, subject to 
 
109 WTO documents GATS/SC/29 and GATS/SC/29/Suppl.1, of 15 April 1994 and 11 April 1997, 
respectively.  
110 In July 2022, there were 495 companies in SIGET's register.  
111 Article 7 of the Law on Telecommunications.  
112 Article 123 of the Law on Telecommunications.  
113 Article 12 of the Law on Telecommunications.  
114 Article 78 of the Law on Telecommunications. Direct allocation applies to the shared regulated 
spectrum (fixed service stations, such as microwave links); public auctions apply to the exclusive regulated 
spectrum (radio stations in general); and tenders (stations providing broadcasting services to the non -profit 
community).  
115 Beginning in 2017, concessions that had been granted years earlier began to expire and SIGET 
proceeded to au thorize a substantial number of renewals.  WT/TPR/S/440  • El Salvador  
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  authorization by SIGET and provided they meet the requirements stipulated in the Law. There were 
63 subscription television licensees and 11 telephony licensees in 2022.  Concession, authorization 
and licence fees are paid annually to SIGET.  
4.140.   Operators are free to negotiate among themselves the prices and conditions of 
telecommunication services, except for those services considered to be essential resources116, such 
as inte rconnection, and those classified as public utilities, such as fixed and mobile telephony 
services. SIGET is responsible for setting maximum interconnection charges between fixed and 
mobile network operators, as well as the maximum fixed and mobile tariffs . Each year, SIGET carries 
out a review of the above -mentioned tariffs and charges, and issues a resolution with the updated 
tariffs and charges, which is published in the Official Journal. The authorities have indicated that 
these tariffs and charges rema ined consistent during the review period.  
4.141.   The general obligation to provide access is set forth in Article 20 of the Law, which requires 
any operator of commercial telecommunications networks to provide access to essential resources 
to whoever requests it for a fee and without discrimination. Similarly, fixed network 
telecommunications service providers must not impose discriminatory or unreasonable prices or 
terms and conditions for access to those services. There is no obligation to adopt a model 
intercon nection contract. In the event of a disagreement between operators regarding the technical 
conditions of access, the parties may ask SIGET to resolve the conflict.117 The implementing 
regulations of the Law on Telecommunications set out detailed provisions on the different aspects of 
interconnection between operators.  
4.142.   Following the promulgation of the relevant regulations118, number portability came into effect 
in August 2015. Operators must port the number within a maximum of one working day for mobile 
numbers and three working days for fixed -line numbers, at no cost to the user. The authorities have 
indicated that, between January 2016 and June 2022, 1,228,210 mobile numbers and 168,620 fixed 
numbers were ported.  
4.143.   During the review period, the Supervisor y Authority for Competition (SC) conducted an 
investigation following a complaint regarding anti -competitive practices in the national and 
international calls termination market. In September 2019, the SC issued its final ruling, in which it 
stated that th e company under investigation had abused its dominant position by impeding the entry 
of new competitors or the expansion of existing ones in the market. The SC proceeded to impose a 
fine of USD 375,000 on that company. It also ordered the company to comply  with certain business 
practices and issued recommendations to SIGET in order to prevent and combat proven 
anti-competitive practices.119 
4.144.   The Law on Telecommunications does not provide for the creation of a universal fund as 
such. However, there is the Nati onal Electricity and Telephony Investment Fund (FINET), which has 
the purpose of subsidizing the supply of telephone services (and electricity) in rural and low income 
areas, provided that these benefit the community.120 FINET is financed by contributions f rom the 
State and the income generated by concessions and licences for telecommunications services and 
the radio spectrum, as well as the income derived from concessions for electricity generation.  
4.4.3.3   Digital Agenda and technological innovation programmes  
4.145.   The Digital Agenda and Digital Nation projects have been developed as part of El  Salvador's 
strategic plans and policies.  
4.146.    The Digital Agenda seeks to achieve the 17 Sustainable Development Goals (SDGs). The 
Digital Agenda is structured around four areas of w ork: (a) digital identity; (b) innovation, education 
and competitiveness; (c) modernization of the State; and (d) digital governance. The digital identity 
 
116 Article 19 of the Law on Telecommunications lists the resources considered essential.  
117 The procedure for settling disputes over access to essential resources is established in Articles 86 -93 
of the Law.  
118 Execut ive Decree No. 58 of 18 September 2014.  
119 Supervisory Authority for Competition. Viewed at: 
https://www.sc.gob.sv/index.php/project/denuncia -por-supuestas -practicas -anticompetitivas -dentro -del-
mercado -de-la-terminacion -de-llamadas -nacionales -e-internacionales -sc-036-d-pi-r-2017/ . 
120 Legislative Decree No.  354 of 9 July 1998, as amended by Legislative Decree No.  808 of 2007.  WT/TPR/S/440  • El Salvador  
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  pillar seeks to promote the technological and institutional development of the National Registry of 
Natural Persons (RNPN), for the centralized and standardized management of the civil and identity 
register for natural persons; to consolidate digital identity and electronic signature services based 
on the national identity number; and to ensure consolidat ed management of citizens' data on their 
interaction with state services, which facilitates the management of and access to the information 
needed to improve the delivery of services and simplify processes.  
4.147.   In the area of innovation, education and competit iveness, the aim is to create a multi -sector 
integration system to boost technology education, competitiveness and access to broadband 
services; and mechanisms to promote entrepreneurship by boosting employability, and through an 
innovation ecosystem and t rade supported by information and communications technology (ICT) to 
narrow the digital divide. Actions under this pillar include: promoting innovation through research 
and development in technology; designing and deploying the telecommunications network 
infrastructure needed to connect the entire country, deliver digital public services, and foster the 
conditions to promote e -commerce and a knowledge economy; carrying out training programmes 
for the management and delivery of digital services by the public  administration; promoting the use 
of technology to meet people's day -to-day needs; implementing training programmes to take 
advantage of new digital services, narrow the digital divide, and meet market demands within the 
framework of a digital economy; fo stering financial innovation to facilitate doing business and 
completing formalities, by boosting access to banking and financial inclusion; and improving digital 
inclusion through ICT.  
4.148.   Actions under the modernization of the State pillar include replacing physical documents with 
electronic documents, and projects such as e -invoicing, the standardization and digitalization of the 
Executive's records, the exchange of data through the National Interoperability Platform, and the 
publication of open data and up -to-date statistics. In the area of digital governance, the aim is to 
foster a legal framework that protects rights, and ensures privacy and security online. To this end, 
the intention is to establish regulations and guidelines for cybersecurity and the ado ption of 
measures to protect the environment, to encourage the production and consumption of renewable 
energy, and to regulate the management of technological waste.121 
4.149.   Meanwhile, the Digital Nation project aims to make El Salvador a regional model for 
attracting investment and a development hub for the export of digital and technological services, 
taking advantage of the human talent potential. To this end, actions, programmes and projects are 
being carried out that seek to strengthen three approaches: bitc oin ecosystem, tech outsourcing 
and artificial intelligence. These approaches are underpinned by six pillars of work, which in turn 
have their own objectives. The pillars being worked on in conjunction with other institutions are: 
(1) human talent, in orde r to develop the digital skills sought by businesses, promote the 
international certifications required to enter the labour market, and connect human talent to 
employment opportunities in the industry; (2) regulatory framework, through which legal certaint y 
and incentives for investment and exports are provided, with a view to amending the legal framework 
for contractual commercial e -transactions carried out by digital, electronic and technologically 
equivalent means, through amendments to the Law on Trade,  and to promoting startups through a 
new Startups Law; (3) innovation and technology, through which innovative infrastructure for 
education, research and digital development is provided; (4) financial solutions, through which 
innovative financial products are extended to both the sector and the population in general; 
(5) market access and positioning, by boosting exports, highlighting trade opportunities and 
expanding market access; and, lastly, (6) promoting and attracting investment, by developing 
opportu nities for current and potential investors, and supporting them in efforts to set up, expand 
and consolidate their investments.  
4.4.4   Transport  
4.4.4.1   Main features  
4.150.   The transport and storage sector generated USD 1,279 million in 2021, an increase of 8.9% 
compared to 20 16. The sector's contribution to domestic GDP averaged 4.5% during the period 
 
121 Innovation Secretariat, Digital Agenda of El Salvador 2020 -30. Viewed at: 
https://www.innovacion.gob.sv/downloads/Agenda%20Digital.pdf . WT/TPR/S/440  • El Salvador  
- 125 - 
  under review.122 In 2021, foreign direct investment (FDI) in the transport sector was 
USD 258.1  million, up by 425.67% compared to 2016. The sector employed some 108,215  people 
in 2019.123 In 2021, the value El Salvador's foreign trade (imports plus exports), by mode of 
transport, was as follows: land, USD 14,053.84 million; maritime, USD  6,204.72  million; and air, 
USD 1,446.11 million.124 
4.151.   The Ministry of Public Works and Transport ( MOPT) is the institution responsible for planning 
and implementing public works and the smart management of transport, including the rail transport 
system.125 The Office of the Deputy Minister for Transport, attached to the MOPT, is responsible for 
planning  and implementing sectoral policy. In particular, it is responsible for regulating land and 
freight transport, overseeing the public transport system and managing transit. The sector's 
institutional framework comprises three other state agencies: the Marit ime Port Authority (AMP), 
which is responsible for the technical and economic regulation of maritime and port activities; the 
Civil Aviation Authority (AAC), which is responsible for monitoring and regulating air transport; and 
the Executive Autonomous Por ts Commission (CEPA), an autonomous public institution with legal 
personality, responsible for port and airport infrastructure, and air navigation services.  
4.152.   The Government's Cuscatlán Plan recognizes the importance of connectivity for the country's 
economi c and social development. The Public Infrastructure Plan  2019-24 has a number of strategic 
priorities that will have a direct impact on the transport sector, namely: (i) roads; (ii) transportation; 
(iii) ports, airports and customs; and (iv) public -private  partnerships.126 Furthermore, El Salvador's 
Master Plan for Infrastructure 2019 -30, prepared with the support of the Inter -American 
Development Bank (IDB), proposes a portfolio of short -, medium - and long -term, multi -sectoral 
infrastructure projects amount ing to USD 8.5 billion, 60% of which will be allocated to transport.127 
4.153.   Under the Cuscatlán Plan, one of the main objectives of the Government of El Salvador is to 
diversify public investment strategies through the public -private partnership mechanism as an  
alternative to long -term investment in infrastructure and services, and as a means of sharing 
financial risk with the private sector.128 In this connection, a new legal framework governing the 
modality of public -private investment was adopted during the re view period, and will enable the 
public sector to concentrate its direct investments in sectors with a greater social impact, such as 
health and education.  
4.4.4.2   Maritime transport and ports  
4.154.   In 2021, El Salvador's ports handled 7.6 million metric tonnes (15% more than in 2016), of 
which 6.3 million were imports and 1.3 million exports. In value terms, 59% of imports and 36% of 
Salvadoran exports were moved by sea in 2021.129 
4.155.   The Executive Autonomous Ports Commission (CEPA), established under the Organic Law of 
the Executive Autonomous Ports Commission, is responsible for the administration, operation, 
management and execution of port operations of all port facilities in El Salvador, as well as the 
custody, handling and storage of exported and imported goods.130 In addition to managing port 
infrastructure, in its capacity as port operator, CEPA proposes the port charges applied for the 
performance of port logistics services131, which must be approved by the AMP. Amendments to the 
 
122 Online information from the database of the Central Reserve Bank of El Salvador. Viewed at: 
http://www.bcr.gob.sv . 
123 Information provided by the authorities.  
124 Information provided by the authorities.  
125 Legislative Decree No. 360 of 26 April 2022.  
126 Government of El Salvador, Cuscatlán Plan, Fomento y Obras Públicas, Infraestructura . Viewed at: 
www.plancuscatlan.com . 
127 IDB, Plan Maestro de Infraestructura de El Salvador 2019 -30. Viewed at: 
https://publications.iadb.org/publications/spanish/document/Plan_maestro_de_infraestructura_de_El_Salvador
_Un_i nstrumento_de_planeaci%C3%B3n_de_infraestructura_multisectorial_a_largo_plazo_que_permitir%C3%
A1_potenciar_el_desarrollo_econ%C3%B3mico_y_social_de_El_Salvador.pdf . 
128 Government of El Salvador, Cuscatlán Plan, Fomento y Obras Públicas, Infraestructura . Viewed at: 
www.plancuscatlan.com . 
129 Information provided by the authorities.  
130 Legislative Decree No. 455 of 21 October 1965.  
131 Charges are governed by the General Maritime Port Law and the special regulations for the 
application of port service charges.  WT/TPR/S/440  • El Salvador  
- 126 - 
  list of charges for administrativ e services provided by the AMP in the port and maritime fields were 
published in the Official Journal in October 2017 and November 2018, respectively.  
4.156.   El Salvador has two commercial seaports managed by the State through CEPA: the Port of 
Acajutla, located in the western area of the country (some 195 km from the border with Guatemala) 
and the Port of La Unión, located on the Gulf of Fonseca, on the border with Honduras. The Port of 
Acajutla is the country's largest port; in 2021, practically all maritime car go was handled there, with 
an average of 459,000 metric tonnes moved monthly.132 Of the merchandise transported, 62% was 
bulk cargo, while the remaining 38% comprised containerized (29%) and general cargo (9%). 
El Salvador does not have its own merchant fle et.133 
4.157.   The volume of operations of the Port of La Unión is much more limited.134 During the period 
under review, and given the low demand on this port, CEPA has drawn up a concession project for 
the Port of La Unión, which is in the process of being presente d to investors and world -class port 
operators.  
4.158.   There is a third port, CORSAIN, administered by the Salvadoran Investment Corporation (an 
autonomous state entity), which handles mainly tuna -fishing boats and merchant vessels carrying 
liquefied petroleum gas  (27,000 tonnes and 330,000 tonnes were unloaded in 2021, respectively).135 
4.159.   The Port of Acajutla and Port of La Unión have a Development Master Plan for 2020 -30, 
which aims to boost strategic logistics infrastructure projects, develop new business centres a nd 
create jobs. In this regard, a modernization and development project for the Port of Acajutla was 
drawn up during the period under review, with the aim of increasing the port's operational capacity, 
improving infrastructure, increasing installed capacit y (from 350,000 TEU to 910,000 TEU) and 
building a new terminal. The Port of Acajutla list of charges, which is valid for five years, was 
published on 26 January 2022.136 
4.160.   During the period under review, the activities necessary for the launch of the "Bicent ennial 
Route" ferry project, including the overhaul of port infrastructure at the Port of La Unión, the signing 
of the Memorandum of Understanding between the Government of El Salvador and the Government 
of Costa Rica, and the agreements for the implementa tion of the commercial tariff policy for ferry 
ships at Caldera Port (Costa Rica) and the Port of La Unión, were launched. The aim of this project 
is to connect El Salvador with other Central American ports to provide an alternative maritime route 
to land freight transport. The first phase of the project, jointly funded by CEPA and the Central 
American Bank for Economic Integration (CABIE), covers the route between Caldera Port and the 
Port of La Unión.137 The ferry service list of charges is already availab le on the CEPA website.138 
4.161.   Maritime transport is mainly governed by the General Maritime Port Law (LGMP)139, which 
established the AMP as the regulatory body for the subsector. Since the last trade policy review, the 
2018 Law on the Concession of Areas of Ma ritime -Terrestrial Public Domain was enacted, which sets 
out the procedures, conditions, time frame and other requirements for obtaining a concession for 
areas of maritime -terrestrial public domain.140 Pursuant to the new Law, the AMP is the entity 
responsi ble for conducting the technical, economic and financial analysis of the projects submitted 
by individuals, while the MOPT is responsible for preparing the concession rules and managing the 
related tendering procedure. Concessions for areas of maritime -terrestrial public domain must be 
approved by the Legislative Assembly. The concession may be for up to 50 years, which may be 
extended, and projects are classified into three categories: (i) category A (private port operation 
 
132 CEPA, Anuario Estadístico 2021 . Viewed at: 
https://www.transparencia.gob.sv/system/documents/documents/000/490/770/original/Anuario -Estadistico -
2021_-_PUERTO_ACAJUTLA.pdf?1652740967 . 
133 Information provided by the authorities.  
134 In 2021, the Port of La Unión moved 6,457.23 tonnes of bulk cargo. Viewed at: 
https://www.transparencia.gob.sv/institutions/cepa/documents/463768/download . 
135 Information  provided by the authorities.  
136 Viewed at : https://www.cepa.gob.sv/descargas/ . 
137 Ministry of Public Works and Transport, Memoria de Labores  2020-21. Viewed at: 
https://www.mop.gob.sv/logros -y-memoria/ . 
138 CEPA, Proyecto Ferri "Ruta del  Bicenten ario". Viewed at: www.cepa.gob.sv/proyecto -ferry/ . 
139 Legislative Decree No.  994 of 1 October 2002 (last amended on 29 July 2014).  
140 Pursuant to the Law, " maritime -terrestrial public domain" is defined as the territorial sea, its 
shoreline, natural resources, the continental shelf, and inland and continental waters.  WT/TPR/S/440  • El Salvador  
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  with investment of more than USD  1 million or with a capacity to handle merchant vessels for 
commercial or industrial purposes); (ii) category B (projects outside category A, except for projects 
worth less than USD 100,000); and (iii) category C (projects worth less than USD 100,000).  
4.162.   In the framework of the WTO, El Salvador's Schedule of Specific Commitments annexed to 
the General Agreement on Trade in Services does not contain any specific commitments affecting 
the maritime transport subsector.  
4.163.   The provision of national cabotage service s by foreign vessels is not restricted in El  Salvador. 
There are also no restrictions on foreign companies operating ports under concessions or providing 
ancillary port services, such as cargo handling and warehousing. The companies providing the 
services must obtain the relevant authorization from the AMP. Pilotage and towing services are 
reserved to the State.  
4.164.   Pursuant to the LGMP, the Salvadoran Maritime Registry (REMS), an organizational unit of 
the AMP, was created. Vessels, technical characteristics a nd equipment, contracts and any other 
relevant information must be entered in the register. To register a vessel in the REMS, the owner 
must be domiciled in the country (if a natural person) or must have been established in accordance 
with Salvadoran law ( if a company). If the company was established abroad, it must be represented 
in the country.141 
4.165.   El Salvador does not have any cargo allocation agreements with other countries, nor is it a 
party to the United Nations Convention on a Code of Conduct for Liner  Conferences. Within the 
Central American Integration System (SICA), El Salvador is a member of the Central  American 
Commission on Maritime Transport (COCATRAM), a specialized technical body that promotes the 
harmonization of maritime transport protocols i n the region. The Commission 's objective is to boost 
the development and efficiency of the subsector, and to improve member countries' external trade 
and integration into global maritime trade.142 
4.166.   El Salvador is a member of the International Maritime Organization (IMO) and a signatory 
to various international treaties administered by the Organization. However, the country has not yet 
ratified the International Convention for the Safety of Life at Sea (SOLAS Convention). According to 
the author ities, the internal consultation process is in its final stage and, provided there are no 
objections, the Convention will be submitted to the Legislative Assembly for examination and 
ratification.  
4.4.4.3   Air transport  
4.167.   In 2021, 35,076 tonnes of goods were transpor ted by air, of which 16,041 tonnes were 
imports and 19,034 tonnes were exports, totalling USD 1,446.11 million.  
4.168.   El Salvador's main airport is Saint Óscar Arnulfo Romero y Galdámez International Airport 
(AIES -SOARG), located in the department of La Paz. Thi s airport receives practically all of the 
country's international traffic and is the only one providing freight transport services. From January 
to August 2022, passenger traffic (including transfers and transits) was 2.3 million passengers, and 
20,162 ton nes of cargo were moved.143 Passenger flows at this airport continued to grow over the 
last decade (until the outbreak of the COVID -19 pandemic), which led to the expansion of the 
passenger terminal at a total cost of USD  45.3 million during the period unde r review. The new 
terminal has a capacity of 5 million passengers per year. Aircraft repair services are also provided 
at the International Airport.  
4.169.   In accordance with the new Special Law on Public -Private Partnerships, the first 
public -private partnership  was concluded during the review period to expand the AIES -SOARG cargo 
terminal, with foreign investment of USD 57 million and a 35 -year concession contract. Within the 
first phase of this project, an investment of USD 13 million is being spent to upgrade,  refurbish and 
maintain the current cargo terminal. When installed capacity reaches 52,000 tonnes, the second 
phase will start, involving an investment of USD 44 million, and will consist of the construction and 
 
141 Articles 40 -45 of the General Maritime Port Law.  
142 The members are C osta Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama.  
143 CEPA, Statistics January –August 2022. Viewed at: 
https://www.transparencia.gob.sv/institutions /cepa/documents/508077/download . WT/TPR/S/440  • El Salvador  
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  maintenance of a new cargo terminal with an installed capacity of 73,000 tonnes. It is hoped that 
this project will strengthen El Salvador's position as an aviation and logistics hub in the region.  
4.170.   The second airport in the country is Ilopango International Airport, which is used for military 
and ci vil purposes. Their passenger and cargo data are much more modest than those of 
AIES-SOARG. Ilopango Airport went from handling passenger traffic (including transfers and 
transits) of 18,252 passengers in 2016 to 3,775 passengers in 2020 as a result of the  COVID -19 
pandemic. According to the authorities, this airport can be used as an alternative to AIES -SOARG 
and other airports in the region, it also has the potential to become an aeronautical cluster given its 
close proximity to the main industrial centre s in the area.  
4.171.   The administration and operation of both airports is carried out by the State through CEPA, 
which is also responsible for planning and executing, directly or through contractors, the construction 
of new facilities and all works necessary for  the expansion and upgrading of existing airport 
facilities.144 CEPA also controls and directs air navigation support services.145 
4.172.   In 2022, the feasibility study required to launch the new Pacific International Airport 
construction project in the eastern are a of the country was completed. The aim of this project is to 
make the eastern area a hub for economic development, to create greater demand among 
passengers abroad, to develop international tourism and to promote the Port of La Unión.146 
In April 2022, the  Law for the Construction, Administration, Operation and Maintenance of the Pacific 
International Airport was adopted, which declares the construction of the airport to be "necessary, 
in the public interest and the highest priority". The Law also stipulate s that CEPA shall be the 
authority responsible for planning, constructing, operating and administering the new airport, and 
provides for tax exemptions for companies involved in the construction phase and, for a period of 
25 years, in the commissioning, ma intenance and operational phase.147 
4.173.   Air transport in El Salvador is governed by the Civil Aviation Organic Law148, which regulates 
the exploitation and use of the country's airspace with regard to air transport services. The 
regulatory framework is supplemen ted by the technical regulations of the Civil Aviation Authority 
(AAC), an autonomous institution in the subsector, responsible for regulating and monitoring all civil 
aviation activities, including air transport, auxiliary services, and licensing.  
4.174.   Pursuan t to the Civil Aviation Organic Law, the air fares and freight charges of passenger, 
freight and mail civil aviation activities, both domestic and international, are set freely by air 
transport operators, based on market conditions. Air transport operators  must register their fares 
with the AAC, clearly indicating any restrictions, conditions offered and validity periods. In the event 
that competitive conditions do not exist in the market, the AAC may temporarily set minimum and 
maximum fares for domestic a nd international air transport, subject to a favourable and binding 
opinion of the Supervisory Authority for Competition (SC).149 In the case of airport charges, the AAC 
has the authority to set charges and airport fees for services when competitive conditi ons do not 
exist. The AAC must also seek the opinion of the SC in this case.150 The current list of charges for 
AIES-SOARG came into force in January 2011.151 
4.175.   In accordance with the Investment Law, El Salvador does not apply restrictions on foreign 
investmen t for the purposes of commercial presence in El Salvador. Similarly, there are no 
restrictions on foreign companies holding a stake in Salvadoran airlines. However, air cabotage is 
reserved exclusively to companies in El Salvador, unless there is an intern ational treaty providing 
for the principle of reciprocity.  
 
144 Article 2 of the Organic Law on the Autonomous Port Executive Commission.  
145 Article 46 of the Civil Aviation Organic Law.  
146 Online information from CEPA. Viewed at: www.cepa.gob.sv/aeropuerto -del-pacifico . 
147 These exempti ons relate to income tax; the tax on the transfer of goods and provision of services; 
duties and taxes on the import of machinery and equipment needed to build, administer, operate and maintain 
the Airport; and the conveyance tax. (Chapter IV, Tax Exemptio ns, Law for the Construction, Administration, 
Operation and Maintenance of the Pacific International Airport).  
148 Decree No.  582 of 18 October 2001 (last amended on 20 December 2005)  
149 Article 22 of the Civil Aviation Organic Law.  
150 Article 21 of the Civil Aviation Organic Law.  
151 List of charges for AIES-SOARG . Viewed at: https://www.cepa.gob.sv/servicios/pliego -tarifa rio-del-
aeropuerto -internacional -de-el-salvador -san-oscar -arnulfo -romero -y-galdamez/ . WT/TPR/S/440  • El Salvador  
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  4.176.   In El Salvador 's Schedule of Specific Commitments annexed to the GATS, the country bound 
aircraft repair and maintenance services with respect to market access and national treatment for 
the cross -border supply, consumption abroad and commercial presence modes. In the case of 
commercial presence, the applicant must obtain a concession or licence from CEPA and be domiciled 
in the country.152 An operating certificate from the AAC is also required in ac cordance with the Civil 
Aviation  Organic Law.153 
4.177.   El Salvador's main national airline is Avianca El Salvador, formerly TACA, which merged with 
the Colombian airline, Avianca S.A., in 2013. In 2021, Avianca El Salvador transported 
654,927  passengers, or 30.6% of the passengers transiting through AIES -SOARG.154 The company 
Vuelos Economicos de Centro America  (VECA Airlines), which obtained its operating certificate in 
2014 and began operating in November 2014, ceased operations in 2017. In 20 21, 
Volaris  El Salvador, a subsidiary of Mexican airline Volaris, started operating in El Salvador after 
obtaining a foreign air operator permit from the United States, and now operates direct flights to 
the United States. The United States company Frontie r also started operating international flights 
from El  Salvador in 2021. In 2022, 17 international airlines were operating in the country with 
passenger flights from and to El Salvador.  
4.178.   CEPA promotes an open skies policy in order to attract airlines to hel p position El Salvador 
as a major tourist and business destination in the region.155 During the period under review, 
El Salvador signed four new bilateral air services agreements with Brazil, Canada, Panama and 
Qatar, it also reviewed the 2006 agreement wit h Mexico.156 However, a bilateral agreement does 
not need to have been signed to provide air transport services in El  Salvador.  
4.179.   Licences for landing slots are granted according to the principle of reciprocity under the 
Chicago Convention on International Civil Aviation.  
4.4.4.4   Land transport  
4.180.   Land transport is the main means of transporting freight in El Salvador. In 2021, the value 
of foreign trade (imports and exports) goods transported by land totalled USD  14,053.84 million. 
El Salvador's road net work is approximately 12,493 kilometres long, some 60% of which is paved.157 
4.181.   The Office of the Deputy Minister for Transport (VMT) remains responsible for regulating and 
supervising the subsector, which is governed by the Law on Road Freight Transport.158 During the 
period under review, the Directorate General of Freight Transport updated and simplified procedures 
to facilitate transport flows.  
4.182.   El Salvador is part of the Mesoamerica Project together with the countries of the region.159 
The project established the International Mesoamerican Roads Network, which mainly comprises the 
Pacific Corridor and the Atlantic Corridor, and provides the basis for further developing the sector 
and reducing high transport costs. Of the region's land freight, 95% is moved thro ugh the Pacific 
 
152 WTO document GATS/SC/29 of 15 April 1994.  
153 Article 3 of the Civil Aviation  Organic Law . 
154 CEPA, Anuario Estadístico – Año 2021 . Viewed at: 
https://www.transparencia.gob.sv/institutions/cepa/documents/479304/download . 
155 Article 80 of the Civil Aviation Organic Law, as amended by Decree No. 509 of 10  October 2013: 
"The State shall implement the open skies policy, in accordance with the provisions of Article 3 of the Law, to 
which end, the first, second, third, fourth and fifth freedoms of the air, and combinations thereof, shall be 
granted on the basis of the principle of real and effective reciprocity, and of the provisions of the international 
conventions and treaties concluded by El  Salvador with other States."  
156 These new agreements are in addition to those already in force with Chile (2013), Colombia ( 2011), 
Cuba (2013), Ecuador (2013), Guatemala (2007), Honduras (2007), Nicaragua (2007), Spain (1997), 
Türkiye  (2013), United Arab Emirates (2015), United Kingdom (2000) and United States (1997). 
WTO document WT/TPR/S/344/Rev.1 of 23 November 2016. During the period under review, the open skies 
agreement with Chinese Taipei ceased to apply.  
157 IDB, El Salvador's Infrastructure Master Plan 2019 -30. Viewed at: 
https://publications.iadb.org/publications/spanish/document/Plan_m aestro_de_infraestructura_de_El_Salvador
_Un_instrumento_de_planeaci%C3%B3n_de_infraestructura_multisectorial_a_largo_plazo_que_permitir%C3%
A1_potenciar_el_desarrollo_econ%C3%B3mico_y_social_de_El_Salvador.pdf . 
158 Decree No. 367 of 3 May 2013.  
159 Guatemala, Honduras, Nicaragua, Costa Rica, Panama, Belize, Colombia, the Dominican Republic and 
Mexico.  WT/TPR/S/440  • El Salvador  
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  Corridor, the shortest route between Panama and Puebla (Mexico). For El Salvador, the Pacific 
Corridor and the Pan American Highway are the country's main land transport infrastructure and are 
of crucial importance to its trade with Guatema la and Honduras.  
4.183.   On 26 April 2022, the Special Regime Law for the Simplification of Formalities and 
Administrative Acts relating to the Pacific Train160 was adopted to advance the Pacific Train project, 
which aims to improve land connectivity, promote produ ctive activities and create jobs. Pursuant to 
the Law, the planning, design and construction of the Pacific Train is the responsibility of the Ministry 
of Public Works and Transport. As in the case of the Pacific Airport, companies involved in the 
construc tion of the Pacific Train will enjoy tax exemptions.  
4.184.   Major road infrastructure works were completed during the period under review. Most 
notably, two sections of the coastal highway, as part of the FOMILENIO II programme161, at a cost 
of over USD 77 million ; the comprehensive upgrading of the border crossings at El Amatillo and 
Anguiatú, which will facilitate entry and exit procedures at these points; and the USD 30 million rural 
road improvement programme.162 
4.4.5   Tourism  
4.185.   Tourism is an increasingly important sect or for El Salvador's economy. The sector's share of 
GDP rose from 4.9% in 2016 to 6.5% in 2019, before falling sharply in 2020 as a result of the health 
crisis (3.1%) and rebounding in 2021 (5.1%).163 
4.186.   Tourism receipts increased from USD 1,183 million in 201 6 to USD 1,463 million in 2021, 
equivalent to 17.2% of the total value of El Salvador's exports of goods and services and almost half 
of services exports.164 At the end of 2021, 55,905 jobs were recorded in the sector.165 
4.187.   In 2019, the number of international visitors to El Salvador reached a peak of 2.6 million, 
an increase of 34% compared to 2015. However, in 2020, the sector contracted by 73% as a result 
of the COVID -19 pandemic, receiving 1.9 million fewer visitors than in the previous year, and lost 
USD 990 million in revenue. Formal job losses are also estimated to have reached 9% of the total.166 
In 2021, the sector rebounded with the arrival of 1.4 million  international visitors, recovering 54% 
of its pre -pandemic levels. In the same year, the hotel occupancy rate was 36.4%, the average stay 
was 11.2 nights, and average daily expenditure was USD 117.5.  
4.188.   The main entry routes into the country are land and air . In 2021, El Salvador's main tourism 
market was North America (63%), followed by Central America (33%), Europe (2%) and other 
regions (2%). During the period under review, the number of Salvadorans leaving the country 
increased, reaching 1.9 million peopl e in 2019.167 
4.189.   In order to revive the sector after the COVID -19 pandemic, the Government of El  Salvador 
developed a road map entitled " Reinicio de Turismo " (Kick -starting Tourism), which sought primarily 
to gradually reopen the sector after the pandemic and facilitated MSMEs' access to the help offered 
by national development banks.168 In addition, the Government extended the deadline for the 2019 
 
160 Decree No. 360 of 26 April 2022.  
161 The FOMILENIO II programme, financed by resources from the United States ' Millennium Challenge 
Corporation and the  Government of El Salvador, was terminated in 2020.  
162 MOPT, Memoria de Labores  2020-21. Viewed at: https://www.mop.gob.sv/logros -y-memoria/# . 
163 Plan Nacional de Turismo – El Salvador 2030 . Viewed at: https://mitur.gob.sv/wp -
content/uploads/2021/06/Plan -Nacional -de-Turismo -2030-El-Salvador -_-Ministerio-de-Turismo -
Bajaultimo1.pdf .  
164 WTO Secretariat calculations using  information provided by MITUR.  
165 Information provided by the authorities.  
166 Ministry of Tourism estimate based on data from the Salvadoran Social Security Institute.  
167 Plan Nacional de  Turismo – El Salvador 2030 .. Viewed at: https://mitur.gob.sv/wp -
content/uploads/2021/06/Plan -Nacional -de-Turismo-2030-El-Salvador -_-Ministerio -de-Turismo -
Bajaultimo1.pdf .  
168 Ministry of Tourism, Reinicio de turismo . Viewed at: https://www.mitur.gob.sv/download/reinicio -del-
turismo/ .  WT/TPR/S/440  • El Salvador  
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  income tax payments to 31 March 2020 for MSMEs in the sector whose tax bill was equal to or less 
than USD 25,000.169 
4.190.   Tourism is one of the strategic pillars of El Salvador's economic and social development 
processes. This sector is central to the Government's Cuscatlán Plan, which considers tourism to be 
the main driver of the economy. The Plan highlights the importance of tourism for creating jobs; 
increasing tax revenue; attracting foreign direct investment; boosting the economy, particularly 
small and medium -sized enterprises; and improving the trade balance.170 
4.191.   The institutional framework for the sector remains unchanged from the previous review 
period and is still comprised of the Ministry of Tourism (MITUR), which is the state authority 
responsible for formulating and implementing sectoral policy; the Salvadoran Tourism Corporation 
(CORSATUR), an autono mous institution charged with promoting the country's tourist attractions 
abroad, keeping the National Tourism Register and conducting a statistical census on the sector's 
infrastructure171; and the Salvadoran Tourism Institute (ISTU), which is responsible for the country's 
network of recreational and amusement parks.172 
4.192.   Under the WTO General Agreement on Trade in Services (GATS), El Salvador scheduled 
specific commitments on hotels and restaurants, travel agencies and tour operators services, and 
tourist gui des services.173 In the hotels and restaurants subsector, there are no limitations on market 
access or national treatment for modes 2 (consumption abroad) and 3 (commercial presence). In 
the subsector comprising travel agencies and tour operators services, there are no limitations on 
market access or national treatment for mode 3 (commercial presence). For tourist guides services, 
there are also no limitations under mode 3. For tourism services as a whole, mode 4 (presence of 
natural persons) is unbound, exp ect as indicated in the horizontal section, both for national 
treatment and market access.174 
4.193.   The sector is mainly governed by the Law on Tourism175 and its implementing 
regulations  (2012)176, together with regulations issued by MITUR. The Law on Tourism stip ulates the 
responsibilities of MITUR, establishes the National Tourism Register and the obligations of persons 
registered therein and institutes a special contribution to promote the sector. National tourism policy 
is based primarily on the El Salvador Nat ional Tourism Plan 2030, which seeks to establish a 
framework to consolidate and position El Salvador as a competitive tourist destination, taking into 
account sustainability and social development considerations. The Plan is structured around the 
followin g four pillars: (1) preserving national socio -cultural and natural heritage; (2) managing the 
country's capacities and potential; (3) managing tourism demand; and (4) the sector's institutional 
framework.177 The sector also has the Strategic Plan for Touris m 2020 -24, based on the National 
Tourism Plan 2020 -30. 
4.194.   One of the main interests of the Government of El Salvador is to take advantage of the 
coastal area conditions of the country 's. During the period under review, the Tourism Development 
Programme of the  Marine Coastal Strip was launched, which obtained a USD 25 million loan from 
the Inter -American Development Bank (IDB). The purpose of this project is to increase revenue from 
and employment in the marine coastal strip through the productive development o f the tourism 
 
169 Specia l Temporary Law on the Mode of Payment of Income Tax Applicable to Small Taxpayers, 
Tourism, Electricity, Television, Internet and Telephone Services, and on the Special Contribution for the 
Promotion of Tourism , Decree No. 598 of 20 March 2020.  
170 Cuscatl án Plan. Viewed at: https://plancuscatlan.com .  
171 Law on the Salvadoran Tourism Corporation (Legislative Decree No.  779) of 25 July 1996 
(last amended by Legislative Decree No.  900 of 10 December 2005).  
172 Law on the  Salvadoran Tourism Institute of 2 October 2008.  
173 WTO document GATS/SC/29 of 15 April 1994.  
174 In El Salvador's horizontal commitments, under mode 4 it is stated that every employer must employ 
Salvadoran nationals in a proportion of at least 90% of the pe rsonnel of the enterprise. In special 
circumstances the employment of more foreigners may be authorized, but employers remain obliged to train 
Salvadoran personnel. The amount of wages to Salvadorans may not be less than 85% of the total wages paid. 
This r equirement applies equally to domestic and foreign enterprises.  
175 Legislative Decree No.  899 of 17 December 2005 (last amended by Legislative Decree No.  88 of 
13 August 2015).  
176 General Regulations implementing the Law on Tourism, Executive Decree No. 108 of 14  June 2012.  
177 Plan Nacional de Turismo – El Salvador 2030 . Viewed at: https://mitur.gob.sv/wp -
content/uploads/2021/06/Plan -Nacional -de-Turismo -2030-El-Salvador -_-Ministerio -de-Turismo -
Bajaultimo1.pdf .  WT/TPR/S/440  • El Salvador  
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  sector. The project finances works and acquires goods and services under four components: 
(i) support for tourism products; (ii) strengthening social inclusion and local entrepreneurship; 
(iii) tourism governance; and (iv) environmental manag ement.178 A number of projects were 
completed under this programme, for example the updating of the National Tourism Policy, the 
drafting of the National Tourism Policy with Emphasis on Surfing, a project for the training of MSMEs 
and other tourism stakehol ders, and the strengthening of the tourism police.179 
4.195.   In recent years, sports tourism has grown considerably, particularly with regard to surfing. 
Between 2018 and 2019, surf -related activities were estimated to have increased by 9.3%.180 To 
meet this growin g demand, the National Tourism Policy with Emphasis on Surfing, and its 
implementation programme, Surf City, was developed during the review period. This comprehensive 
programme has a number of components and objectives in terms of infrastructure, environm ental 
sustainability and security, as well as social objectives.  
4.196.   During the period under review, major transport infrastructure projects were launched and 
are expected to have a positive impact on the Salvadoran tourism sector. These include the 
Pacific  International Airport construction project, the feasibility study for which was completed 
in 2022. The aim of this project is to turn the eastern area into a hub for economic development, to 
create greater demand among passengers abroad, and develop international tourism. In April 2022, 
the Law for the Construction, Administration, Operation and Maintenance of the Pacific International 
Airport was approved, which declares the construction of the Pacific International Airport to be 
"necessary, in the p ublic interest and the highest priority". The Law provides for tax exemptions for 
companies involved in the construction and operation of the airport. The project to expand the 
passenger terminal at the international airport of San Salvador was also comple ted, with a total cost 
of USD  45.3 million (Section 4.4.4.3). During the period under review, the bicentennial ferry route 
project, the aim of which is to connect El Salvador to other Central American ports, was also 
launched. The first phase of this proje ct will provide an alternative maritime route to land freight 
transport and, at a later stage, a maritime route for passenger transport (Section 4.4.4.2).181 
4.197.   In September 2022, the IDB approved a USD 106 million loan for the Programme to Support 
the Recover y and Expansion of the Tourism Sector in El Salvador. The objective of the programme 
is to improve El Salvador's international and national competitiveness in the area of tourism. 
Specifically, it is expected to increase international and domestic tourism spending per visitor; boost 
tourism employment, particularly formal employment, and narrow gender gaps; increase private 
investment in the sector; strengthen the sector's institutional capacity; and reinforce the 
environmental sustainability of Salvadoran tourist destinations.182 In November 2022, the Legislative 
Assembly authorized the signing of the loan contract.  
4.198.   Another measure taken by the Government to boost tourism flows in the country is the 
opening of airspace through the adoption of an open skies p olicy. The objectives of this policy are 
to improve passenger flows and increase corporate earnings in the tourism sector. In this regard, 
the policy revolves around two major strategic axes: (i) to encourage the intensive use of airspace, 
by taking advant age of existing air services agreements and promoting the signature of new 
agreements; and (ii) to create incentives, through tax exemptions and tax facilities, to attract new 
companies to operate from El Salvador.183 
4.199.   The Law on Tourism provides for taxes t o be levied to promote tourism activity. In 
accordance with Article  16 of the Law, a hotel stay tax is set, equivalent to 5% of the price for each 
 
178 IDB, Project Profile - Programme for Touristic Development of the Coastal -Marine Strip. Viewed at: 
https://idbdocs.iadb.org/wsdocs/getdocument.aspx?docnum=EZSHARE -1379657643 -2.  
179 Ministry of Tourism, Programa de Desarrollo Turístico de la Franja Costero -Marina . Viewed at: 
http://www.mitur.gob.sv/franja -costero -marina/ .  
180 Política de Turismo con Énfasis en el Surf . Viewed at: https://www.mitur.gob.sv/wp -
content/uploads/2021/07/Politica -de-Turismo -con-e%CC%81nfasis -en-el-Surf.pdf .  
181 Ministry of Public Works and Transport, Memoria de Labores  2020-21. Viewed at: 
https://www.mop .gob.sv/logros -y-memoria/ .  
182 IDB, Programa de Apoyo a la Recuperación y Expansión del Sector Turismo en El Salvador . Viewed 
at: https://idbdocs.iadb.org/wsdocs/g etdocument.aspx?docnum=EZSHARE -1501734583 -87.  
183 Ministry of Tourism, Política Nacional de Turismo – Turismo y cielos abiertos . Viewed at: 
https://www.transparencia.gob.sv/institutions/mitur/documents/280275/download .  WT/TPR/S/440  • El Salvador  
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  night's accommodation184, as well as a departure tax of USD  7 on departing international flights. 
Pursuant to the aforementioned Decree No.  598, and in the wake of the COVID -19 pandemic, an 
exemption from the payment of these taxes was granted for three months.185 
4.200.   In December 2020, the tax incentive regime to promote tourism development under the Law 
on Tourism expired. For any investment project exceeding USD  25,000 and considered to be of 
national tourism interest186, the Law offered a number of tax benefits, such as exemption from 
import tariffs on equipment and other goods needed to implement tourism p rojects.187 
4.201.   During the period under review, the tourism sector was considered to be one of the strategic 
sectors for the financing of the development bank. BANDESAL, the Mortgage Bank and the BFA have 
specific lines of credit targeting companies in the sect or. In 2020 for example, BANDESAL granted 
131 credits to the sector, worth a total of USD  6.3 million.188 
 
184 The rate is calculated on the basis of the net value of the service  provided , excluding value added 
tax. 
185 Special Temporary Law on the Mode of Payment of Income Tax Applicab le to Small Taxpayers, 
Tourism, Electricity, Television, Internet and Telephone Services, and on the Special Contribution for the 
Promotion of Tourism , Decree No. 598 of 20 March 2020.  
186 The conditions for a tourism project to be deemed to be of national interest are set out in 
Articles  55-60 of the General Regulations Implementing the Law on Tourism.  
187 For more information on tax incentives granted up to December 2020 in the framework of  the Law 
on Tourism, see WTO document WT/TPR/S/344/Rev.1, of 23 November 2016.  
188 Development Bank of El Salvador, Memoria de Labores 2020. Viewed at: 
https://w ww.transparencia.gob.sv/institutions/bandesal/documents/461557/download .  WT/TPR/S/440  • El Salvador  
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  5  APPENDIX TABLES  
Table A1. 1 Non-maquila merchandise exports by HS section and main HS chapter, 
2016 -21 
(USD million and %)  
Description  2016  2017  2018  2019  2020  2021    
(USD million)  
Non-maquila exports  4,316 4,661 4,727 4,739 4,139 5,377 
Maquila exports  1,104  1,099  1,178  1,166  889 1,252  
Total exports  5,420  5,760  5,905  5,905  5,028  6,629    
(% of non-maquila exports)  
1 -  Live animals; animal products  1.3 1.4 1.3 1.3 1.8 1.6  
04.  Dairy produce; birds' eggs; natural honey; edible 
products of animal origin  0.6 0.7 0.8 0.8 1.1 1.1 
 
03.  Fish and crustaceans , molluscs and other aquatic 
invertebrates  0.4 0.4 0.2 0.2 0.3 0.3 
 
01.  Live animals  0.2 0.2 0.2 0.2 0.3 0.3 
2 -  Vegetable products  4.9 4.6 4.4 4.7 5.3 4.4  
09.  Coffee , tea, maté and spices  2.6 2.6 2.4 2.3 2.7 2.3  
11.  Products of the milling industry; malt; starches; 
inulin; wheat gluten  1.1 1.1 1.1 1.2 1.3 1.0 
 
06.  Live trees and other plants; bulbs , roots and the 
like; cut flowers and ornamental foliage  0.5 0.5 0.5 0.6 0.6 0.5 
3 -  Animal or vegetable fats and oils  0.5 0.4 0.4 0.5 0.6 0.5 
4 -  Prepared foodstuffs; beverages, spirits and vinegar; 
tobacco and manufactured tobacco substitutes  16.7 17.2 16.4 17.7 19.1 17.1 
 
17.  Sugars and sugar confectionery  4.9 6.1 5.0 5.4 6.9 5.9  
19.  Preparations of cereals , flour, starch or milk  3.2 2.9 3.1 3.6 3.5 3.2  
22.  Beverages , spirits and vinegar  2.8 2.9 3.0 3.3 2.2 2.5  
21.  Miscellaneous edible preparations  1.3 1.4 1.4 1.7 2.3 1.9  
16.  Preparations of meat , of fish or of crustaceans , 
molluscs or other aquatic invertebrates  2.1 2.1 2.0 1.8 2.0 1.6 
 
20.  Preparations of vegetables , fruit, nuts or other 
parts of plants  1.8 1.2 1.3 1.3 1.2 1.1 
5 -  Mineral products  3.9 4.2 4.6 4.3 4.0 4.9  
27.  Mineral fuels; bituminous substances; mineral 
waxes  3.6 3.9 4.4 4.2 3.8 4.7 
 
25.  Salt; sulphur; earths and stone; plastering 
materials , lime and cement  0.3 0.3 0.1 0.1 0.1 0.1 
6 -  Products of the chemical or allied industries  7.0 6.3 6.2 7.0 8.3 7.6  
30. Pharmaceutical products  3.2 3.0 3.0 3.6 4.3 3.9  
32.  Tanning or dyeing extracts; dyes , pigments;  
paints and varnishes  1.2 1.1 1.1 1.3 1.3 1.4 
 
34.  Soap , organic surface -active agents , washing 
preparations , lubricating preparations  1.4 1.0 1.1 1.0 1.2 1.0 
7 -  Plastics and articles thereof  7.7 7.9 7.6 8.1 8.9 9.2 
8 -  Raw hides and skins, leather, furskins and articles  
thereof; saddlery and harness  0.2 0.2 0.2 0.2 0.2 0.2 
9 -  Wood and articles of wood; wood charcoal  0.2 0.2 0.2 0.1 0.1 0.1 
10 -  Pulp of wood or of other fibrous cellulosic material;  
paper and paperboard and articles thereof  6.7 6.6 6.8 7.5 7.9 7.8 
 
48.  Paper and paperboard; articles of paper pulp , of 
paper or of paperboard  6.1 5.9 6.2 6.9 7.3 7.2 
 
49.  Printed books , newspapers , pictures; manuscripts  0.5 0.4 0.4 0.4 0.4 0.5 
11 -  Textiles and textile articles  38.1 38.9 39.7 36.8 31.4 33.2  
61.  Articles of apparel and clothing accessories , 
knitted or crocheted  24.7 25.4 25.8 23.0 18.8 21.1 
 
62.  Articles of apparel and clothing accessories , not 
knitted or crocheted  4.6 4.6 4.4 3.9 3.1 2.8 
 
60.  Knitted or crocheted fabrics  3.2 3.4 3.3 4.0 2.8 2.7  
52.  Cotton  1.2 1.3 1.9 1.7 1.3 2.2  
63.  Other made up textile articles; sets; worn clothing 
and worn textile articles; rags  1.4 1.2 1.2 1.4 2.9 1.7 
 
54.  Man -made filaments  1.0 1.1 1.1 1.1 0.9 1.1 WT/TPR/S/440  • El Salvador  
- 135 - 
  Description  2016  2017  2018  2019  2020  2021  
12 -  Footwear, headgear, umbrellas, sun umbrellas, 
walking -sticks, seat -sticks, whips, riding -crops and parts 
thereof; prepared feathers and articles made therewith  1.0 0.9 0.7 0.7 0.6 0.6 
 
64.  Footwear , gaiters and the like; parts of such 
articles  1.0 0.8 0.7 0.6 0.6 0.5 
13 -  Articles of stone, plaster, cement, asbestos, mica  
or similar materials; ceramic products; glass and glassware  1.0 1.0 0.9 1.0 1.0 1.0 
14 -  Natural or cultured pearls, precious or semi -precious  
stones, precious metals  0.3 0.2 0.3 0.4 0.7 0.5 
15 -  Base metals and articles of base metal  5.8 5.9 6.6 6.0 5.8 6.7  
72.  Iron and steel  2.8 2.9 3.2 2.8 2.7 3.4  
73.  Articles of iron or steel  1.1 1.2 1.4 1.3 1.4 1.5  
76.  Aluminium and articles thereof  1.4 1.4 1.5 1.3 1.1 1.3 
16 -  Machinery and mechanical appliances;  
electrical equipment; parts thereof  1.9 1.7 1.6 1.4 1.8 2.0 
 
85.  Electrical machinery and equipment; sound and 
image recorders and reproducers  0.9 0.6 0.7 0.7 0.9 1.1 
17 -  Vehicles, aircraft, vessels and associated transport 
equipment  0.3 0.3 0.3 0.3 0.6 0.4 
 
87.  Vehicles other than railway or tramway rolling -
stock 0.3 0.2 0.3 0.3 0.4 0.4 
18 -  Optical, photographic, cinematographic, measuring, 
checking or precision instruments and apparatus  0.1 0.1 0.1 0.1 0.1 0.1 
19 -  Arms and ammunition; parts and accessories thereof  0.0 0.0 0.0 0.0 0.0 0.0 
20 -  Miscellaneous manufactured articles  2.3 2.0 1.8 1.9 1.7 1.9  
94.  Furniture; bedding , mattresses , mattress 
supports , cushions and similar stuffed furnishings  1.5 1.3 1.0 1.2 1.0 1.1 
21 -  Works of art, collectors' pieces and antiques  0.0 0.0 0.0 0.0 0.0 0.0 
Other  0.0 0.0 0.0 0.0 0.0 0.0 
Source:  WTO Secretariat calculations based on data from the Central Reserve Bank of El Salvador.  
  WT/TPR/S/440  • El Salvador  
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  Table A1. 2 Maquila  exports by HS section and main HS chapter, 2016 -21 
(USD million and %)  
Description  2016  2017  2018  2019  2020  2021    
(USD million)  
Maquila exports  1,104  1,099  1,178  1,166  889 1,252    
(% of maquila exports)  
5 -  Mineral products  0.0 0.0 0.0 0.0 0.0 0.0 
6 -  Products of the chemical or allied industries  0.3 0.4 0.6 0.9 3.1 3.0  
38.  Miscellaneous chemical products  0.0 0.0 0.5 0.8 3.0 2.9 
7 -  Plastics and articles thereof  0.3 0.3 0.7 1.6 2.3 2.1  
39.  Plastics and articles thereof  0.3 0.3 0.7 1.6 2.3 2.1 
8 -  Raw hides and skins, leather, furskins and articles  
thereof; saddlery and harness  0.0 0.0 0.0 0.0 0.0 0.0 
9 -  Wood and articles of wood; wood charcoal  0.0 0.0 0.0 0.0 0.0 0.0 
10 -  Pulp of wood or of other fibrous cellulosic material;  
paper and paperboard and articles thereof  0.0 0.1 0.0 0.1 0.1 0.1 
 
48.  Paper and paperboard; articles of paper pulp , of 
paper or of paperboard  0.0 0.1 0.0 0.0 0.0 0.1 
11 -  Textiles and textile articles  79.3 73.1 69.7 74.5 70.5 69.9  
61.  Articles of apparel and clothing accessories , knitted 
or crocheted  71.4 65.6 63.2 68.8 65.9 66.3 
 
62.  Articles of apparel and clothing accessories , not 
knitted or crocheted  7.3 6.5 5.8 4.9 3.4 2.7 
 
58.  Special woven fabrics; tufted textile fabrics; lace; 
tapestries  0.4 0.4 0.3 0.4 0.3 0.3 
12 -  Footwear, headgear, umbrellas, sun umbrellas, walking -
sticks, seat-sticks, whips, riding -crops and parts thereof; 
prepared feathers and articles made therewith  0.4 0.0 0.0 0.0 0.0 0.0 
13 -  Articles of stone, plaster, cement, asbestos, mica  
or similar materials; ceramic products; glass and glassware  0.0 0.0 0.0 0.0 0.0 0.0 
14 -  Natural or cultured pearls, precious or semi -precious  
stones, precious metals  0.1 0.1 0.0 0.0 0.0 0.0 
15 -  Base metals and articles of base metal  0.4 0.4 0.5 0.2 0.2 0.2  
83.  Miscellaneous articles of base metal  0.2 0.2 0.2 0.2 0.1 0.2  
81.  Other base metals; cermets; articles thereof  0.1 0.1 0.1 0.0 0.0 0.0  
72.  Iron and steel  0.1 0.2 0.1 0.0 0.0 0.0 
16 -  Machinery and mechanical appliances;  
electrical equipment; parts thereof  19.1 25.5 28.4 22.7 23.8 24.6 
 
85.  Electrical machinery and equipment; sound and 
image recorders and reproducers  19.1 25.5 28.4 22.7 23.8 24.6 
18 -  Optical, photographic, cinematographic, measuring, 
checking or precision instruments and apparatus  0.0 0.0 0.0 0.0 0.0 0.0 
20 -  Miscellaneous manufactured articles  0.0 0.0 0.0 0.0 0.0 0.0 
Source:  WTO Secretariat calculations based on data from the Central Reserve Bank of El Salvador.  
  WT/TPR/S/440  • El Salvador  
- 137 - 
  Table A1. 3 Non-maquila merchandise imports by HS section and main H S chapter, 
2016 -21  
(USD million and %)    
2016  2017  2018  2019  2020  2021    
(USD million)  
Non-maquila imports  9,391  9,964  10,82
6 10,95
5 9,768  14,37
0 
Maquila imports  434 607 638 647 480 706 
Total imports  9,826  10,57
2 11,46
4 11,60
2 10,24
8 15,07
6   
(% of non-maquila imports)  
1 -  Live animals; animal products  3.6 3.7 3.5 4.4 5.1 4.2  
04.  Dairy produce; birds' eggs; natural honey; 
edible products of animal origin  1.9 1.8 1.7 2.1 2.7 2.1 
 
02.  Meat and edible meat offal  1.3 1.4 1.5 2.0 2.1 1.8  
03.  Fish and crustaceans , molluscs and other 
aquatic invertebrates  0.3 0.4 0.3 0.3 0.2 0.2 
2 -  Vegetable products  5.0 4.3 4.8 5.3 6.2 4.6  
10.  Cereals  2.7 2.0 2.4 2.6 2.7 2.3  
07.  Edible vegetables and certain roots and 
tubers  0.8 0.8 0.9 1.0 1.5 0.9 
 
08.  Edible fruit and nuts; peel of citrus fruit or 
melons  0.8 0.8 0.9 1.0 1.1 0.8 
3 -  Animal or vegetable fats and oils  1.6 1.7 1.5 1.4 1.9 1.8 
4 -  Prepared foodstuffs; beverages, spirits and 
vinegar; tobacco and manufactured tobacco 
substitutes  9.2 8.5 8.4 8.7 10.6 8.2 
 
21.  Miscellaneous edible preparations  2.7 2.6 2.5 2.6 2.9 2.3  
23.  Residues and waste from the food industries; 
prepared animal fodder  1.6 1.4 1.5 1.5 1.7 1.5 
 
19.  Preparations of cereals , flour, starch or milk  1.5 1.3 1.3 1.4 2.2 1.3  
22.  Beverages , spirits and vinegar  1.2 1.1 1.1 1.1 1.3 1.1 
5 -  Mineral products  12.8 14.5 17.4 16.0 11.3 14.3  
27.  Mineral fuels; bituminous substances; 
mineral waxes  12.5 14.1 17.0 15.5 10.7 13.7 
 
25.  Salt; sulphur; earths and stone; plastering 
materials , lime and cement  0.3 0.3 0.4 0.5 0.6 0.5 
6 -  Products of the chemical or allied industries  12.3 11.7 10.8 11.7 12.9 11.6  
30.  Pharmaceutical products  3.8 3.5 3.2 3.8 4.4 4.3  
33.  Essential oils; perfumery , cosmetic or toilet 
preparations  2.0 1.8 1.8 2.0 1.8 1.6 
 
34.  Soap , organic surface -active agents , washing 
preparations , lubricating preparations  1.3 1.2 1.2 1.3 1.6 1.3 
 
38.  Miscellaneous chemical products  1.5 1.4 1.2 1.3 1.6 1.3  
32.  Tanning or dyeing extracts; dyes , pigments;  
paints and varnishes  1.3 1.2 1.0 1.0 1.0 1.0 
7 -  Plastics and articles thereof  7.2 7.1 6.7 6.7 6.7 7.3  
39.  Plastics and articles thereof  6.2 6.2 5.9 5.8 5.9 6.4  
40.  Rubber and articles thereof  0.9 0.9 0.8 0.8 0.8 0.9 
8 -  Raw hides and skins, leather, furskins and articles  
thereof; saddlery and harness  0.4 0.3 0.3 0.3 0.2 0.2 
9 -  Wood and articles of wood; wood charcoal  0.4 0.4 0.4 0.5 0.5 0.5 
10 -  Pulp of wood or of other fibrous cellulosic 
material;  
paper and paperboard and articles thereof  3.9 3.9 3.7 3.7 3.4 3.2 
 
48.  Paper and paperboard; articles of paper pulp , 
of paper or of paperboard  2.9 2.9 2.7 2.7 2.6 2.5 
11 -  Textiles and textile articles  11.3 11.8 10.2 9.4 8.0 8.2  
52.  Cotton  1.9 2.5 2.1 1.8 1.3 1.5  
60.  Knitted or crocheted fabrics  1.8 1.9 1.6 1.6 1.1 1.3  
54.  Man -made filaments  1.8 1.7 1.2 1.2 1.1 1.0  
55.  Man -made staple fibres  1.4 1.4 1.3 1.1 1.0 1.0  
61.  Articles of apparel and clothing accessories , 
knitted or crocheted  1.8 1.7 1.6 1.5 0.8 1.0 
12 -  Footwear, headgear, umbrellas, sun umbrellas, 
walking -sticks, seat -sticks, whips, riding -crops and 
parts thereof; prepared feathers and articles made 
therewith  1.1 1.0 1.0 0.9 0.7 0.8 
 
64.  Footwear , gaiters and the like; parts of such 
articles  1.0 0.9 0.9 0.8 0.6 0.7 
13 -  Articles of stone, plaster, cement, asbestos, mica  
or similar materials; ceramic products; glass and 
glassware  1.2 1.1 1.1 1.2 1.3 1.3 WT/TPR/S/440  • El Salvador  
- 138 - 
    
2016  2017  2018  2019  2020  2021   
69.  Ceramic products  0.5 0.5 0.5 0.6 0.5 0.6  
70.  Glass and glassware  0.4 0.4 0.4 0.4 0.4 0.4 
14 -  Natural or cultured pearls, precious or 
semi-precious  stones, precious metals  0.1 0.1 0.1 0.1 0.1 0.1 
15 -  Base metals and articles of base metal  5.8 6.6 7.0 6.6 6.4 8.3  
72.  Iron and steel  2.5 3.3 3.6 3.1 2.7 4.3  
73.  Articles of iron or steel  1.5 1.5 1.6 1.7 1.9 2.0 
16 -  Machinery and mechanical appliances;  
electrical equipment; parts thereof  14.8 14.2 14.3 14.3 16.4 15.9 
 
84.  Nuclear reactors, boilers, machinery and 
mechanical appliances  7.5 7.1 6.2 6.7 6.4 8.3 
 
85.  Electrical machinery and equipment; sound 
and image recorders and reproducers  7.3 7.1 8.1 7.6 9.9 7.5 
17 -  Vehicles, aircraft, vessels and associated 
transport equipment  5.4 5.3 5.3 5.3 4.5 6.2 
 
87.  Vehicles other than railway or tramway 
rolling -stock 5.3 5.2 5.0 5.2 4.5 5.6 
18 -  Optical, photographic, cinematographic, 
measuring, checking or precision instruments and 
apparatus  1.4 1.3 1.2 1.2 1.6 1.1 
 
90.  Optical , photographic , precision , medical or 
surgical instruments and apparatus  1.3 1.2 1.1 1.1 1.5 1.0 
 
92.  Musical instruments  0.0 0.0 0.0 0.0 0.0 0.0 
19 -  Arms and ammunition; parts and accessories 
thereof  0.0 0.1 0.0 0.0 0.0 0.0 
20 -  Miscellaneous manufactured articles  2.2 2.1 2.0 2.1 2.0 2.0  
94.  Furniture; bedding , mattresses , mattress 
supports , cushions and similar stuffed furnishings  0.9 0.8 0.8 0.9 0.8 0.9 
 
96.  Miscellaneous manufactured articles  0.8 0.8 0.8 0.8 0.8 0.7 
21 -  Works of art, collectors' pieces and antiques  0.0 0.0 0.0 0.0 0.0 0.0 
Other  0.2 0.2 0.2 0.2 0.2 0.2 
Source:  WTO Secretariat calculations based on data from the Central Reserve Bank of El Salvador.  
 
  WT/TPR/S/440  • El Salvador  
- 139 - 
  Table A1. 4 Maquila imports by HS section and main HS chapter, 2016 -21 
(USD million and %)    
2016  2017  2018  2019  2020  2021    
(USD million)  
Maquila imports  434 607 638 647 480 706   
(% of maquila imports)  
4 -  Prepared foodstuffs; beverages, spirits and 
vinegar; tobacco and manufactured tobacco 
substitutes  0.0 0.0 0.0 0.0 0.0 0.0 
5 -  Mineral products  0.0 0.0 0.0 0.0 0.0 0.0 
6 -  Products of the chemical or allied industries  3.6 2.6 2.4 2.4 5.5 4.9  
38.  Miscellaneous chemical products  1.0 0.7 1.1 1.5 4.7 3.6  
28.  Inorganic chemicals  0.9 0.6 0.6 0.3 0.4 0.6  
32.  Tanning or dyeing extracts; dyes , pigments;  
paints and varnishes  1.4 0.9 0.5 0.5 0.3 0.3 
7 -  Plastics and articles thereof  5.5 4.5 4.7 5.1 5.3 5.5  
39.  Plastics and articles thereof  4.8 3.9 4.0 4.5 4.7 5.1 
8 -  Raw hides and skins, leather, furskins and articles  
thereof; saddlery and harness  0.0 0.0 0.0 0.0 0.0 0.0 
9 -  Wood and articles of wood; wood charcoal  0.0 0.0 0.0 0.0 0.0 0.0 
10 -  Pulp of wood or of other fibrous cellulosic 
material;  paper and paperboard and articles thereof  2.3 1.7 1.3 1.2 1.0 1.2 
 
48.  Paper and paperboard; articles of paper pulp , 
of paper or of paperboard  1.8 1.4 1.1 1.1 0.9 1.0 
 
49.  Printed books, newspapers, pictures; 
manuscripts  0.5 0.3 0.3 0.2 0.1 0.2 
11 -  Textiles and textile articles  68.1 57.5 72.7 78.0 69.2 69.8  
61.  Articles of apparel and clothing accessories, 
knitted or crocheted  27.2 31.4 51.2 58.0 50.7 49.6 
 
60.  Knitted or crocheted fabrics  22.0 14.1 12.5 12.7 11.8 14.4  
55.  Man -made staple fibres  5.4 3.8 3.9 2.3 1.6 1.6  
58.  Special woven fabrics; tufted textile fabrics; 
lace; tapestries  1.4 1.0 1.2 1.2 1.1 1.2 
 
54.  Man -made filaments  5.1 2.9 1.0 1.1 0.8 1.1 
12 -  Footwear, headgear, umbrellas, sun umbrellas, 
walking -sticks, seat -sticks, whips, riding -crops and 
parts thereof; prepared feathers and articles made 
therewith  0.3 0.0 0.0 0.0 0.0 0.0 
 
64.  Footwear, gaiters and the like; parts of such 
articles  0.3 0.0 0.0 0.0 0.0 0.0 
13 -  Articles of stone, plaster, cement, asbestos, 
mica or similar materials; ceramic products; glass 
and glassware  0.3 0.3 0.3 0.2 0.2 0.2 
 
70.  Glass and glassware  0.1 0.2 0.2 0.1 0.1 0.2 
14 -  Natural or cultured pearls, precious or semi -
precious stones, precious metals  1.5 1.3 1.1 0.7 1.0 1.6 
15 -  Base metals and articles of base metal  15.1 14.6 11.8 7.0 11.6 12.5  
81.  Other base metals; cermets; articles thereof  11.4 11.5 8.7 4.7 9.6 9.9  
73.  Articles of iron or steel  2.4 2.1 2.1 1.6 1.4 1.7  
72.  Iron and steel  0.8 0.6 0.7 0.4 0.4 0.6 
16 -  Machinery and mechanical appliances; electrical 
equipment; parts thereof  2.5 16.8 5.2 4.9 5.9 4.1 
 
85.  Electrical machinery and equipment; sound 
and image recorders and reproducers  2.5 16.8 5.2 4.9 5.8 4.1 
17 -  Vehicles, aircraft, vessels and associated 
transport equipment  0.0 0.0 0.0 0.0 0.0 0.0 
18 -  Optical, photographic, cinematographic, 
measuring, checking or precision instruments and 
apparatus  0.0 0.0 0.0 0.0 0.0 0.0 
20 -  Miscellaneous manufactured articles  0.9 0.7 0.4 0.4 0.2 0.3  
96.  Miscellaneous manufactured articles  0.8 0.7 0.4 0.4 0.2 0.3 
Source:  WTO Secretariat calculations based on data from the Central Reserve Bank of El Salvador.  
  WT/TPR/S/440  • El Salvador  
- 140 - 
  Table A1. 5 Total merchandise exports by trading partner, 2016 -21ª 
(USD million and %)   
2016  2017  2018  2019  2020  2021   
(USD million ) 
Exports  5,420  5,760  5,905  5,905  5,028  6,629   
(% of exports)  
America  94.6 92.9 93.9 94.6 92.5 93.2 
  United States  47.2 44.9 44.4 42.4 39.7 39.9 
  Other America  47.1 48.0 49.5 52.2 52.8 53.3 
 Guatemala  13.7 13.8 14.4 15.9 16.9 17.3 
 Honduras  14.1 13.8 15.3 15.9 15.4 16.4 
 Nicaragua  7.2 7.5 6.9 6.7 7.2 7.4 
 Costa Rica  4.6 4.5 4.4 4.5 4.6 4.2 
 Mexico  1.3 2.0 2.4 2.5 2.5 2.1 
 Panama  2.3 2.1 2.1 2.0 1.9 1.9 
 Dominican Republic  1.5 1.4 1.7 1.7 1.8 1.7 
 Canada  0.4 0.7 0.4 1.1 0.4 0.4 
 Jamaica  0.4 0.3 0.3 0.3 0.3 0.3 
 Belize  0.2 0.3 0.4 0.3 0.2 0.3 
 Haiti 0.1 0.1 0.2 0.2 0.2 0.3 
Europe  3.1 3.1 2.9 2.9 3.4 3.2 
  EU (27)  2.5 2.8 2.5 2.7 3.2 2.8 
 Germany  0.4 0.4 0.3 0.4 0.7 0.7 
 Spain  0.7 0.8 0.8 0.8 0.7 0.6 
 Italy 0.5 0.6 0.5 0.5 0.7 0.6 
 Netherlands  0.4 0.3 0.3 0.4 0.6 0.5 
 Belgium  0.1 0.1 0.2 0.2 0.2 0.2 
  EFTA 0.0 0.1 0.0 0.1 0.0 0.1 
 Norway  0.0 0.0 0.0 0.1 0.0 0.1 
  Other Europe  0.5 0.2 0.4 0.2 0.2 0.3 
 United Kingdom  0.5 0.2 0.4 0.2 0.2 0.3 
Commonwealth of Independent States (CIS)b 0.0 0.0 0.0 0.0 0.0 0.0 
Africa  0.1 0.1 0.2 0.1 0.1 0.1 
 South Africa  0.0 0.1 0.1 0.0 0.0 0.0 
Middle East  0.1 0.1 0.0 0.0 0.1 0.1 
 Saudi Arabia, Kingdom of  0.0 0.0 0.0 0.0 0.1 0.1 
Asia 2.1 3.8 2.9 2.4 3.9 3.5 
  China  0.1 0.8 1.5 0.9 1.5 1.1 
  Japan  0.3 0.3 0.2 0.2 0.3 0.2 
  Other Asia  1.7 2.7 1.3 1.3 2.1 2.2 
 Korea, Republic of  0.2 0.2 0.2 0.5 1.2 1.2 
 Chinese Taipei  0.7 0.9 0.5 0.4 0.5 0.6 
 Australia  0.1 0.1 0.1 0.1 0.1 0.1 
 Malaysia  0.0 0.0 0.1 0.0 0.0 0.1 
 Thailand  0.0 0.0 0.0 0.0 0.0 0.1 
Memorandum:        
EU (28)  3.0 3.0 2.9 2.8 3.4 3.1 
a Includes maquila and non -maquila exports.  
b Commonwealth of Independent States, including certain associate and former member States.  
Source:  WTO Secretariat calculations based on data from the Central Reserve Bank of El Salvador.  
  WT/TPR/S/440  • El Salvador  
- 141 - 
  Table A1. 6 Total merchandise imports by trading partner, 2016 -21ª 
(USD million and %)   
2016  2017  2018  2019  2020  2021   
(USD million)  
Imports  9,826  10,572  11,464  11,602  10,248  15,076   
(% of imports)  
America  68.3 68.2 67.6 69.1 66.9 63.9 
  United States  32.3 31.8 31.5 29.8 25.8 27.2 
  Other America  35.9 36.4 36.2 39.4 41.1 36.7 
 Guatemala  10.1 9.9 10.1 10.9 11.8 10.6 
 Mexico  7.5 8.3 8.0 8.1 9.2 8.1 
 Honduras  5.1 5.5 6.4 7.0 6.5 5.8 
 Nicaragua  2.6 2.5 2.4 3.2 3.9 3.0 
 Costa Rica  2.5 2.4 2.3 2.6 3.0 2.5 
 Colombia  1.2 1.3 1.2 1.3 1.3 1.2 
 Brazil  1.8 1.6 1.3 1.4 1.4 1.2 
 Canada  0.8 0.8 0.7 0.6 0.6 0.9 
 Panama  0.4 0.7 0.5 0.6 0.6 0.8 
 Chile 0.7 0.9 0.8 0.8 0.8 0.7 
 Argentina  0.3 0.5 0.5 0.5 0.5 0.6 
 Ecuador  0.4 0.5 1.0 1.1 0.2 0.4 
 Uruguay  0.3 0.3 0.3 0.4 0.4 0.4 
 Peru 0.5 0.4 0.3 0.6 0.4 0.3 
Europe  7.1 7.4 8.1 7.2 9.8 7.1 
  EU (27)  6.1 6.4 7.1 6.3 8.8 6.0 
 Spain  1.0 1.2 2.2 1.5 1.8 1.7 
 Germany  1.8 1.7 1.6 1.5 1.6 1.3 
 Italy 0.9 0.9 0.8 1.0 1.0 0.7 
 France  0.6 0.6 0.5 0.6 0.7 0.5 
 Netherlands  0.2 0.2 0.2 0.3 0.3 0.3 
  EFTA 0.4 0.3 0.3 0.3 0.3 0.3 
 Switzerland  0.4 0.3 0.3 0.3 0.3 0.2 
  Other Europe  0.6 0.7 0.7 0.6 0.7 0.8 
 Türkiye  0.1 0.3 0.3 0.2 0.3 0.5 
 United Kingdom  0.5 0.4 0.4 0.4 0.3 0.3 
Commonwealth of Independent States (CIS)b 0.2 0.3 0.3 0.4 0.3 0.8 
 Russian Federation  0.1 0.3 0.3 0.4 0.3 0.8 
Africa  0.1 0.1 0.1 0.1 0.1 0.1 
Middle East  0.3 0.3 0.4 0.3 0.3 0.5 
 Saudi Arabia, Kingdom of  0.1 0.1 0.2 0.1 0.1 0.2 
 United Arab Emirates  0.1 0.1 0.1 0.1 0.1 0.1 
 Israel  0.1 0.1 0.1 0.1 0.1 0.1 
Asia 24.0 23.7 23.4 22.9 22.6 27.6 
  China  14.3 13.7 14.1 14.3 14.3 16.8 
  Japan  2.3 2.2 2.0 1.9 1.7 2.1 
  Other Asia  7.5 7.9 7.3 6.7 6.6 8.8 
 Korea, Republic of  1.8 2.2 2.0 2.0 1.7 2.4 
 India 1.1 1.0 1.0 1.0 1.0 1.5 
 Singapore  0.1 0.1 0.1 0.1 0.1 1.1 
 Viet Nam 0.6 0.7 0.5 0.7 1.0 1.0 
 Chinese Taipei  1.4 1.4 1.2 1.0 0.9 0.8 
 Thailand  1.0 1.1 0.8 0.7 0.8 0.7 
 Indonesia  0.3 0.4 0.3 0.3 0.3 0.4 
 Malaysia  0.3 0.2 0.6 0.2 0.2 0.3 
Other  0.0 0.0 0.1 0.0 0.0 0.0 
Memorandum:        
EU (28)  6.6 6.8 7.4 6.6 9.1 6.3 
a Includes maquila and non -maquila imports . 
b Commonwealth of Independent States, including certain associate and former member States.  
Source:  WTO Secretariat calculations based on data from the Central Reserve Bank of El Salvador.  
  WT/TPR/S/440  • El Salvador  
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  Table A2. 1 Notifications submitted to the WTO by El Salvador, 2016 -22 (30  September)  
Agreement and provision  Type of measure 
notified  Frequency  WTO document  Date  
Agreement on Trade Facilitation  
Articles 1.4(a), 1.4(b)  
(Category A )  
Once only /  Ad hoc   
Notified  
Article 1.4(c) (Category A )  Once only /  Ad hoc   Notified  
Article 10.4.3 (Category C )   Once only /  Ad hoc   Notified  
Article 10.6.2 (Category A )  Once only /  Ad hoc   Notified  
Article 12.2 (Category C )  Once only /  Ad hoc   Notified  
Agreement on Agriculture  
Article 18.2 (MA:2)  Imports subject to 
tariff quotas  On an annual 
basis G/AG/N/SLV/82  07/03/2022  
Article 18.2 (MA:1)  Administration of tariff 
quotas  On an annual 
basis G/AG/N/SLV/69  25/01/2021  
Articles 5.7 and 18.2 (MA:5)  Special safeguard 
provisions  On an annual 
basis G/AG/N/SLV/81  15/02/2022  
Article 18.2 (DS:1) Domestic support  On an annual 
basis G/AG/N/SLV/79  18/06/2021  
Articles 10 and 18.2 (ES:1) Export subsidies  On an annual 
basis G/AG/N/SLV/80  03/02/2022  
General Agreement on Trade in Services  
Article III:4 and Article IV:2  Contact and enquiry 
points  Once only /  Ad hoc  S/ENQ/78/Rev.18  01/02/2019  
Agreement on Import Licensing  
Article 5.1 - 5.4 Import licensing  Once only /  Ad hoc  G/LIC/N/2/SLV/1  27/04/2016  
Article 7.3  Import licensing 
procedures  Once only /  Ad hoc  G/LIC/N/3/SLV/4  27/08/2020  
GATT 1994  
Article XVII:4(a)  State trading 
enterprises (STR)  On an annual 
basis G/STR/N/19/SLV  15/02/2022  
Agreement on the Application of Sanitary and Phytosanitary Measures  
Annex B  (3) Notification of sanitary 
or phytosanitary  (SPS)  
measures applicable 
to various products  Ad hoc  23 notifications, the 
most recent being 
G/SPS/N/SLV/139  30/09/2022  
Annex B  (10)  Ad hoc    
Agreement on Rules of Origin  
Article 5 and Annex II, 
paragraph 4  Preferential rules of 
origin  Ad hoc  G/RO/N/225  29/04/2021  
Agreement on Subsidies and Countervailing Measures  
Article 25.1   
On an annual 
basis G/SCM/N/372/SLV  14/09/2021  
Article 25.11   
Semi-annual  G/SCM/N/251/SLV  03/07/2020  
Article 32.6   Once only / Ad hoc G/SG/N/1/SLV/3/Suppl.1  03/11/2016  
Agreement on Customs Valuation  
Laws and regulations   
Once only / Ad hoc G/VAL/N/1/SLV/1  07/07/2021  
Check -list of issues   Once only / Ad hoc G/VAL/N/2/SLV/1  21/09/2021  
Interest charges   Once only / Ad hoc G/VAL/N/3/SLV/1  04/11/2021  
Carrier media   Once only / Ad hoc G/VAL/N/3/SLV/2  12/01/2022  WT/TPR/S/440  • El Salvador  
- 143 - 
  Agreement and provision  Type of measure 
notified  Frequency  WTO document  Date  
Anti-Dumping Agreement  
Article 16.4  Agreement on 
Implementation of 
Article VI of the 
GATT  1994 Semi-annual  G/ADP/N/364/SLV  09/03/2022  
Article 18.5  Agreement on 
Implementation of 
Article VI of the 
GATT  1994 Once only / Ad hoc G/SG/N/1/SLV/3/Suppl.1  03/11/2016  
Agreement on Safeguards  
Article 12.6   Once only / Ad hoc  G/SG/N/1/SLV/3/Suppl.1  03/11/2016  
Quantitative restrictions   
G/L/59/Rev.1   Biennial  G/MA/QR/N/SLV/1  27/09/2021  
Source:  WTO Secretariat.  
  WT/TPR/S/440  • El Salvador  
- 144 - 
  Table A2. 2 Bilateral agreements on the promotion and reciprocal protection of 
investment  signed by El Salvador, in force as at November 2022  
Partner  Date of signature  Date of entry into force  Current status  
France  20 September 1978  12 December 1992  In force  
Switzerland  8 December 1994  16 September 1996  In force  
Spain  14 February 1995  20 February 1996  In force  
Argentina  9 May 1996  8 January 1999  In force  
Peru  13 June 1996  14 December 1996  In force  
Chile  8 November 1996  3 July 2002  In force  
Germany  11 December 1997  15 April 2001  In force  
Paraguay  30 January 1998  9 November 1998  In force  
Korea, Rep. of  7 July 1998  25 May 2002  In force  
Morocco  21 April 1999  11 April 2002  In force  
Belgium/Luxembourg  12 October 1999  18 November 2002  In force  
Netherlands  12 October 1999  1 March 2001  In force  
United Kingdom  14 October 1999  1 December 2000  In force  
Czech Republic  30 November 1999  28 March 2001  In force  
Israel  3 April 2000  7 July 2003  In force  
Uruguay   24 August 2000  23 May 2003  In force  
Finland  20 May 2002  20 February 2003  In force  
Source:  WTO Secretariat on the basis of information provided by the authorities.  
  WT/TPR/S/440  • El Salvador  
- 145 - 
  Table A3. 1 Application of agricultural tariff quotas under trade agreements, 
as at 1 January 2022  
Country  Product  Tariff heading  Out-of-quota 
tariff (%)a Quantity 
(MT) or 
quota (USD)  
United States  Chicken parts  0207.13.93.00,  0207.13.94.00,  27.4 5,574 MT   
0207.14.93.00,  0207.14.94.00,    
 
1602.32.10.00         
Liquid milk  0401.10.00.00,  0401.20.00.00,  12 22 MT   
0401.40.00.00,  0401.50.00.00       
Milk in powder  0402.10.00.00,  0402.21.11.00  6 655 MT   
0402.21.12.00,  0402.21.21.00,  4.5  
 
0402.21.22.00,  0402.29.00.00       
Buttermilk, curdled 
milk and cream, and 
yogurt  0403.20.10.00,  0403.20.20.00,  12 22 MT   
0403.20.90.00,  0403.90.10.00,    
 
0403.90.90.00         
Butter  0405.10.00.00,  0405.20.00.00  9 218 MT   
0405.90.90.00    6  
Cheese  0406.10.10.00,  0406.10.90.00,  12 895 MT   
0406.20.20.00,  0406.20.90.00,    
 
0406.30.00.00,  0406.90.20.00,    
 
0406.90.90.00         
White maize (corn)  1005.90.30.00    20 46,900 MT   
Rice in the husk  1006.10.90.00    6.7 84,740 MT   
Milled white rice  1006.20.00.00,  1006.30.10.00,  6.7 11,645 MT   
1006.30.20.00,  1006.30.90.00,    
 
1006.40.00.00         
Ice cream  2105.00.00.00    4.5 262 MT   
Other dairy products  2106.90.20.00   
4.5 262 MT  
Mexico  Yellow maize (corn)  1005.90.20.00   
15 120,000 MT  
Panama  Cheese  0406.10.10.00,  0406.10.90.00,  40 USD 250,000b  
0406.20.20.00,  0406.20.90.00,    
 
0406.30.00.00,  0406.90.20.00,    
 
0406.90.90.00     
United 
Kingdom  Cured ham and 
bellies (streaky)  0210.11.00.00,  0210.12.00.00  15 177 MT  
 
0210.19.00.00    13.3  
Milk in powder  0402.10.00.00,  0402.21.11.00,  20 30 MT   
0402.21.12.00,  0402.21.21.00,  15  
 
0402.21.22.00,  0402.29.00.00    
 
Cheese  0406.10.10.00,  0406.20.20.00,  40 87 MT   
0406.20.90.00,  0406.30.00.00,    
 
0406.90.20.00,  0406.90.90.00       
Prepared or 
preserved meat of 
swine  1602.41.00.00,  1602.42.00.00,  13.3 177 MT   
1602.49.90.00     
European Union  Cured ham and 
bellies (streaky)  0210.11.00.00,  0210.12.00.00  15 1,305 MT   
0210.19.00.00    13.3  
Milk in powder  0402.10.00.00,  0402.21.11.00,  20 290 MT   
0402.21.12.00,  0402.21.21.00,  15  
 
0402.21.22.00,  0402.29.00.00   
   
Cheese  0406.10.10.00,  0406.20.20.00,  40 844 MT   
0406.20.90.00,  0406.30.00.00,    
 
0406.90.20.00,  0406.90.90.00       
Prepared or 
preserved meat of 
swine  1602.41.00.00,  1602.42.00.00,  13.3 1,305 MT   
1602.49.90.00     
a The in -quota tariff for all headings is 0%.  
b With the exception of Münster cheese.  
Source:  WTO Secretariat calculations based on data provided by the authorities.  
  WT/TPR/S/440  • El Salvador  
- 146 - 
  Table A3. 2 Main BANDESAL first -tier credit programmes  
Approved name  Description  Term  Grace period  
Credit line for 
productive activities  Provides resources to Salvadoran 
entrepreneurs in various productive sectors, 
thus helping to stimulate the economy.  5-15 years  1-2 years  
Credit line for the 
construction sector  Provides financial resources for construction 
projects involving interaction with other related 
sectors; finances medium - and long-term 
investment projects that are viable and 
profitable, prioritizing projects that generate 
employment, improve health and education 
services, and have a positive social impact.  6-15 years  1-2 years  
Coffee credit line  Provides the coffee sector with financing to 
increase its productivity and helps to stimulate 
the sector.  Up to 8  years  According to 
project 
assessment  
Credit line for 
agricultural activities  Provides financing to the agricultural sector to 
increase productivity and job crea tion, and 
promotes a positive impact on environmental 
conservation.  5-15 years  1-2 years  
Credit line for sugar 
cane production  Medium - and long -term financing for sugar 
cane farming -related activities and sugar cane 
production costs.  18-36 months  n.a. 
Credit line for agro -
industry  Provides Salvadoran entrepreneurs with 
resources to help increase the production, 
manufacturing, processing and export of their 
products.  5-15 years  1-2 years  
Capital return credit 
line  Provides credit to finance the return of capital 
for investments made in expanding or 
maintaining a project, with a view to increasing 
productive capacity and investment in working 
capital.  Up to 15 years  n.a. 
Credit line for the 
consolidation of 
performing debt  Debt consolidation, por tfolio transfers and 
financing for productive activities. Maximum 
amount of funding: USD  3,000,000.  Up to 15 years  According to 
project 
assessment  
Credit line for 
energy efficiency 
and renewable 
energy  Direct funding to support the development of 
investme nt in renewable energies and energy 
efficiency in El Salvador.  Up to 15 years  Up to 4 years  
Guarantee line  Guarantees investment loans, as well as costs 
relating to such investment and to improving 
the production process.  Up to 15 years  n.a. 
Credit line for 
refinancing  Finances the total or partial redemption of one 
or more outstanding BANDESAL loans.  Up to 17 
years,  
according to a 
credit and 
business flow 
analysis  According to 
project 
assessment  
n.a. Not applicable.  
Source:  BANDESAL.  
  WT/TPR/S/440  • El Salvador  
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  Table A3. 3 Main BANDESAL second -tier credit programmes  
Approved name  Description  Term  Grace period  
Investment credit  Provides the resources needed for project 
implementation, including for capital formation 
expenditure and current expenditure or working 
capital.  Over 20 years  Up to 5 years  
Credit line for the 
economic recovery 
of Salvadoran 
MSMEs  Supports MSME sustainability through financing  
provided by  BANDESAL second -tier lines, 
promoting the economic recovery of Salvadoran 
MSMEs through access to credit for working capital 
and investment in fixed assets.  Up to 20 years  Up to 3 years  
Credit line for the 
economic recovery 
of Salvadoran 
female 
entrepreneurs  Supports the sustainability of Salvadoran female -
led MSMEs, through financing provided by 
BANDESAL second -tier lines , promoting economic 
recovery by facilitating access to credit for working 
capital and investment in fixed assets.  Up to 20 years  Up to 3 years  
Credit line to 
support the 
economic revival of 
Salvadoran 
enterprises  Supports the country's economic revival through 
financing for second -tier credit operations for the 
implemen tation of productive projects  via 
degressive modalities  through intermediary 
institutions . Up to 20 years  Up to 2 years  
Purchase of housing  Provides long -term resources to facilitate the 
purchasing of housing in El Salvador.  Up to 20 years  n.a. 
Special credit line 
for transport in 
productive activities  Provides long -term resources to facilitate the 
purchasing of vehicles for use in producti ve 
activities.  Up to 7 years  n.a. 
Special credit line 
for financing the 
productive 
development of 
MSMEs -  IDB funds  Provides medium - and long -term competitive 
resources to financially support the increase in 
productivity of MSMEs in various economic sectors 
so that they can conduct  productive restructuring 
and investment projects.  Up to 15 years  Up to  2 years  
Special credit line 
for female 
entrepreneurs  Helps meet  the working capital and fixed asset 
requirements of female entrepreneurs (natural or 
legal persons) seeking to grow  their businesses , 
who request financing from eligible intermediary 
institu tions.  Up to 6 years  n.a. 
Banca Emprendes 
special credit line  Financial resources to support natural or legal 
persons from the MSME sector who are interested 
in starting an entrepreneurial project.  Up to 8 years  Up to 1 year  
Credit line for 
energy efficiency in 
small and medium -
sized enterprises  Broker s resources through eligible BANDESAL 
institutions  to fund projects on energy efficient 
technologies in small and medium -sized 
enterprises in all sectors of the economy, 
supporting their competitivenes s while reducing 
greenhouse gas emissions, with a view to 
promoting sustainable development.  Up to 20 years  Up to 2 years  
Credit line for 
energy efficiency 
and renewable 
energy  Promotes sustainable development and 
environmental benefits through the granting of 
credit for investments in energy efficiency, 
renewable energy and environmental protection 
projects, in particular for small and medium -sized 
enterprises, without limiting financing for products 
of large and micro enterprises.  Up to 15 years  Up to 3 years  
Coffee plantation 
investment 
programme  Promotes investment in the agricultural sector 
through lines that provide technical and financial 
conditions encouraging growth in that sector, thereby 
contributing to the country's economic recovery.  Up to 8 years  Up to 3 years  
Credit line to support 
coffee disease 
control activities  Finances coffee disease control activities.  Up to 1 year  n.a. 
Credit line for the 
establishment of 
cacao plantations  Finances the establishment of new cacao 
plantations  in conjunction with other crops.  Up to 8 years  Up to 3  years  
Invoice discounting 
line Provides resources so that MSMEs can use invoice 
discounting as a financial instrument to improve 
their cash flow.  Up to 6 
months  n.a. 
n.a. Not applicable.  
Source:  BANDESAL.  WT/TPR/S/440  • El Salvador  
- 148 - 
  Table A3. 4 Main programmes of the Economic Development Fund, BANDESAL  
Approved name  Description  Term  Grace period  
Direct credit line for 
productive activities  Addresses the financial needs of 
agricultural activities with a view to 
increasing productivity and employment.  1-12 years  1-2 years  
Direct credit line for 
investment in coffee 
plantations  Provides financial resources to revive the 
coffee sector through medium - and long -
term funding for coffee -growing related 
activities.  6-8 years  2-3 years  
Credit line to promote 
tourism in El Salvador  Promotes the development, 
competitiveness and improved quality of 
services in all branches of tourism, with 
emphasis on coastal, mountain, medical, 
cultural, business and conference tourism, 
providing financing to MSMEs to transform 
the sector.  1-15 years  1-2 years  
Line for the refinancing 
of loans granted with 
Economic Development 
Fund (FDE) resources  (i) Working capital: finances the total or 
partial redemption of one or more 
outstanding FDE loans, which reflect 
arrears or limited payment capacity and 
which change the conditions of previous 
loans. 
(ii) Investment: finances the total or 
partial redemption of one or more 
outstanding FDE loans, which reflect 
arrears or limited payment capacity and 
which change the conditions of previous 
loans. Up to 15 years, 
taking into account 
that the average 
term of the existing 
loan portfolio is 7 
and a half years  1 year  
Line for the refinancing 
of coffee -growing for 
loans granted with 
Economic Development 
Fund (FDE) resources  Refinances loans for coffee growing.  Up to 4 years more 
than the current 
credit term (not 
applicable in the 
case of working 
capital  financing)  
(Where various 
loans have been 
combined into one, 
the longest loan 
term is that 
considered as the 
new term)  1 year  
Direct credit line for 
coffee production costs  Finances coffee production costs per 
harvest.  18 months  n.a. 
Direct credit line for 
sugar cane production 
costs Finances sugar cane crop production 
costs.  18-36 months  n.a. 
Direct credit line for 
female entrepreneurs  Finances female entrepreneurs from 
MSMEs who are interested in investing in 
producti ve projects that include  capital 
formation expenditure and current 
expenditure or working capital.  3-8 years  1-2 years  
"Banca Emprendes" 
direct credit line  Finances entrepreneurs interested in 
launching productive and/or commercial 
projects or funding existing producti ve 
and/or commercial projects that have 
been in operation for less than two years 
and include investment in capital 
formation and working capital.  5-8 years  Up to 1 year  
Direct credit line to 
support micro -
entrepreneurs and 
manufacturers 
specializing in sch ool 
uniforms, footwear and 
supplies  Provides working capital resources to 
Salvadoran micro -entrepreneurs who 
participate in the Paquete Escolar  (School 
Package) programme and who have a 
supply or production contract awarded by 
a Ministry of Education educational facility.  Up to 18 months  Up to 
10 months  WT/TPR/S/440  • El Salvador  
- 149 - 
  Approved name  Description  Term  Grace period  
Special credit line for 
granting financing to 
eligible BANDESAL 
institutions  and trusts 
administered by the 
Bank Finances second -tier credit operations that 
are conducted through financial 
intermediaries to support and develop 
MSMEs.  - Eligible 
BANDESAL 
institutions : up to 
3 years  
- Trusts: up to 8 
years  n.a. 
Line of financing for 
extraordinary assets of 
the Economic 
Development Fund 
(FDE) Provides access to credit for financing 
extraordinary assets belonging to funds 
administered by BANDESAL.  7-15 years  n.a. 
Direct credit line for 
micro -entrepreneurs  Directly finances micro -entrepreneurs 
interested in investing in producti ve 
projects that include  capital formation 
expenditure and current expenditure or 
working capital.  3- 8 years  1-2 years  
Line for investment in 
the chemical -
pharmaceutical 
industry  Promotes the competitiveness of the 
pharmaceutical industry production chain 
through access to fina ncing for the 
restructuring of production.  2-15 years  2 years  
Direct credit line for 
the promotion of 
housing and 
construction projects  Provides short - and medium -term financial 
resources for the development of new 
housing and construction projects.  3 years  n.a. 
Credit line for the 
promotion of 
agricultural activities  Provides financial resources to revive the 
coffee sector through mediu m- and long -
term financing for coffee -growing 
activities.  3-10 years  Up to 4 years  
n.a. Not applicable.  
Source:  BANDESAL.  
  WT/TPR/S/440  • El Salvador  
- 150 - 
  Table A3. 5 Main Salvadoran Guarantee Fund (FSG) programmes  
Destination  Description  Maximum 
term  
Exportation  Guarantees for export working capital loans backed up by invoices or 
purchase orders. Coverage: 50% -70%.  
Maximum amount automatically guaranteed: USD  200,000.  1 year  
MSMEs  Guarantees for working capital loans, capital formation and transport.  
Coverage: 50% -70%.  
Maximum amount: USD  75,000 -USD 100,000.  5 years  
Producti ve 
activities  Guarantees for working capital loans, capital formation and production -
related transport. Coverage: 50% -70%. Maximum amount: USD  200,000. 
Includes a special activity guarantee line for large enterprises, with a 
maximum guarantee amount equivalent to 3% of the FSG's base capital.  8 years  
Factoring  Guarantees for loans through factoring operations. Coverage: 50%.  
Maximum amount: USD  100,000.  6 years  
Multipurpose  Guarantees for working capital loans, capital formation and mixed capital. 
Coverage: 50% -70%.  
Maximum amount: USD  200,000.  6 years  
Revolving 
credit 
(working 
capital)  Guarantees for loans through revolving lines for working capital. 
Coverage: up to 50%.  
Maximum amount: USD  200,000.  4 years  
Innovation  Guarantees for working capital loans, technological development, 
renewable energy generation, certification and environmental conversion. 
Coverage: 50% -70%.  
Maximum amount: USD 50,000 -USD 200,000.  7 years  
Tourism  Guarantees for capital formation loans: purchase of machinery and 
equipment, software, transport, etc. Coverage: 70%.  
Maximum amount: USD  200,000.  8 years  
Health  Guarantees for capital formation loans: purchase or repair of machinery 
and equipment. Cover age: 50%.  
Maximum amount: USD  200,000.  5 years  
Education  Guarantees for loans for technical -,high- or postgraduate -level studies in 
El Salvador or abroad. Maximum coverage: 90%.  
Maximum amount: USD  36,000.  15 years  
Banca Mujer  Guarantees for female ent repreneurs (natural or legal persons) who have 
access to working capital loans and capital formation. Coverage:  70%.  
Maximum amount: USD  75,000.  6 years  
Banca 
Emprendes  Guarantees for natural or legal persons seeking to  launch an 
entrepreneurial project and/or established enterprises in operation for less 
than a year that need to develop new business undertakings. Working 
capital loans and capital formation. Maximum coverage: 90%.  
Maximum amount: USD  75,000.  8 years  
Orange 
economy  Guarantees for loans relating to the orange economy (or creative 
economy ), which is based on talent, intellectual property, connectivity and 
cultural heritage. Working capital loans and capital formation . Maximum 
coverage: 70%.  
Maximum amount : USD  100,000.  8 years  
Impulso 
mipymes  Business guarantee s including return of capital, debt transferral, 
consolidation of operations with the same eligible institution or with 
another institution. Includes consolidation, return s and refinancing. 
Maximum coverage: 50%.  
Maximum amount: USD  100,000.  8 years  
Preferential 
client  Fee reduction in the guarantee registration and renewal process for 
returning clients benefiting from the FSG who have demonstrated 
appropriate use of the guarantee product.   
Source:  BANDESAL.  
__________  