El Salvador Economy - 2005

Economy - overview:
GDP per capita is roughly half that of Brazil, Argentina, and Chile, and the distribution of income is highly unequal. The government is striving to open new export markets, encourage foreign investment, modernize the tax and healthcare systems, and stimulate the sluggish economy. Implementation of the Central America-Dominican Republic Free Trade Agreement, ratified by El Salvador in 2004, is viewed as a key policy to help achieve these objectives. The trade deficit has been offset by annual remittances from Salvadorans living abroad - 16% of GDP in 2004 - and external aid. With the adoption of the US dollar as its currency, El Salvador has lost control over monetary policy and must concentrate on maintaining a disciplined fiscal policy.

GDP:
purchasing power parity - $32.35 billion (2004 est.)

GDP - real growth rate:
1.8% (2004 est.)

GDP - per capita:
purchasing power parity - $4,900 (2004 est.)

GDP - composition by sector:
agriculture: 9.2%
industry: 31.1%
services: 59.7% (2004 est.)

Labor force:
2.75 million (2004 est.)

Labor force - by occupation:
agriculture 17.1%, industry 17.1%, services 65.8% (2003 est.)

Unemployment rate:
6.3% - but the economy has much underemployment (2004 est.)

Population below poverty line:
36.1% (2003 est.)

Household income or consumption by percentage share:
lowest 10%: 1.4%
highest 10%: 39.3% (2001)

Distribution of family income - Gini index:
52.5 (2001)

Inflation rate (consumer prices):
5.4% (2004 est.)

Investment (gross fixed):
16.6% of GDP (2004 est.)

Budget:
revenues: $2.491 billion
expenditures: $2.782 billion, including capital expenditures of NA (2004 est.)

Public debt:
41.7% of GDP (2004 est.)

Agriculture - products:
coffee, sugar, corn, rice, beans, oilseed, cotton, sorghum; shrimp; beef, dairy products

Industries:
food processing, beverages, petroleum, chemicals, fertilizer, textiles, furniture, light metals

Industrial production growth rate:
0.7% (2004 est.)

Electricity - production:
4.158 billion kWh (2004)

Electricity - consumption:
4.45 billion kWh (2004)

Electricity - exports:
91 million kWh (2004)

Electricity - imports:
473 million kWh (2004)

Oil - production:
0 bbl/day (2001 est.)

Oil - consumption:
39,000 bbl/day (2001 est.)

Oil - exports:
NA

Oil - imports:
NA

Current account balance:
$-880.5 million (2004 est.)

Exports:
$3.249 billion (2004 est.)

Exports - commodities:
offshore assembly exports, coffee, sugar, shrimp, textiles, chemicals, electricity

Exports - partners:
US 57.9%, Guatemala 13.6%, Honduras 7% (2004)

Imports:
$5.968 billion (2004 est.)

Imports - commodities:
raw materials, consumer goods, capital goods, fuels, foodstuffs, petroleum, electricity

Imports - partners:
US 37.3%, Guatemala 9%, Mexico 6.1% (2004)

Reserves of foreign exchange and gold:
$1.888 billion (2004 est.)

Debt - external:
$4.792 billion (September 2004 est.)

Economic aid - recipient:
$125 million of which, $53 million from US (2003)

Currency (code):
US dollar (USD)

Exchange rates:
the US dollar became El Salvador's currency in 2001