El Salvador’s Central Reserve Bank (BCR) Forecasts 2.6% Economic Growth in 2023

By Eddie Galdamez  |  Oct 11th, 2023
El Salvador’s Central Reserve Bank BCR Economic Outlook
Street market in San Salvador, El Salvador. Photo by Depositphotos.com

The Salvadoran Central Reserve Bank (BCR) predicts that El Salvador’s economy will grow by 2.6% in 2023, driven by an increase in the development of public and private investment projects and by the energizing effect that the security improvement has had in various activities.

Central Reserve Bank’s president Douglas Rodríguez reported the expected economic growth during a September 28, TV interview.

In other conferences we had said that El Salvador was going to grow between 2% and 3%. Now, with more recent information, we confirm that El Salvador will grow by 2.6%, which is higher than the average of the last 30 years, which was 2.1%.” Douglas Rodriguez, BCR President.

El Salvador’s Central Reserve Bank (BCR) Economic Outlook
2017 2018 2019 2020 2021 2022 2023
2.3 2.4 2.5 -7.9 11.2 2.6 2.6
Source: BCR

In March 2023, Rodriguez announced that the BCR was projecting an economic growth range of 2% to 3%, supported by the continuity of tourism, public security, the development of strategic public investment projects, and the confidence of private investors.

The Salvadoran Central Reserve Bank’s 2023 economic projections are near the 2.8% estimated by the World Bank’s economic outlook for the country.

On the other hand, the projection is higher than the 2.2% predicted by the International Monetary Fund (IMF) and the 2.1% of Latin America and the Caribbean (ECLAC).

El salvador’s Economy Grew 3.0% in the Second Quarter of 2023

Rodriguez also detailed that in the second quarter, the Salvadoran economy registered an increase of 3% in the Gross Domestic Product (GDP), thanks to the growth in 17 of the 19 economic activities in the country.

According to Rodriguez, the top economic activities in 2023 are Construction (22%), Electricity (16.8 %), Professional, technical, and scientific services (11.4 %), Mines and quarries (9.4 %), Leisure (8.4%), Government Services (6.7 %), and Financial Services with 6.2%.

Other contributing factors to the economic increase were the development of international surf tournaments and the XXIV Central American and Caribbean Games.

These events generated an increase in demand for local products and services related to leisure activities, hotels and restaurants, transportation and other business support services.