San Salvador El Salvador. SAN SALVADOR, El Salvador — The Economic Commission for Latin America and the Caribbean (ECLAC or CEPAL) has lowered its 2025 growth forecast for El Salvador to 2.5%, underscoring the growing uncertainty clouding the region’s economic outlook.
The revised projection, released Tuesday, is half a percentage point lower than ECLAC’s estimate in December 2024.
The updated figure now mirrors the International Monetary Fund’s (IMF) forecast, which anticipates modest expansion as the country undertakes a 3.5% fiscal adjustment over the next 40 months.
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|
| El Salvador | -7.9 | 11.2 | 2.8 | 3.5 | 2.6 | 2.5 |
Meanwhile, the World Bank expects 2.2% GDP growth this year, following revised projections shared during its spring meetings last week.
Following the IMF update, President Nayib Bukele expressed optimism on social media platform X, claiming the country “can double these results,” suggesting potential GDP growth of up to 5%.
Central America
In Central America, the Economic Commission for Latin America and the Caribbean (ECLAC) has revised its 2025 growth forecast to 2.7%, a 0.2 percentage point decrease from its earlier estimate.
The U.N. agency adjusted its growth forecasts for Costa Rica, El Salvador, Guatemala, and Nicaragua downward while maintaining earlier projections for Honduras and Panama.
Costa Rica is expected to lead the region with 3.6% growth this year, though that figure is below both the 4.3% expansion recorded in 2024 and ECLAC’s December estimate.
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|
| Costa Rica | -4.3 | 7.8 | 4.6 | 5.1 | 4.3 | 3.6 |
| Guatemala | -1.8 | 8.0 | 4.2 | 3.5 | 3.7 | 3.3 |
| Honduras | -9.0 | 12.5 | 4.1 | 3.6 | 3.6 | 3.2 |
| Nicaragua | -1.8 | 10.4 | 3.8 | 4.6 | 3.6 | 3.1 |
| Panama | -17.7 | 15.8 | 10.8 | 7.3 | 2.9 | 3.1 |
| El Salvador | -7.9 | 11.2 | 2.8 | 3.5 | 2.6 | 2.5 |
Guatemala follows Costa Rica with a projected growth of 3.3% in 2025, down 0.2 percentage points from the previous estimate.
Honduras ranks third with an unchanged forecast of 3.2%, slower than the 3.6% recorded in 2024.
Nicaragua and Panama share fourth place, each expected to grow by 3.1%. El Salvador is last in the region, with its outlook cut by 0.5 points to 2.5%.
Panama is the only country in Central America with an improved economic forecast. ECLAC predicts its economy will grow by 3.1% this year, an increase from 2.6% in 2024.
Last year, Panama’s economy was negatively impacted by a water shortage affecting the Panama Canal and the shutdown of the region’s largest copper mine.
The mine remains shut down, but ongoing negotiations between the Panamanian government and the operator have fueled cautious optimism in financial markets.
