San Salvador, El Salvador Capital City
The International Monetary Fund (IMF) projects that El Salvador’s economy will grow by 3.3% in 2026, placing the country above the expected growth rate for Latin America and the Caribbean.
The latest projection also represents an improvement from the IMF’s previous outlook. It falls within the 3% to 3.5% growth range forecast by El Salvador’s Central Reserve Bank (BCR).
The IMF stipulates that economic activity in the country is expected to maintain the positive momentum recorded in recent years, with construction, tourism, exports, services, trade, and private investment—the sectors contributing to the country’s economic expansion.
According to the IMF’s latest World Economic Outlook, El Salvador‘s projected 3.3% growth would exceed the 2.3% expansion anticipated for Latin America and the Caribbean as a whole during 2026.
The new estimate is considerably stronger than the IMF’s October forecast, when the organization projected Salvadoran economic growth of 2.5% for 2026, representing an upward revision of 0.8 percentage points.
The IMF estimate is slightly higher than the World Bank’s latest forecast, which projects 3.2% economic growth for El Salvador in 2026. Meanwhile, ECLAC expects 3.3% economic growth, matching the IMF’s projection.
Lastly, the BCR expects economic growth between 3% and 3.5% this year, arguing that favorable economic conditions should allow El Salvador to continue the stronger growth trajectory registered recently.
The BCR noted that the current forecast surpasses the roughly 2% average recorded between dollarization in 2001 and 2019, as well as the 2.3% average registered from 2014 through 2018.
Private investment is expected to be one of the principal engines of economic activity during 2026, supported by improved business confidence, public-security conditions, and government efforts to attract additional investment.
According to the BCR, El Salvador has a portfolio of private investment projects valued at more than $9 billion, involving infrastructure, machinery, equipment, construction, services, commerce, tourism, and other economic activities.
Latin America and the Caribbean Growth Outlook
For Latin America and the Caribbean, the IMF now forecasts economic growth of 2.3% in 2026, an increase of 0.1 percentage points compared with its previous projection released in January.
The organization also warned that geopolitical instability, including the effects of conflict in the Middle East, could affect Latin American economies differently depending on trade exposure, energy prices, investment conditions, and other factors.
