High remittances and low exports in El Salvador

The Central Reserve Bank confirmed that remittances from abroad, one of the pillars of the local economy, amounted to $558 million in January, an increase of $6.5 million over the previous year.

While commodity exports ended with a decrease of 9.7% on an annual basis, meaning that products worth $522.5 million were sold abroad, which is about $56.3 million less than the same stage of 2022.

BCR determined that one of the items that contributed the least to sales to overseas markets was contract textiles.

The Bank said this week that 49 percent of families in El Salvador would fall into poverty if they stopped receiving aid from abroad.

Cash transfers are one of the main drivers of the economy by contributing funds that amounted to seven thousand and 742 million dollars last year, higher than foreign investment and exports.

The bank confirmed that 83.1% of families that receive transfers are classified as non-poor, and 16.9% as poor.

A survey indicated that just under a year before the presidential elections in February 2024, it is alarming that half of those consulted feel the situation of the economy is getting worse or expect that future in the household economy, 51 percent, with a 43.9 percent believing that better times She will come

In the case of family assistance items, they are mainly used for consumption and support 25 percent of households, while exports are a reflection of the dynamics of production and external demand.

According to experts, both indicators predict that if the largest economy in the world, the United States, slows down or falls into recession due to interest rate adjustments by the Federal Reserve (Fed), in its attempt to contain inflation, this will greatly affect the economy. Salvadoran situation.

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