El Salvador profile

Demography and Health

El Salvador has a population of about 6.34 million as of 2024, with a negative net migration of around 23,100 people in the same year, suggesting outward movement that could affect labor supply and demographic dynamics over time. The birth rate stands at 15.8 per 1,000 people and the crude death rate at 7.52 per 1,000, which together yield a modest natural increase that supports a still-young population structure but not an accelerated population boom. Life expectancy at birth is 72.1 years, and the under-5 mortality rate is 10.4 per 1,000 live births, indicating ongoing health challenges for children but improvements relative to many peers in the region. Health expenditure is 9.84% of GDP in 2022, with domestic general government health expenditure per capita (PPP) at about 675 international dollars and a physician density of 1.55 per 1,000 people, along with 1.16 hospital beds per 1,000 people (2021), suggesting a health system that provides essential services but still faces access and capacity constraints. The country’s poverty headcount at the national poverty line is 26.6% (2022), and undernourishment affects 6.8% of the population (2022), underscoring persistent, though not extreme, material hardship and the importance of social protection and nutrition programs. In the digital sphere, 67.7% of the population used the Internet in 2023, reflecting growing connectivity that can enable health information, telemedicine, and education, even as disparities persist. Overall, health and demographic indicators point to progress in health outcomes and living standards, but significant work remains to close gaps in child health, nutrition, access to care, and poverty reduction, which will shape El Salvador’s human development trajectory in the coming years.

Economy, Trade and Investment

El Salvador’s economy shows a mix of moderate macro stability and openness with a GDP per capita of 5,580 current US$ and a GDP per capita at purchasing power parity of 13,264 international dollars (2024). The country is moderately integrated into global trade, with exports of goods and services comprising 32.8% of GDP (2024) and imports representing 51.9% of GDP, signaling a relatively open but import-dependent economy. Inflation remains subdued at 0.854% in 2024, contributing to price stability, while unemployment is reported at 2.99% in 2023, a surprisingly low figure that could reflect underemployment or data limitations typical of economies with large informal sectors. Foreign direct investment net inflows amount to 2.61% of GDP in 2024, signaling a measured but real role for foreign capital in expansion and modernization. The current account balance stands at −1.79% of GDP (2024), indicating a moderate external deficit that must be financed by capital inflows or reserves, but not at crisis levels. High-technology exports reached 247 million US$ in 2024, with a notable global rank of 18 for the value of these exports, suggesting El Salvador punches above its size in certain advanced sectors despite a small overall economy. Domestic innovation activity appears limited, with residents filing only 2 patent applications in 2021 and research and development expenditure at 0.143% of GDP in 2022, highlighting a nascent but growing emphasis on knowledge creation. The country’s strategic position is reinforced by a logistics infrastructure that scores 2.2 on the Logistics Performance Index (quality of trade and transport-related infrastructure, 1=low to 5=high) in 2022, and a relatively solid capacity for trade facilitation given a regional ranking of 24, indicating strengths in cross-border commerce. While renewable energy provides 21.9% of total final energy consumption (2021), overall energy intensity and diversification remain important horizons for investment. Poverty reduction remains a priority given the 26.6% national poverty rate (2022) and 6.8% undernourishment (2022), highlighting the need for inclusive growth and targeted social programs to maximize the impact of macro reforms. Taken together, El Salvador’s economy shows resilient growth prospects anchored by export-oriented niches, a stable price environment, and an improving but still modest innovation ecosystem, with the ongoing implication that governance quality and institutional clarity will significantly influence future investment and productivity gains.

Governance and Institutions

El Salvador’s governance indicators point to a mixed institutional landscape. Political stability and absence of violence/terrorism register a marginally positive reading at 0.00233 in 2023, suggesting limited but real risk of political disruption. However, regulatory quality (-0.308) and the rule of law (-0.369) mark meaningful governance weaknesses, and control of corruption sits at −0.561 in 2023, signaling persistent challenges for accountability and anti-corruption enforcement. Government effectiveness is modest at 0.0504 in 2023, indicating limited capacity to design and implement policy across agencies. These governance signals can translate into practical investment frictions, including slower permit processes, inconsistent regulatory enforcement, and higher compliance costs for firms. The country’s external orientation is evident in foreign direct investment inflows as a share of GDP of 2.61% (2024), suggesting that investors still rely on a governance context that offers relative stability but demands robust risk management. Taken together, El Salvador exhibits a trajectory of gradual institutional maturation but faces substantive governance headwinds that can influence the efficiency of public services, the predictability of policy, and the attractiveness of long-term investments.

Infrastructure and Technology

Infrastructure in El Salvador features a mixed but generally improving profile. The Logistics Performance Index (quality of trade and transport-related infrastructure) stands at 2.2 (2022), with a regional rank around 24, indicating mid-range efficiency in trade logistics and transport systems. Digital connectivity has grown, with 67.7% of the population using the Internet in 2023, signaling broad digital inclusion that can underpin e-government, e-commerce, and telehealth. The country records high-technology exports valued at about 247 million US$ in 2024, and a global ranking of 18 for these exports, suggesting a niche but notable strength in advanced manufacturing or related sectors. Yet domestic innovation remains limited, with only 2 patent applications filed by residents in 2021 and R&D expenditure at 0.143% of GDP in 2022, underscoring a gap between potential and outcomes in science and technology. The health and education infrastructure shows moderate capacity, with physicians at 1.55 per 1,000 people (2022) and hospital beds at 1.16 per 1,000 (2021). Renewable energy accounts for 21.9% of total final energy consumption (2021), reflecting early diversification toward cleaner power, while per-capita greenhouse gas emissions sit at about 2.07 tons of CO2 equivalent (2023). Overall, the infrastructure and technology landscape indicates solid connectivity and open trade lanes, complemented by emerging but still underdeveloped innovation ecosystems that require policy support and private-sector collaboration to reach higher productivity dividends.

Environment and Sustainability

On the environmental front, El Salvador faces a mix of pressures and progress. The level of water stress, measured as freshwater withdrawal as a share of available resources, stands at 13.2% (2021), indicating that freshwater resources are not yet severely strained but require sustainable management to avert future stress as demand grows. Total greenhouse gas emissions per capita, excluding land use, land-use change, and forestry (LULUCF), are about 2.07 t CO2e per person in 2023, reflecting a modest per-capita emissions footprint relative to larger economies, yet a meaningful contribution given population size. Renewable energy contributes 21.9% of total final energy consumption (2021), signaling progress toward cleaner energy sources but still leaving a large share of energy demand met by non-renewables. The country’s development path thus benefits from investments in energy transition, climate resilience, and adaptation to environmental risks, including water management and disaster preparedness, especially given the volatility that climate and natural hazards can introduce to an economy with significant trade exposure. Collectively, El Salvador's environmental indicators show a trajectory toward lower-carbon energy and prudent resource management, while highlighting vulnerabilities that require sustained policy attention and investment in sustainable infrastructure and natural-resource governance.