In january, the multilateral organization projected a 4% growth for El Salvador, but then in april lowered it to 2.9% and two months later lowered that projection to 2.7%.

In 2021, economic growth rebounded to 10.7 percent, supported by remittance-driven consumption and exports.

Other challenges remain for El Salvador, such as the need to advance reforms for fiscal sustainability. The fiscal response to the COVID-19 crisis helped mitigate its impacts, cost about 15 percent of GDP and, together with low revenues and rigid expenditures, pushed public debt to over 90 percent of GDP.

To avoid debt overhang, El Salvador requires fiscal consolidation to improve revenue mobilization and increase spending efficiency, while protecting economic recovery and people in poverty. A sound fiscal package can also help El Salvador reduce refinancing risks.

The poverty rate (based on a poverty line of US$5.5 per person per day) declined from 39 percent in 2007 to 22.3 percent in 2019. Extreme poverty, measured at US$1.90 per day, declined from 13 percent in 1995 to 1.5 percent in 2019.

Driven by pro-poor growth and more shared prosperity, El Salvador became the most equal country in Latin America and the Caribbean (LAC). The Gini index fell from 0.54 in 1998 to 0.38 in 2019, the lowest in the region.