El Salvador has achieved a "CCC+" rating in the Fitch Rating thanks to the payment of bonds at the beginning of the year. The same rating agency detailed that its expectations have been surpassed by the measures taken by the Salvadoran government to comply with its debt obligations, which implies that the probabilities of default are non-existent.

One of these measures implemented is the reduction of the fiscal deficit, bringing it down to 2.5% of GDP in 2022, compared to 2020 (10.1%) and 2021 (5.5%), which translates to a steady work of solid tax collection and a committed reduction of expenditures.

The repurchase of sovereign bonds has also been hailed as a resounding success, as a reduction in outstanding debt from $800 million to $348 million was achieved.

In addition to this, the government of El Salvador reached 75.9% in non-financial public sector debt, compared to 88.1% in 2020 and 80.4% in 2021.

According to Fitch, the projections for El Salvador are very good, as a downward trend in public debt/GDP and a continuation of the good course for fiscal consolidation are expected.

Translated by: A.M