Thursday, 11 April 2024 02:49

Investment to combat violence cost El Salvador between 14% and 19% of GDP

Written by Karla Gutiérrez

In a television interview, the President of the Banco Central de Reserva, Douglas Rodriguez, specified that violence cost El Salvador around 14% to 19% of the Gross Domestic Product (GDP).

The head of the BCR, said that what is obtained in remittances, was very similar to the expenditure that was had to combat violence in the country, this was not only paid by the Government, but, small, medium and large companies including transnationals who invested in security such as: video surveillance cameras, security personnel, extortion, among other expenses that in the end were millions of dollars to be paid for the insecurity that the country was going through, not counting the cases of homicides, kidnappings and robberies that also involved more expenses.

Although it is true that security is not an economic issue, it does directly affect the economy, which is why public policies should be improved to help El Salvador's economy grow.

Now the central government created strategies, which led the country to experience an economic growth at the end of 2023 of 3.5%, driven by a sustained growth of the main economic activities such as construction.

Even now, transnational companies in El Salvador have had a record in three consecutive years with one billion dollars in profits, that last year these companies had around one billion four hundred million dollars in profits, according to data from the Banco Central de Reserva.

Something very important that these companies are doing is that they are no longer taking their profits out of the country, but are investing them in El Salvador, which is very beneficial for the region.

According to BCR data, if this trend continues, the numbers of foreign investment will be better than the results of 2023, in which US$759.7 million of investment was obtained.



Translated by: A.M