Despite inflation, micro and small businesses in El Salvador operate with confidence

Currently, the government of President Nayib Bukele implements different initiatives to increase the productivity and well-being of Salvadoran entrepreneurs, including mypes, which, according to the database of the National Commission for Micro and Small Businesses (Conamype), represent 97% of the companies in the country.

According to a recent study on informal business dynamics, prepared by the Fusai Mype Observatory, global actors such as the inflationary behavior of prices in products and raw materials, as well as other economic inconveniences, did not prevent the confidence of mype entrepreneurs from growing by almost one percentage point at the end of the first quarter of 2022.

Despite these international problems, which may affect the country, the Observatory highlights the fact that for nine consecutive months, the sector has maintained a path of growth.

In this scenario, the report details that the Business Confidence Index went from 100 to 103.6 points, between the first quarter of this year and the same period of 2021, reflecting significant growth for Salvadoran businessmen.

Likewise, a score above 20 is reflected, which indicates that businessmen consider that the economy will present favorable growth in the coming months, estimating that they will see a return on their investments.

In addition, the report indicates that, at the end of the first quarter of this year, six consecutive periods have been reached in which the confidence of businessmen is at a level of «moderate optimism» with an indicator of 34.6, equivalent to a position of momentum in investment, employment, and prudent business production in the short term.

The entrepreneurs surveyed also responded that they had closed the quarter favorably in the performance of their businesses compared to the last quarter of 2021. The combination of these opinions gives a balanced view of the economic situation of the businesses of 17.1 percent.

Regarding the expectations for the end of this quarter, businessmen are confident that sales will register an increase and thus have a better performance compared to the period just ended.

The flexibility and adaptability of the subsistence microenterprise allow it to position itself in first place as the segment with the best dynamism in the first quarter, with a confidence index of 107.1.

Likewise, the first quarter of 2022 has also been very favorable for the small business segment, which went from 101.1 to a score of 104.1.

On the other hand, the report indicates that, regarding the economic sectors, businessmen dedicated to transportation are at the forefront with a good climate of trust, achieving a score of 104.7; while production has a score of 103.9; followed by trade with 103.2; the agricultural sector with 102.3; and in last place, services with 100.9 points.

«Mypes supports five million Salvadorans, and by law they must be empowered, and we are working on that. Our task is to ensure that there is growth. There are 1.8 million entrepreneurs in the country. 97% of people have mypes, and some of them live on subsistence without accumulating wealth.» Paul Steiner, president of Conamype

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