El Salvador’s government-led economic strategies allowed the country to close last year with an inflation rate of 7.2%, the lowest in Central America and the third lowest in Latin America, according to the Central Reserve Bank (BCR).
The BCR reiterated that El Salvador closed 2022 with an inflation rate of 7.2%, the lowest in Central America and the third lowest in Latin America, thanks to the economic strategies implemented by the government a year ago to contain adverse international effects.
“The 11 measures launched by President Nayib Bukele against inflation undoubtedly led to a decrease in inflation and allowed El Salvador to position itself as a benchmark in the world,” said Douglas Rodriguez, president of the BCR.
Rodriguez explained that among those measures is the fixing of fuel prices, which positioned itself as one of the main strategies that benefited the pockets of thousands of Salvadoran families; and the exemption of import taxes on basic basket products, a measure that was recently extended until 2024.
Also, according to the head of the BCR, the work carried out by government institutions to verify and supervise that these inflationary measures are applied and benefit Salvadorans also allowed the country’s inflation indices to be lower than economies such as that of the United States, which recorded a 9.1%, the highest rate in the last 40 years.
This statement is consistent with that presented by the Central American Monetary Council, which indicated that at the end of 2022, El Salvador obtained the best inflation rate in the region at 7.3%.
“The lowest inflation rates at the end of 2022 were recorded in El Salvador (7.3%), Costa Rica (7.8%), and the Dominican Republic (7.8%). Honduras and Guatemala achieved rates of 9.2% and 9.8% in the same order, while Nicaragua recorded the highest rate in the region at 11.5%,” the institution’s latest report states.
On the other hand, the report states that, despite adverse impacts, the Central American economy grew at a relatively solid pace in 2022, partly due to the contribution of remittance income to economic activity dynamics.
In terms of the amounts received, the main recipients of remittances were Guatemala with $18,040.3 million, followed by the Dominican Republic ($9,856.5 million), Honduras ($8,686.2 million), El Salvador ($7,742 million), and Nicaragua ($3,224.9 million).