In the first quarter of 2024, Central America saw a significant surge in service exports, increasing by 35.2%, according to a joint report from the Central American Integration System (SICA) and the Secretariat for Central American Economic Integration (SIECA). The report, released in October, highlights that El Salvador contributed $1.5 billion to the region’s service exports during this period.
The key drivers behind this growth were the travel, transportation, and manufacturing services sectors, which collectively accounted for 79.2% of the total exports. These three sectors saw an impressive 47.2% increase. In contrast, other sectors like telecommunications, IT services, and business services experienced only a 3.2% rise and made up the remaining 20.8%.
Regional service exports reached a total of $12.3 billion by the end of Q1, reflecting a 10.2% increase compared to the same period in 2023. Panama and Costa Rica emerged as the top exporters, contributing 36.2% and 35.2% respectively, while El Salvador, Guatemala, Honduras, and Nicaragua together represented 28.6%.
On the import side, Costa Rica was the region’s largest buyer of services, accounting for 27.2% of the $6.3 billion in services imported. Guatemala and Panama followed with 24.1% and 22.3%, while Honduras, El Salvador, and Nicaragua had smaller shares.
El Salvador’s service imports rose by 11.2% in Q1, amounting to $693.9 million, with travel, transportation, and insurance sectors being the primary contributors. The country also posted a service trade surplus, in contrast to its deficit in goods trade.
While El Salvador’s service exports grew, its goods exports fell by 13.7%, totaling $1.5 billion, leading to a trade deficit of $2.2 billion due to higher imports. Despite this, combined service and goods exports reached $3 billion for the quarter.
Looking ahead, the Central American Monetary Council forecasts a 2% growth in total exports for 2024, while Salvadoran exporters project a 1% rise, potentially reaching $11 billion.