The government of El Salvador will inject $1 billion in liquidity into the national economy in the coming days, President Nayib Bukele announced yesterday. The measure, made possible by a recent agreement with the International Monetary Fund (IMF), is equivalent to 2.8% of the country’s gross domestic product (GDP) and is intended to stimulate economic activity, particularly among micro, small, and medium-sized enterprises (MSMEs).
“This injection aims to boost the economy in the short term, increasing the flow of capital into the domestic market and stimulating commercial and productive activity,” President Bukele stated. The funds will be channeled through advance payments to MSMEs and suppliers, as well as the repayment of domestic debt. According to the president, these steps are designed to support the most vulnerable sectors of the economy, which are essential for sustained growth and job creation.
Importantly, the president emphasized that the liquidity will be provided in U.S. dollars already available in international markets, rather than through the issuance of local currency. “Because these are currencies already available in international markets, and not local currency issuance, an inflationary impact is avoided,” Bukele wrote on his X account. He further noted that the strategy is aimed at stimulating consumption and commercial sales while maintaining macroeconomic stability.
To help the general public better understand the implications of the measure, the president asked Grok, an artificial intelligence chatbot integrated into X, to explain the initiative in simple terms. “The government is going to inject $1 billion into the economy to help small businesses and suppliers,” Grok responded. “This means these companies will be paid sooner, giving them money to grow, hire more people, and maintain stable prices.”
Grok added that domestic debts would also be paid to further strengthen the economy, potentially leading to job creation, stable prices, and a more favorable business climate. The AI stressed that the move would not involve printing new money, as the resources are part of a broader IMF-supported financial strategy.
When asked about the future of El Salvador’s economy under Bukele’s leadership, Grok responded that the $1 billion stimulus could push GDP growth beyond 3% in 2025, spur job creation, and attract investment. The chatbot also highlighted the potential of Bitcoin to position El Salvador as a global leader in financial innovation, though it cautioned that successful implementation and transparency would be critical.
Regarding the nation’s ability to manage its public debt, Grok affirmed that with IMF backing and planned reforms, El Salvador is in a position to reduce its debt-to-GDP ratio, currently at 85%. The $1.4 billion, 40-month IMF program—announced in February under the Extended Fund Facility (EFF)—includes an immediate disbursement of $113 million and is designed to enhance fiscal discipline and governance.
The agreement also opens the door to additional multilateral funding from institutions such as the World Bank, the Inter-American Development Bank (IDB), the Central American Bank for Economic Integration (CABEI), and the Development Bank of Latin America (CAF). These resources, which could total more than $3.5 billion, will support economic stabilization efforts and promote inclusive and sustainable growth.
According to the government, this comprehensive package of financial measures reflects a strong commitment to revitalizing the national economy while laying the foundation for long-term prosperity.