EL SALVADOR · ECONOMY
Key Facts
- —What is happening The UN regional commission ECLAC raised its 2026 growth forecast for El Salvador to 4.5% on Thursday, 22 October, up from 3.9% in its August update.
- —Why it matters El Salvador uses the US dollar and relies heavily on money sent home, mostly from the United States, so faster growth touches US families, travellers and investors with Salvadoran exposure.
- —The numbers ECLAC sees 4.1% growth in 2027 and only 2% for Latin America and the Caribbean in 2026. The World Bank and the IMF both put El Salvador at 4.5% this year.
- —Who is who ECLAC (CEPAL in Spanish) is the UN’s regional economic commission. The Central Reserve Bank (BCR) is El Salvador’s central bank and expects 4.5% to 5% growth.
- —What to watch The BCR’s next quarterly growth figure, the effect of El Niño on crops and hydropower, and whether the Middle East conflict pushes prices higher.
- —What it means for you A steadier Salvadoran economy helps families sending money home, but all four figures are forecasts, and farm output fell in the second quarter.
The UN regional commission ECLAC now expects El Salvador’s economy to grow 4.5% in 2026. That is the same pace as the World Bank and the IMF forecast.
The UN regional economic commission ECLAC raised its 2026 growth forecast for El Salvador to 4.5% on Thursday, 22 October. That is 0.6 percentage points above the 3.9% it gave in August, Diario El Mundo and El Salvador in English report.
El Salvador uses the US dollar, and remittances sent mostly from the United States equal about 24% of its output, EFE reports. A stronger economy at home therefore matters to US families, travellers and investors.
What ECLAC Changed on Thursday
ECLAC, known in Spanish as CEPAL, is the UN commission that tracks the region’s economies. Its October update lifts El Salvador’s 2026 figure from 3.9% to 4.5% and sees 4.1% in 2027.
The commission cuts its forecast for Latin America and the Caribbean to 2% in 2026, after 2.4% growth in 2025. For 2027 it expects 2.5%, citing an international context of high uncertainty.
Among Latin American economies, ECLAC lists Venezuela first at 6.5%. El Salvador, Panama and Paraguay follow at 4.5% each, according to the list in Diario de Hoy.
The Dominican Republic is at 4.4% and Guatemala at 4.1%. Diario El Mundo adds that Guyana, at about 22%, is far ahead if the Caribbean is counted.
In Central America, ECLAC lists Nicaragua at 3.7% and Costa Rica and Honduras at 3.5%. For comparison, it puts Mexico at 1.6% and Brazil at 2.1%.
Three Other Forecasters Already Agree
The World Bank put El Salvador at 4.5% for 2026 in its Latin America outlook of Tuesday, 6 October. That was its third upgrade this year, after 3% in January and 3.2% in June.
The bank credits lower crime since 2022, fiscal consolidation and solid private investment. It expects 3.9% in 2027, after 3.9% growth in 2025.
The International Monetary Fund kept its 4.5% figure for 2026 in the World Economic Outlook released on Monday evening, 12 October. It sees 4% in 2027, inflation of 2.7% this year and unemployment of 4.3%.
El Salvador’s Central Reserve Bank (BCR) forecasts 4.5% to 5% for 2026, up from 3% to 3.5% in March. It said so on Monday, 31 August.
What Is Driving the Growth
The BCR figures, reported on Wednesday, 30 September, show GDP up 5.1% in the second quarter, against 4.8% in the first. Construction led with 11.2%, helped by 30.9% growth in construction credit through June.
Electricity and gas rose 8.1% and mining 7.9%, while accommodation and services grew 6.3%. Agriculture shrank 0.95%, and Diario El Mundo links El Niño to crop losses, lower water levels and weaker hydropower.
Remittances reached US$5,060.6 million in the first half, up 4.5%, the BCR reported in July. Inflows for the whole of 2025 were US$9,987.9 million, up 17.7%.
Where the Risks Sit
ECLAC says import-dependent economies face pressure on costs and on household purchasing power. The World Bank names the effect of the Middle East conflict on prices as the main external risk.
At home, Diario El Mundo links El Niño to crop losses and weaker hydropower, and agriculture shrank in the second quarter. UES meteorologist Danilo Ramírez expects El Niño to peak at “very strong” intensity from October to December, citing Columbia University projections.
All three international forecasters expect growth to slow next year, to between 3.9% and 4.1%. That would still be well above the 2% ECLAC expects for the region this year.
What It Means for US Readers
Remittances tie this forecast to the US labour market, because the money comes mainly from the United States. The sources show no change in what Salvadorans in the US send home.
Travellers and expats see construction and tourism strength in the BCR data, with housing financing up 65.1% through June. Investors with Salvadoran exposure should note that all four figures are forecasts, and ECLAC itself expects growth to ease in 2027.
Background is in El Salvador Geopolitics Explained 2026 and the earlier EMFI growth forecast. See also ECLAC’s export forecast and El Salvador’s bitcoin holdings.
What Is Not Known
The full ECLAC tables were not checked line by line, because the commission’s own release could not be opened. The figures come from Diario El Mundo, Diario de Hoy and El Salvador in English reports of it.
One Diario de Hoy headline gives 2.5% for El Salvador, which matches the regional 2027 figure, but its text lists 4.5%. Reports also rank El Salvador differently, depending on whether Panama, Paraguay and Guyana are counted.
Diario El Mundo alone gives Guyana at about 22%, so treat that figure as unconfirmed. The 24% remittance share is EFE’s wording, not ECLAC’s.
What Comes Next
The reports give no date for ECLAC’s next update. The BCR’s next quarterly growth figure will show whether the economy keeps growing above 4.5%.
A higher forecast does not mean higher wages or lower prices for Salvadorans. It also says nothing about the government’s debt or its dealings with the IMF.
Frequently Asked Questions
What did ECLAC forecast for El Salvador?
ECLAC expects El Salvador’s economy to grow 4.5% in 2026 and 4.1% in 2027. In August it forecast 3.9% for 2026.
Who or what is ECLAC?
ECLAC is the UN Economic Commission for Latin America and the Caribbean, called CEPAL in Spanish. It publishes regular growth forecasts for the region.
Do other institutions agree?
The World Bank and the IMF both forecast 4.5% for 2026. El Salvador’s central bank expects 4.5% to 5%.
Why does this matter to Americans?
Remittances, sent mainly from the United States, equal about 24% of El Salvador’s output, EFE reports. The country also uses the US dollar.
What could slow growth?
The World Bank names the Middle East conflict’s effect on prices as the main external risk. At home, Diario El Mundo reports El Niño is hurting crops and hydropower.
Sources: Diario El Mundo, ECLAC raises forecast to 4.5%, 22 October; El Diario de Hoy, 22 October; El Salvador in English, 22 October; Diario El Mundo, World Bank outlook, 6 October; Diario El Mundo, IMF outlook, 13 October; Diario El Mundo, BCR forecast, 31 August; Diario El Mundo, BCR second-quarter GDP, 30 September; Diario El Mundo, UES meteorologist on El Niño, 28 September; Swissinfo (EFE), BCR remittances, July (all accessed 23 October 2026).