El Salvador: leading the revitalization of Central America.

Located in the heart of Central America, El Salvador is one of the strongest economies in the Western Hemisphere, and a leader in facilitating regional trade integration.

"We are commited to the regional process of integration in Central America and beyond," says Miguel E. Lacayo, Minister of Economy. "Our vision is to continue building regional alliances based on common interests and shared values, creating new opportunities in El Salvador, and making Central America even more attractive for investment."

El Salvador has benefited from a decade of economic reforms sustained by three democratically elected governments. In the 1990s, the nation has streamlined and liberalized its economy through privatization, deregulation, and the implementation of market-oriented economic reforms. In addition, El Salvador has modernized its customs service and created incentives to import capital goods and intermediate products.

The introduction of the U.S. dollar as legal tender in 2001 was an extremely significant step toward long-term financial stability, as well as facilitating the ongoing integration of the Central American economies--a goal supported by the nation's modern and dynamic banking system.

As a result of these reforms and initiatives, El Salvador today enjoys fiscal stability, low inflation, strong international reserves and a legal environment that supports private investment. "Our nation's macroeconomic stability is one of our principal strengths," says Lacayo. "We are one of three countries in Latin America with an investment-grade credit rating, and we rank #17 on the Index of Economic Freedom by the Heritage Foundation."

El Salvador's pro-business government has adopted a regulatory framework that allows foreign investors and the private sector to lead the economic development of the nation. El Salvador also has an abundant bilingual educated labor pool, and multinationals with operations in El Salvador enjoy the benefits of reduced learning curves, high levels of productivity, and low turnover rates.

With its proximity to major Latin American and U.S. markets, El Salvador has attracted more than $500 million in direct foreign investment in recent years from the United States, Canada, Japan, Germany, Korea. Taiwan and Mexico. Key growth sectors include agribusiness, call centers, electronics, manufacturing and assembly operations and tourism.

With its streamlined customs system, modern telecommunications infrastructure and convenient air and sea transportation facilities, El Salvador offers a strategic location for businesses seeking access to the region. El Salvador has the most modern international airport in Central America, operating more than 20 flights daily to major U.S. cities, and its ports allow industrial goods to be transported to the United States in five days or less.

In the last two years, El Salvador has made significant progress toward the hemispheric goal of a Free Trade Area of the Americas (FTAA), by signing free trade agreements with Mexico, Chile, Dominican Republic and Panama. El Salvador is in the process of negotiating a similar accord with Canada and with the United States. "An integrated trade area with Mexico, Canada, the United States and Central America offers multiple advantages to multinational companies," says Lacayo, "including economies of scale for regional projects, and a direct access to marketplace of more than 400 million people."