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i. Name of country
EL SALVADOR
ii. Region
Central America, bordering the North Pacific Ocean, between Guatemala and Honduras
iii. Population
6,528,135 (July 2021 est.)
iv. General Introduction
- El Salvador is the smallest South American country, with a GDP of $25 billion and a population of 6.8 million people. Volcanoes, coffee, and surfing are all popular in the country. It is the only country in Central America without a Caribbean Sea coastline. El Salvador uses the US dollar as its official currency, with Bitcoin becoming legal tender on September 27, 2021
- The Office of Trade Policy (Dirección de Política Comercial) is the technical body of the Vice Ministry of Economy responsible for conducting trade negotiations at the regional, bilateral and multilateral level.
- It is also in charge of issues related to the Central American economic integration process and supports the permanent representation of El Salvador before the World Trade Organization (WTO) and the World Intellectual Property Organization (WIPO) in the formulation of proposals.
- El Salvador recently concluded a partial scope agreement (Acuerdo de Alcance Parcial) (AAP) with Bolivia, and association agreements (Acuerdo de Asociación) (ADA) with the EU and the UK.
- The free trade agreement (FTA) between Central America and South Korea was recently ratified in August 2019.
- The Office of Trade Policy also works in co-ordination with other governmental entities in the negotiation of trade agreements, both nationally and regionally.
- El Salvador is a member of the Organisation for Economic Co-operation and Development (OECD) and of the WTO and is also a signatory to many FTAs.
- Politically, a new government was elected in June 2019. The new President, Mr. Nayib Bukele, and his political party GANA have been more open to international trade and globalisation than the traditional right-wing (ARENA) and left-wing (FMLN) political parties.
v. Wifi Speed
From May 2018 to May 2019, broadband internet in El Salvador averaged a download speed of 2.93 Megabits per second (Mbps), slightly up from 2.78 Mbps in the previous year. Meanwhile, as of May 2019, Honduras had an average speed of 2.84 Mbps.
vi. Electrical outlet
In El Salvador the power plugs and sockets are of type A and B. The standard voltage is 115 V and the standard frequency is 60 Hz.
vii. Per Capita GDP
Real GDP per capita
$8,100 note: data are in 2017 dollars (2020 est.)
$8,800 note: data are in 2017 dollars (2019 est.)
$8,600 note: data are in 2017 dollars (2018 est.)
note: data are in 2017 dollars
viii. Climate
tropical; rainy season (May to October); dry season (November to April); tropical on coast; temperate in uplands
ix. Residence-by-Investment
El Salvador is offering Bitcoin/crypto investors immediate permanent residency. This new golden visa scheme was announced by El Salvador’s President after the country made Bitcoin legal tender (the first country to do so) in order to attract wealthy crypto and property investors. Parliament has approved the crypto legislation. It is also one of the few tax-free countries for bitcoin investors.
Investment
Bitcoin investors can gain permanent residency in the country by investing 3 BTC. Those who can invest in fiat currency can apply for a temporary residency permit under the investor permit.
Processing Time
Processing times is between 3-6months
Key Benefits
– One of the few countries in the world with no property tax.
– Bitcoin is a legal tender. No capital gains tax for Bitcoin , since it will be a legal currency.
– Immediate permanent residence for crypto entrepreneurs.
Requirements
– An appropriate visa for foreigners that want to invest in a local company. Foreigners must invest at least USD$1,200,000 to be granted this visa.
– Current passport – must be valid for at least six months from the date of the application.
– A criminal record check from the national law enforcement agency.
– A copy of the individual’s most recent tax declaration.
xi. Natural Resources
hydropower, geothermal power, petroleum, arable land
xii. Ethnic Groups
Mestizo 86.3%, White 12.7%, Amerindian 0.2% (includes Lenca, Kakawira, Nahua-Pipil), Black 0.1%, other 0.6% (2007 est.)
xiii. Languages
Spanish (official), Nawat (among some Amerindians)
xiv. Religion
Roman Catholic 50%, Protestant 36%, other 2%, none 12% (2014 est.)
xv. Median Age
total: 27.7 years
male: 26.2 years
female: 29.3 years (2020 est.)
xvi. Urbanization
urban population: 74.1% of total population (2021)
rate of urbanization: 1.33% annual rate of change (2020-25 est.)
xvii. Physician density
1.57 physicians/1,000 population (2016)
xviii. Government type
presidential republic
xix. Unemployment Rate
7% (2017 est.)
6.9% (2016 est.)
note: data are official rates; but underemployment is high
x. Taxes
Headline Personal Income Tax Rate (highest marginal tax rate)
– 30%
El Salvador taxes its citizens, residents, and non-residents on their income earned in the country and on other Salvadoran-source income.
Headline Corporate Income Tax Rate (excluding dividend taxes)
– 30%
The CIT rate is 30%, and this rate is applicable on the total amount of the company’s revenues. There is a reduced CIT rate of 25% for companies that obtain taxable income equal to or less than USD 150,000 in the fiscal year.
