Entries for 'El Salvador'
August 9, 2022
El Salvador’s funding gap through the January bond payment, …
could be 4% of GDP in the mild scenario we presented last week.
Already falling rollo...
October 26, 2021
El Salvador’s risk premium has skyrocketed amid financing shortfalls and governance issues. A vigorous growth rebound has aided the fiscal balance, but the 2022 proposed budget projects optimistically large gains in tax administration. Financing options are narrowing as IMF negotiations drag on.
October 8, 2021
Activity has rebounded faster than expected, spurred by exports and remittances.
Vaccination rollout has accelerated in several countries, aiding th...
August 18, 2021
Partial fiscal consolidation is underway following extraordinarily large deficits in 2020. Revenue has increased above pre-pandemic levels amid the ongoing growth recovery, but withdrawal of fiscal stimulus has been uneven. Fiscal pressure remains high given the debt buildup and deep social needs.
April 14, 2021
Frontier LatAm countries have bounced back following a sharp decline in 2020, but disparities in the recovery remain. Guatemala has already surpassed pre-COVID-19 GDP levels, while Panama continues to face challenges. Fiscal accounts have been severely affected, worsening public financing woes.
November 2, 2020
We project a real GDP contraction of 7.5% in 2020 and a modest rebound in 2021. Tourism remains depressed, but remittances have surpassed pre-COVID-19 levels. SLV, JAM, and PAN are set to endure the steepest recessions, while GTM should contract the least due to its stable macroeconomic framework.
October 8, 2020
The BoP correction has been remarkable amid activity collapse and exchange rate flexibility.
Current account adjustment helped protect reserves desp...
August 19, 2020
COVID-19 has exacerbated El Salvador’s external financing needs. Pressure has intensified amid a widening fiscal deficit, and financing options are narrow. With limited flexibility to unwind stimulus after COVID-19, an IMF program would help ease medium-term financing concerns.
July 1, 2020
Exchange rate flexibility has eased the adjustment to COVID-19 in most large countries. However, “fear of floating” is still high across Central America and the Caribbean. While local market financing is increasing, countries have largely had to borrow in hard currency to help withstand the shock.
May 7, 2020
COVID-19 has increased external funding challenges despite moderate borrowing needs. Notwithstanding oil price relief, collapsing remittances and tourism will weigh on current account receipts. While some countries have tapped global debt markets, uncertainty over financing sources remains.
April 13, 2020
COVID-19 has affected Latin America through multiple channels. Pre-existing challenges and increased exposure put the region in a difficult position. We project a deep recession this year amid a sudden stop in capital flows and limited policy space.
November 7, 2019
Current account deficits in Frontier LatAm are wide by EM standards, largely due to energy trade imbalances, but lower oil prices since 2014 have helped ease financing gaps. Despite global headwinds and regional tensions, we project CA deficits to stay contained in 2019-20, broadly financed by FDI.
May 8, 2019
Current account deficits in Frontier LatAm remain wide and are largely dependent on remittances and oil prices. While high FDI helps cover external financing needs, debt buildups have been significant in some countries, increasing external vulnerability amid limited buffers.
February 7, 2019
We project solid growth and contained inflation this year and next. Main risks to the outlook are linked to external conditions as domestic policies have generally improved. While progress has been made to address longstanding challenges, major structural weaknesses remain.