FATF Status​

El Salvador is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations​

The latest Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in El Salvador was undertaken in 2024. According to the follow-up Evaluation, El Salvador was deemed Compliant for 6 and Largely Compliant for 25 of the FATF 40 Recommendations. It was deemed Highly effective for 0 and Substantially Effective 1 of the Effectiveness ratings.

Corruption remains a significant challenge for investment in El Salvador, as evidenced by its low ranking in Transparency International's 2023 Corruption Perceptions Index. While the Bukele administration has reportedly improved public confidence in government institutions and reduced the prevalence of bribery, civil society organizations argue that corruption persists, particularly at high levels of government, and that transparency has diminished. Numerous corruption scandals have emerged, involving former presidents and officials, highlighting the ongoing issues of accountability and the effectiveness of anti-corruption measures.

El Salvador's economy benefits from its strategic location, the use of the U.S. dollar, and improved security, which have bolstered consumer confidence and attracted foreign direct investment (FDI), reaching $759.7 million in 2023. The government has prioritized job creation and economic growth through regulatory reforms and infrastructure projects, leading to a GDP growth of 3.5% in 2023, with significant contributions from sectors such as construction and tourism. However, challenges remain, including liquidity constraints and low sovereign credit ratings, which hinder access to capital markets.

El Salvador's investment climate is bolstered by its strategic location, use of the U.S. dollar, and improved security conditions, which have led to increased consumer confidence and economic growth. The government has implemented reforms to attract foreign direct investment, including tax incentives and streamlined regulations, resulting in a significant rise in foreign direct investment inflows in 2023. However, challenges remain, such as ongoing liquidity issues and low sovereign credit ratings, which hinder access to capital markets.