EXPORT AND INVESTMENT PROMOTION AGENCY OF EL SALVADOR 1 A country of opportunities December 2012.

EXPORT AND INVESTMENT PROMOTION AGENCY OF EL SALVADOR

1

A country of opportunitiesDecember 2012


El Salvador

Ahuachapán

Santa Ana

Chalatenango

Sonsonate

SanVicent

e

Cabañas

La Paz

LaLiberta

d

SanSalvado

r

Usulután

San Miguel

Morazán

LaUnión

Cuscatlán

Gulf of Fonseca islands

Capital San Salvador

Official Language Spanish

Area 21,041 Km2 / 8,124 sq mi

Population 6.2 million (2011)

GDP Nominal (2011) 23,054 million USD (2011)

Currency $USD

Time Zone UTC -6


• Solid political & economic environment

• International view of El Salvador

• Commercial openness & strategic location

• Foreign direct investment in El Salvador

El Salvador


4

Political StabilityMore than 25 years of free and democratic elections

• Balance of power in congress

LegislativeAssembly

• Alternating governancePD

C

AREN

A

FMLN

Presidential election: % of votes for Presidential Candidate of winning partySource: Supreme Electoral Court of El Salvador (TSE ).

President for 5 year term with no possible consecutive reelection

1 chamber with 84 seats for 3 year terms

March 2012 Congress election results, seats won by each party


Central American Market

Country

EL SALVADOR GUATEMALA HONDURAS NICARAGUA COSTA RICA PANAMA

Central America

Capital San Salvador Guatemala City Tegucigalpa Managua San Jose Panama City

Official Language Spanish Spanish Spanish Spanish Spanish Spanish

Area (‘000 Km2) 21.0 108.9 112.1 130.4 51.1 75.4 498.9

Population (‘000,000) 6.2 14.7 8.0 5.8 4.6 3.5 42.8

GDP PPP (Bn US$) 2011 44.6 74.8 35.7 18.9 55 50.6 279.6

GDP per capita PPP (US$) 7,550 5,079 4,444 3,206 11,923 14,096 6,533

Average Inflation rate 2010-2011 3.6% 5.8% 6.0% 8.6% 5.3% 5.6%

Currency Dollar USD

Quetzal GTQ

Lempira HNL

Cordoba NIO

Colon SJC

Dollar USD

Time Zone UTC -6 UTC -6 UTC -6 UTC -6 UTC -6 UTC -5

Source: Multi –Purpose Household Survey, Central Reserve Banks, and IMF.

70% of the population and commerce concentrates in ES, GT, and HN.


Fringe benefits represent 27.61% of nominal wage

* Effective since May ** 2011 Provision in case of termination of contract*** Applies to companies with more than 10 employees

Source: Ministry of Labor El Salvador

Sector Monthly Minimum Wage* Daily Wage

Agriculture $ 105.00 $ 3.50

Maquila $ 187.50 $ 6.25

Industry $ 219.30 $ 7.31

Commerce & Services $ 224.10 $ 7.47

NominalWage100%

Fringe Benefits27.61%


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M 23.4

F 26.2

EAP: 2,641,133

years

Young Population

Average Age(Estimates)

Source: Multi-Purpose Household Survey 2011, CIA World Factbook


El Salvador






International view of El Salvador

IndexEl Salvador Guatemala Honduras Nicaragua Costa Rica Panama

Human Development Index

(2011)105 131 121 129 69 58

Index of Economic Freedom (2012)

41 82 93 101 44 55

Ease of Doing Business (2013) 113 93 125 119 110 61

Freedom in the World(2012)

Free Partially Free

Partially Free

Partially Free Free Free

Global Competitiveness

Index (2012 – 2013)Infrastructure

RoadsAirportsEnergy

Mobile TelephonesTaxes

101665242703756

83679158672379

90979271

1067992

1081067590

100108130

5795

131604294

119

4044496

432

96


El Salvador






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Legal Framework

Investment Law

International Services Law

Tourism Law

Free Zones Law

• Equal treatment to national & international investors• Liberty to transfer funds and profits abroad• Access to local financing

• Incentives to strategic sectors (contact centers, BPO’s, maintenance and repair of airplanes, logistics, etc.)

• Total permanent tax exemptions (income and municipal taxes) and import duties.

• Incentives to industrial activities• Total permanent taxes exemption (income and municipal

taxes) and import duties.

• Incentives to industrial activities• Total permanent taxes exemption (income and municipal

taxes) and import duties.

Renewable Energy Incentives Law

• Customs duties exemption on imports of machinery, equipment and materials

• Income tax exemption for a period of 5 to 10 years• Total tax exemption on revenues from the sale of Certified Emission

Reductions


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Commercial Openness Access to a potential market of 1,200 million people


Main Trade Partners

Main Export Products

Source: Central Reserve Bank

Main Trade Partners and Export Products

El Salvador Exports 2011USD 5,308.8 million


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Main airlines serving El Salvador

Strategic Location

Main Freight Companies

Air Cargo•DHL•UPS•Arrow

Regular charter flights

Close to key markets•Closeness to the vital maritime routes.•A natural bi-oceanic logistics corridor.•Container terminal ready for post panamax ships.•A dominant airport certified A1 by the FAA linking important cities.

(Montreal, Toronto)


Strategic Location


El Salvador






Foreign Direct InvestmentStock 2011 USD 8,141 million (35.3 % of GDP)


Specialized Textiles Aeronautics Electronics Medical Devices

Offshore Business Services Health Services

Tourism Agro-industry Logistics and Infrastructure Footwear

Investment Opportunities


El Salvador offers an aircraft

maintenance, repair and overhaul

(MRO) industry for commercial aircraft,

which has successfully placed the

country on the global aviation map.

The successful operations of Aeroman,

a member of Canadian MRO group

Aveos, are widely recognized within the

emerging Latin American aeronautical

clusters.

AeronauticsCompliance with international certifications ensuring the highest quality required in aircraft maintenance services.


El Salvador: Quality in aircraft maintenance services

Investment Opportunities in Aeronautics:• Commercial aircraft maintenance service operations.

• R44 helicopter maintenance operations.

• Light Sports Aircraft (LSA) airframe part manufacturing.

• Painting and maintenance of commercial aircraft interiors.

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For investors in agro industry and entrepreneurs who seek a platform to produce and export, El Salvador offers

attractive opportunities in the following sectors:

•Fruit Farming

•Aquaculture

•Ornamental plant farming

•Food & Beverages

These sectors are highly favored by good weather and easy access to

regional and international markets.

AgroindustryClimate, tax incentives and a platform

connected to additional markets.


El Salvador: A production and export platform

Investment Opportunities in Agro Industry:• Aquaculture Sector: Development of the production chain through the supply of young fingerlings, feed and other inputs to

attain productivity and quality of aqua cultured products.

• Fruit Farming Sector: Development of supporting industries for the provision of supplies, equipment, quality vegetative materials and processing technology for the expansion of crops of avocado, Persian lime, coconut and organic products.

• Processed Foods Sector: Opportunities in the development of complementary industries in a sector in continuous growth in areas such as: packaging, process technology, machinery and equipment.


International medical device

manufacturing companies will

find in El Salvador a strategic

partner to be used as a

platform for export to markets

in North America, Central

America and the Caribbean.

Medical DevicesRapid access to markets


El Salvador: A strategic partner in medical devices

Investment Opportunities in Medical Devices:• Disposable laboratory and diagnostic equipment.

• Hospital linen and disposable clothing.

• Hospital furniture.

• Orthopedic products.

• Packing and packaging of disposable medical devices.


El Salvador offers a successful platform for electronic component manufacturing, with

over 30 years of proven credibility. The country has experience in the manufacture of

ceramic and tantalum capacitors in compliance with required international

standards. This has enabled the country to acquire and

implement state-of-the-art technology and know-how.

The high quality, efficiency and productivity of

operations in El Salvador have ensured the transfer of manufacturing plants from

England, the Czech Republic, Mexico, China and the U.S., achieving continued expansion

in all processes.

ElectronicsHigh productivity and quality manufacturing at competitive costs.


El Salvador: A platform for electronic components manufacturing

Investment Opportunities in Electronics:• Electronic component manufacturing and production.

• Electronic equipment and parts assembly.

• Cell phone electronic component repair.


For offshore business service firms seeking to enter markets in the U.S. and Spanish-

speaking countries, El Salvador is a strategic partner for providing quality multi-region

business services.

Our dynamic business environment, strategic location for near-shoring, time-

zone complementarity and the outstanding performance of our bilingual human

resources (English/Spanish), makes us a strategic platform for companies offering

global services.

The modern and advanced local telecommunications infrastructure ensures

the delivery of quality services and cost-effective location for this industry.

Offshore Business ServicesCost effective near-shore location, based on a state of the art

telecommunications platform which guarantees your global offer.


El Salvador: Complementary strategic partner for multi-region operations

Investment Opportunities in Offshore Business Services:• Voice Business Process Outsourcing (Call Centers)

• Non-voice Business Processes Outsourcing (BPOs)

• Shared Service Centers (KPOs)


El Salvador offers the opportunity to

invest in health establishments

catering to patients living in the U.S.

and Canada, taking advantage of the

geographical proximity to those

markets, the low costs of health

professionals and the fast connections

between medical facilities and

enviable landscape sites..

Health ServicesGeographical proximity to the main countries of origin of

medical tourism, offering quality services at low costs


El Salvador: Strategic location and excellent connectivity between touristic sites

Investment Opportunities in Health Services:• Hospitals

• Specialized clinics

• Rehabilitation centers

• Medical spas

• Hospitals Resorts for treatment of chronic diseases.


El Salvador offers attractive investment opportunities to

specialized textile and clothing companies wishing to enter the

regional Central and North American markets based on the favorable tariff

conditions of FTAs with the U.S. (CAFTA) and the European Union.

El Salvador offers a vertically

integrated industry, which promotes a competitive high-fashion, high-

turnover garment manufacturing industry.

Specialized Textiles and ApparelVertically integrated industry with easy access to markets


El Salvador: Specialized textile and apparel sector environment

Investment Opportunities in Specialized Textiles and Apparel:• Manufacture of yarn and fabrics.

• Manufacture of knitted garments with accessories and embellishments (embroidery, screen printing, heat transfers, etc.).

• Manufacture of garments included in the “Single Transformation” category: bras, girl dresses, boxer shorts, sleepwear and luggage.


El Salvador offers attractive tourism projects

in various stages of development that take

advantage of a wide array of attractions

located close to each other (surf spots,

beaches, mountains, lakes, volcanoes).

The country has a historical past inherited

from the Maya, a pleasant climate all year

round, competitive pricing of land, low

construction costs and proximity to

important markets of origin of international

tourism.

TourismSurf, fishing, adventure tourism and the

Maya world ... all in one place.


El Salvador: Variety of close-by touristic attractions

Investment Opportunities in Tourism:• Mixed-use developments .

• Hotels: Urban, Resort, Boutique, Bed & Breakfast, Eco-lodge, Hostels.

• Vacation homes.

• Properties with tourism potential

• Marinas


For companies producing consumer

goods seeking to sell to larger markets,

El Salvador, the ‘logistics hub of Central

America,’ provides air and seaport zones

with tax incentives for manufacturing,

logistics and distribution, becoming a

gateway to U.S., Asian and European

markets.

El Salvador has the infrastructure,

geographical proximity and free trade

agreements to ensure easy and timely

access to large markets.

LogisticsEasy and timely access to large markets.


El Salvador: Strategically located and available infrastructure

Investment Opportunities in Logistics:• Logistics activity zones in the proximity of seaports.

• Airport logistics center

• Distribution centers

Puerto de Acajutla, located in Sonsonate Puerto La Unión, located in La Unión


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For companies producing footwear

seeking to sell to larger markets, El

Salvador, the ‘logistics hub of Central

America,’ provides air and seaport zones

with tax incentives for manufacturing,

logistics and distribution, becoming a

gateway to U.S., Asian and European

markets.

El Salvador has the infrastructure,

geographical proximity and free trade

agreements to ensure easy and timely

access to large markets.

LogisticsEasy and timely access to large markets.

FootwearA platform to export to large markets.


Began in the city of Santa Ana with local artisans.

El Salvador:

Footwear Industry Currently: Big companies as ADOC, DURAMAS, CARICIA, GARBAL,

exports to United States, Central America and The Caribbean, Europe and Asia.

16 small enterprises, primarily produce to the Salvadoran market.

390 handicraft workshops producing for the small and large companies located in San Salvador and Santa Ana.

ASPC: Salvadoran Association of Footwear Producers with 125 companies of La Libertad, La Paz, La Unión, San Vicente and San Salvador.

2011 Exports: US $42 million (12% annual growth

over the last 6 years -2005/2011-). El Salvador has the 26th position as a

footwear supplier of the United States. El Salvador exports to the US market grew 28% in 2011. Source: USITC

The Imports grew by 23% compared to 2010 (US $106 million) and 9% annually in the last 6 years.


Services provided by PROESA

Information on the business climate, economic factors, set-up and operational costs, regulations, availability of human capital and any other information required in the early stages of the evaluation process.

Personalized attention to specific enquiries.

Informationand Advisory

Facilitates the evaluation process of the country by offering:

Advises international companies on investment opportunities in El Salvador by providing:

Information on investment opportunities in strategic industries, as well as incentives and investment advantages of those industries.

Statistics and customized industry information.

Works to identify contacts and locations for international investors through: Finding of specific locations and sites for each project. Facilitating contacts of potential partners, government institutions and

providers of goods and services including legal, financial, customs, real estate, among others.

Organization and coordination of customized site visits to El Salvador.

Assists potential and established investors with: Integral support on procedures required to establish or expand business

operations in the country.

Establishment and Expansion

Assistance

Business Opportunities


EXPORT AND INVESTMENT PROMOTION AGENCY OF EL SALVADORTEL +503 2246 6400

Edificio D'Cora Primer Nivel, Urb. Santa Elena, Antiguo Cuscatlán, La Libertad, El Salvador, C.A.

www.proesa.gob.sv

EXPORT AND INVESTMENT PROMOTION AGENCY OF EL SALVADOR 1 A country of opportunities December 2012.

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Transcript of EXPORT AND INVESTMENT PROMOTION AGENCY OF EL SALVADOR 1 A country of opportunities December 2012.