El Salvador

Trade and Investment play an important role in EI salvador’s economy reflecting in part the openness of itstrade and investment regime. The trade policy regime of EI salvador has been further liberalized since EI salvador’s previous Trade Policy Review in 2003. Progress has been made in modernizing customs elimingating unnecessary licensing requirements enhancing the transparency of technical regulations and SPS measures and strengthening the institutional framework on competition policy and government procurement. As part of its liberalization efforts EI Salvador has entered as well into three new preferential trade agreements(with Chinese Taipei Panama and the United States) and continued to assign high priority to deepening central american intergration. EI Salvador has also maintained its long-standing strategy of granting exporters refunds as well as fiscal privileges through free-trade zones (FTZs) which result in subsidies and tex breaks that distort economic incentives.