El Salvador Country Summary
Sanctions
Lower Concern
FATF AML Deficient List
Lower Concern
Terrorism
Medium Concern
Corruption
Higher Concern
US State ML Assessment
Higher Concern
Criminal Markets (GI Index)
Medium Concern
EU Tax Blacklist
Lower Concern
Offshore Finance Center
Lower Concern
Please note that although the below Summary will give a general outline of the AML risks associated with the jurisdiction, if you are a Regulated entity then you may need to demonstrate that your Jurisdictional AML risk assessment has included a full assessment of the risk elements that have been identified as underpinning overall Country AML risk. To satisfy these requirements, we would recommend that you use our Subscription area.
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Anti Money Laundering
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.
Sanctions
There are no international sanctions currently in force against this country
Criminality
Rating |
0 (bad) - 100 (good) |
|---|---|
| Transparency International Corruption Index | 30 |
| World Bank: Control of Corruption Percentile Rank | 32 |
Corruption remains a significant barrier to investment in El Salvador, with the country ranking 126 out of 180 in Transparency International's 2023 Corruption Perceptions Index. Despite the Bukele administration's claims of reduced corruption and increased public confidence in government institutions, civil society organizations argue that corruption persists, particularly at high levels, and that the government's lack of transparency obscures these issues. Numerous corruption scandals have emerged, involving former presidents and high-ranking officials, while the judicial system struggles with inefficiency and corruption, hindering effective governance and accountability.
Economy
El Salvador's economy benefits from its strategic location, the use of the U.S. dollar, and improved security, which have fostered a more favorable investment climate. The government has prioritized job creation and economic growth, leading to a GDP growth of 3.5% in 2023, with significant contributions from sectors like 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, the use of the U.S. dollar, and significant improvements in security and the business environment. The government has implemented reforms to attract foreign direct investment, including tax incentives and streamlined regulations, leading to a notable increase in foreign direct investment inflows in 2023. However, challenges remain, such as low sovereign credit ratings affecting access to capital markets and ongoing liquidity constraints.
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- Risk Analysis
- Corruption
- Economy
- Sanctions
- Narcotics
- Executive Summaries
- Investment Climates
- FATF Status
- Compliance
- Key Findings