El Salvador: Rural Development Study (World Bank Country by World Bank

By World Bank

Even if El Salvador has recorded remarkable total financial development within the Nineties, in this interval, agricultural development has lagged significantly less than the remainder of the economic climate, which increases issues concerning the long-run potential of the sphere to elevate earning and employment in rural parts and give a contribution to total progress. the most ambitions of this zone overview are twofold: to boost a technique to revitalize the rural area and discover its complete power for effective and sustainable progress by way of improving competitiveness; and to provide the most findings of the research of rural poverty and enhance its implications for the layout of a technique for poverty relief.

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Extra resources for El Salvador: Rural Development Study (World Bank Country Study)

Sample text

The report suggests re-examining the trade regime in order to: make the export drawback applicable to all export products. Today it favors non-traditional exports and there is little justification for such discriminatory treatment; make the value added tax (VAT) applicable to all products, to eliminate discrimination against agricultural activities which have to pay VAT on inputs but are exempted at the output level; reduce the level of protection to chicken meat and/or increase protection to white maize to align it with the tariff on other agricultural products (1520%); deal with an exceptional upsurge in imports and/or reduction in import prices, El Salvador can make use of a safeguard scheme in compliance with the World Trade Organization.

However, based on the survey data collected for this study, the analysis indicates that the extent and severity of land degradation problems in El Salvador are substantially lower than is commonly perceived. Degradation affects about 31% of fields farmed by households. The data available are insufficient to measure the severity of degradation, but it is significant that most farmers do not expect severe problems. The analysis concludes that there is no need for new broad, national-level policies.

0Source: Table 27, Annex 1. Remittances. Migration as a result of the conflict has been substantial. Strong family bonds have produced a large flow of family remittances, which expanded rapidly from 1990 to 1995, and which now exceed total exports (excluding maquila). Remittances have increased the supply of foreign exchange which has led to a substantial appreciation of the real exchange rate, especially since 1991, negatively affecting agricultural production which is essentially tradable. Remittances have benefited the rural sector by increasing the purchasing power of rural households, encouraged the expansion of trade and services in urban and rural areas, (especially in the Orient where the conflict was more serious and migration higher).

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