How have remittances from Salvadorans in the United States affected El Salvador’s economy?

Remittances sent by the more than one million Salvadorans living in the United States have become an increasingly vital component of the Salvadoran economy, particularly following the conclusion of the country’s civil war in 1992.1

These funds serve as a major source of income for the nation, accounting for a substantial share of El Salvador’s gross domestic product. Beyond their macroeconomic impact, remittances play a critical role in supporting household economies across the country. While El Salvador has pursued other economic strategies—such as expanding its service industry, increasing agricultural exports, and entering into free-trade agreements like CAFTA-DR—remittances remain a fundamental pillar of financial stability for many families, helping to mitigate the effects of economic challenges such as high oil prices, natural disasters, and persistent income inequality.213