Saturday, August 13, 2005

El Salvador wants investments in the homeland

The Washington Post carries a story about efforts by El Salvador to lure investment from Salvadorans who have emigrated to the US. Although significant sums (totaling a sixth of El Salvador's economy) come from emigrants sending money back to families, little money comes back for investment:

Only about 10 percent of the more than 1 million Salvadorans living abroad have any kind of business investment in their native land, according to a study released last month by Georgetown University's Institute for the Study of International Migration. The report, led by political scientist Manuel Orozco, also found that 16 percent of Salvadoran immigrants have bank accounts in El Salvador, and 10 percent are still paying off some form of debt in their native country.

In comparison, nearly 70 percent of Salvadoran immigrants regularly send money to family members in El Salvador. Last year, Salvadorans living in the United States sent $2.5 billion to their families, according to the Inter-American Development Bank. The money that they send, known as remittances, is mostly used to buy food, clothes and other consumer goods.

The government and business groups here are also encouraging Salvadorans abroad to invest in property and businesses. El Salvador's Ministry of Foreign Affairs, which tries to maintain ties with the country's emigrants, is pushing for a government program that will give incentives to Salvadorans living elsewhere to invest in job-creating ventures.

Along with tourism projects, the government is promoting investment in traditional agriculture, call centers and auto-parts manufacturing.

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