WT/TPR/S/226/Rev.1 Trade Policy Review 
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II. TRADE AND INVESTMENT REGIME 
(1) OVERVIEW  
1. The principal objectives of the trade policy of El Salvador are to strengthen the trade and 
investment flows between El Salvador and the rest of  the world, and to further the process of Central 
American integration.  El Salvador has been a Member of the WTO since May 1995 and takes an 
active part in negotiations and in the regular work of  the Organization.  It has made a large number of 
notifications, but at October 2009 some remained pending, including those concerning State-trading enterprises, import licensing and customs valuation.  El Salvador participated in the negotiations on 
basic telecommunications and on financial servic es held within the GATS framework and accepted 
the Fourth and Fifth Protocols to the GATS.  El Salvador did not use the WTO's dispute settlement 
mechanism during the period under review. 
2. El Salvador is a member of the Central American Common Market (CACM), which seeks to 
strengthen Central American integration, with pa rticular emphasis on consolidation of the Customs 
Union.  In addition to its membership of the CA CM, El Salvador has free trade agreements with 
Chile, the United States of America (CAFTA-DR), Mexico, Panama, Chinese Taipei and the 
Dominican Republic.  Together with the other members of the CACM, El Salvador is negotiating 
association agreements with the European Union and free trade agreements with Canada and the 
Caribbean Community (CARICOM).  The CACM a nd the CAFTA-DR are of especial importance to 
El Salvador inasmuch as 86 per cent of its exports  and 52 per cent of its imports come under one of 
these two schemes. 
3. During the period under review, there were no major changes to El Salvador's foreign 
investment regime, which focuses on attracting inv estment.  The Investment Law guarantees freedom 
to invest and national treatment for foreign invest ors, except in those areas where other laws impose 
restrictions.  Other restrictions on foreign invest ment affect industry and the supply of "small-scale" 
services, which are the prerogative of Salvadoran c itizens by birth or nationals of other Central 
American countries, and the ownership of rural real  estate, which may not be bought by foreigners 
from countries that do not give Salvadoran citizens equal rights. 
(2) T
RADE AND INVESTMENT POLICY FRAMEWORK  
(i) General legal and institutional framework 
4. The Constitution of the Republic of El Salvador  has been in force since 20 December 1983 
with some amendments.1  The Constitution provides for the separation of powers between the 
executive, legislative, and judici al bodies, and for the operational independence of each of those 
branches.  The executive branch is headed by a Pr esident elected by popular vote every five years, 
who is assisted by a Vice-President and the Council of  Ministers.  The main functions of the executive 
branch include enforcing the Constitution and direc ting foreign policy and it is empowered to enter 
into international treaties and c onventions, submit them to the Legislative Assembly for ratification 
and monitor compliance therewith.  The President  has exclusive power to appoint and dismiss 
Ministers of State;  and he or she chairs the Council of Ministers.  The most recent Presidential election was held on 15 March 2009 and the new administration took office in June 2009. 
                                                     
 
1 Since its last Review, El Salvador has introduced constitutional reforms relating to the Higher 
Council for Public Health (2003), the right to strike , unionization of government employees and professional 
associations (2006), an d free education (2008). El Salvador WT/TPR/S/226/Rev.1 
 Page 13 
 
 
5. The legislative branch consists of a Legisla tive Assembly of 84 deputies who are elected by 
suffrage every three years with the right to re-elec tion.  The main functions of the Assembly are, 
inter alia , to make laws and approve the national budget.  International tr eaties must be ratified by the 
Assembly, which may approve them or reject them ;  it may also enter reservations.  The treaties 
become laws of the Republic and in the event of  a conflict of laws, have supremacy over secondary 
laws in the domestic legal order.  Other bodies in addition to the deputies may initiate legislation, 
namely the President of the Republic through his ministers;  the Supreme Court of Justice in areas relating to the judiciary, the functions of notaries and lawyers, and the jurisdiction and competence of 
the courts;  and the municipal councils  with regard to municipal taxes. 
6. The judicial branch consists of the Supreme C ourt of Justice, the courts of second instance 
and the other courts established unde r secondary legislation.  The Supreme Court of Justice consists 
of 15 judges and four divisions, namely the Constitutional Division, the Administrative Litigation Division, the Criminal Division, and the Civil Division. 
(ii) Trade policy formulation and objectives 
7. The Ministry of the Economy is responsible fo r the formulation of trade policy, which is 
implemented through the Trade Policy Directorate an d the Directorate for the Administration of Trade 
Agreements (DATCO) attached to the Vice-Ministry of the Economy.  The Trade Policy Directorate's 
overall objective is to define and promote strategies that help further the process of Central American 
economic integration and st rengthen the trade and investment flow s between El Salvador and the rest 
of the world.
2  Accordingly, the Trade Policy Directorate is responsible for harmonizing trade policy 
with the Government's other economic policies and development plans, and for coordinating, 
conducting and following up bilateral,  regional and multilateral trade negotiations.  The objective of 
DATCO is to fulfil the administrative obligati ons resulting from the trade agreements signed by 
El Salvador and to ensure that those oblig ations are fulfilled by its trading partners.3  DATCO is also 
responsible for monitoring tariff concessions, mark et access, the application of agricultural 
preferences and quotas, as well as applying the trad e defence mechanisms contained in the legal 
instruments relating to international trade. 
8. In addition to the government departments referred  to above, the Ministry of Foreign Affairs, 
the Ministry of Public Health and Social Welfare,  the Ministry of Agriculture and Livestock, the 
Ministry of Finance and the National Science and Technology Council (CONACYT), inter alia , are 
also involved in the trade policy formulation process. 
9. El Salvador has had a Permanent Mission to the WTO in Geneva since January 2003, led by a 
Permanent Representative with the rank of Ambassa dor.  The Permanent Mission is part of the 
Ministry of the Economy. 
10. Strengthening trade and investment flows between  El Salvador and the rest of the world and 
furthering the process of Central American integr ation remain the key objectives of El Salvador's 
trade policy, and were endorsed as such in the In stitutional Strategy Plan 2004-2009.  According to 
the Plan, one of the major targets of Salvadoran trade policy was to consolidate openness to trade 
through the negotiation and signature of new trad e agreements providing for preferential access to 
strategic markets and for stronger Central American in tegration.  Another part of the strategy was to 
foster El Salvador's participation in the WTO in or der to help the country achieve full integration in 
the international economic and trade order.  The aim of the Strategy Plan was to establish and 
                                                      
2 Online information from the Trade Policy Directorate.  Viewed at:  
http://www.minec.gob.sv/policom/default.asp?id=2&mnu=2. 
3 Online information from DATCO.  View ed at:  http://www.minec.gob.sv/datco/. WT/TPR/S/226/Rev.1 Trade Policy Review 
Page 14 
 
 
implement various mechanisms and instruments to  support the private sector and thus increase 
national productivity and competitiveness.4 
11. The objectives laid down in the new administ ration's Government Plan for the period 
2009-2014 include narrowing the foreign trade ga p through support for investment in export 
production by the maquila industry of traditional an d non-traditional goods with greater value added.  
The Plan also aims to diversify destination mark ets for Salvadoran exports ;  to improve domestic 
production capacity by making it more competitive compar ed to imports, so as to reduce the country's 
vulnerability to changes in the world economic situa tion;  and to promote foreign trade in order to 
create jobs that will help increase productivity and future capacity. 
12. The Salvadoran Government has a mechanism for consulting the private sector concerning 
trade policy formulation, in particular consultati ons held through the Trade Negotiations Advisory 
Office ( Oficina de Apoyo del Sector Productiv o para las Negociaciones Comerciales , ODASP), in 
which all the business sectors are represented.  Th e private bodies involved include the National 
Private Business Association (ANEP), the Salvador an Association of Industrialists (ASI), the 
Chamber of Commerce and Industry of El Salva dor, and the Salvadoran Exporters Corporation 
(COEXPORT).  There are other organizations besides ODASP which sometimes advise the 
Government on economic policy matters, such as the Salvadoran Foundation for Economic and Social 
Development (FUSADES) and the National Fou ndation for Economic Development (FUNDE). 
13. During the period under review, El Salvador  implemented the Public Participation 
Programme aimed at encouraging ci vil society to become involved in  foreign trade matters such as 
free trade agreements and Central American Integrat ion.  Thanks to this Programme, the public can 
submit opinions, comments or documents relating to the ongoing negotiations and obtain information 
on the benefits, challenges and opportunities offered by  the agreements which El Salvador has already 
signed. 
(3) FOREIGN INVESTMENT REGIME  
14. El Salvador has an investment regime which seeks to attract foreign investment for the benefit 
of the country's economic and social developmen t.  The Constitution guarantees economic freedom to 
the extent that it does not conflict with the public interest;  it provides that the State should promote and safeguard private initiative in such a way as to foster growth in national wealth and make the 
benefits of such wealth available to the greatest pos sible number of the country's inhabitants;  and it 
recognizes and guarantees the right to private property. 
15. Article 106 of the Constitution defines the legal framework governing expropriation and 
establishes that private property cannot be expropri ated except for legally su bstantiated reasons of 
public need or social interest and subject to compensation.  There have been no instances of 
expropriation since 2003. 
16. The Investment Law (Decree No. 732 of 14 Oct ober 1999) governs El Salvador's investment 
regime, including foreign investment.  The Investment Law guarantees freedom to invest and national 
treatment for foreign investors - except in those ar eas where other laws impose restrictions - as well as 
the protection and security of property.  It also guarantees the free transfer of funds abroad.  It expressly prohibits the application against foreign i nvestors of unjustified or discriminatory measures 
which may hinder the establishment, administration, use, usufruct, extension, sale or liquidation of their investments. 
                                                     
 
4 Ministry of the Economy, Vice-Ministry of the Economy and Vice-Ministry of Trade and Industry 
(2004). El Salvador WT/TPR/S/226/Rev.1 
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17. The Investment Law sets out the various restri ctions on foreign investment:  (a) trade, 
industry and the provision of "small-scale" services ar e the prerogative of Salvadoran citizens by birth 
and of nationals of other Central American countries;  (b) the subsoil belongs to the State, which may, 
however, grant concessions for its exploitation;  a nd (c) rural real estate may not be acquired by 
foreigners from countries that do not give Salvadoran  citizens equal rights, except in the case of land 
for industrial establishments.  The Investment Law fu rther stipulates that the State is empowered to 
regulate and supervise public services provided by  private companies and to approve the rates 
charged.  The Law specifies that foreign investor s have access to domestic financing provided by 
financial institutions, pursuant to the terms laid down by such institutions. 
18. To benefit under the Investment Law, any foreig n investor or Salvadoran company in which a 
foreign investor has invested must apply, either in  person or through a legal representative or agent, to 
the Ministry of the Economy for the investment to be entered in the Foreign Capital Register of the 
National Investment Office (ONI).  The ONI ope rates as a single window facility where Salvadoran 
or foreign investors can carry out all the formalities required to make their investments.  Registration 
is not discretionary and no review is required for the approval or acceptance of foreign investments in 
El Salvador.  The Investment Law stipulates that the ONI may not make entry in the register of 
foreign investments contingent on the fulfilment of performance requirements.5  The principal 
purpose of registration is to establish that the investment comes from abroad. 
19. The Agency for the Promotion of Investment in El Salvador (PROESA) was established in 
2000 and is the State body responsible for promoting foreign investment in El Salvador.  PROESA's 
overriding objective is to generate employment and stimulate technology transfer by attracting and 
retaining foreign investment.  PROESA's work also  involves promoting El Salvador's image abroad, 
identifying potential investors and assisting them in the search for business opportunities in 
El Salvador, by providing them with information, contacts, and the services they need to guide them 
towards a decision to invest in the country.6  PROESA works in cooperation with the ONI. 
20. The international agreements signed by El Salvador also contain clauses which give 
guarantees and protection for foreign investments.  At May 2009 El Salvador  had signed 24 bilateral 
agreements on the reciprocal promotion and protec tion of investments (BITs), most of which were 
already in force (Table II.1).  Three of the BITs in question entered into force during the period under 
review.  At October 2009, El Salv ador had signed a single double taxati on agreement, with Spain, but 
it was not yet in effect. 
21. The free trade agreements (FTAs) negotiated by  the CACM countries with Chile (Chapter X) 
and the Dominican Republic (Chapter IX) include sp ecific provisions with regard to investment, as 
does the FTA between Mexico and El Salvador, Guat emala and Honduras (Chapter 14).  There is also 
a chapter on the subject in the FTAs with Chines e Taipei (Chapter 10), Colombia (Chapter 12), 
CAFTA-DR (Chapter 10) and Panama  (Chapter 10).  Generally the provisions of the BITs and FTAs 
guarantee MFN treatment to foreign investors, w ho can avail themselves of the same incentives as 
those granted to Salvadoran companies. 
                                                      
5 The general and specific requirements for registrati on in respect of each activity  can be viewed on the 
ONI website at:  http://www.minec.gob.sv/oni/h tml/proceso/registroCap italExtranjero.html. 
6 More information about PROESA is av ailable at:  http://www.proesa.com.sv/. WT/TPR/S/226/Rev.1 Trade Policy Review 
Page 16 
 
 
Table II.1 
Bilateral reciprocal investment prom otion and protection agreements signed by El Salvador, October 2009 
Country Date of signature Date of entry into force 
France 20 September 1978 12 December 1992 
Ecuador 16 May 1994 5 January 1996 
Switzerland 8 December 1994 16 September 1996 
Spain 14 February 1995 20 February 1996 
Argentina 9 May 1996 8 January 1999 
Peru 13 June 1996 14 December 1996 
Chinese Taipei 30 August 1996 15 February 1997 
Chile 8 November 1996 3 July 2002 
Germany 11 December 1997 15 April 2001 
Paraguay 30 January 1998 9 November 1998 
Korea 7 July 1998 25 May 2002 
Nicaragua 23 January 1999 8 July 2000 
United States 10 March 1999 Pending ratification 
Morocco 21 April 1999 11 April 2002 
Canada 31 May 1999 Pending ratification 
Belgium/Luxembourg 12 October 1999 18 November 2002 
Netherlands 12 October 1999 1 March 2001 
United Kingdom 14 October 1999 1 December 2000 
Czech Republic 30 November 1999 28 March 2001 
Israel 3 April 2000 7 July 2003 
Uruguay 24 August 2000 23 May 2003 
Belize 4 December 2001 Pending ratification by Belize 
Costa Rica 21 November 2001 Pending ratification by Costa Rica 
Finland 20 May 2002 20 February 2003 
Source : Information supplied by the Salvadoran authorities and the Foreign Trade Information System of the Organization 
of American States.  Viewed  at:  http://www.sice.oas.or g/ctyindex/SLV/ SLVBits_e.asp. 
 
22. El Salvador is a member of the Multilateral I nvestment Guarantee Agency (MIGA) and of the 
International Centre for Settlement of Investment  Disputes (ICSID).  At October 2009, only two cases 
involving El Salvador had been initiated in the ICSID:  Inceysa Vallisoletana S.L Railroad 
Development Corporation v. Republic of El Sa lvador (ICSID Case No. ARB/03/26) and PAC RIM 
Cayman v. Republic of El Salvador, in respect of which a request for arbitration had been registered 
(ICSID Case No. ARB/09/12) but no tribunal had yet been constituted.7 
(4) INTERNATIONAL RELATIONS  
(i) World Trade Organization 
23. El Salvador ratified the Marrakesh Agreement Establishing the World Trade Organization in 
May 1995 and has taken advantage of the periods of transition available to the developing countries.  
Table AII.1 sets out the list of notifications made by El Salvador to the WTO between January 2003 
and October 2009.  El Salvador made notifications during that period but at May 2009 some remained 
pending, including those concerning domestic suppor t for agriculture, State-trading enterprises, 
import licensing and customs valuation. 
                                                      
7 Information available on the ICSID website at:  http://icsid.worldbank.org/ICSID/FrontServlet? El Salvador WT/TPR/S/226/Rev.1 
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24. El Salvador participated in the negotiations  on basic telecommunications and on financial 
services held within the GATS framework and accepted  the Fourth and Fifth Protocols to the GATS.  
It also signed and ratified the amendments to the Agreement on Trade-Related Aspects of Intellectual 
Property Rights.  El Salvador has signed the Info rmation Technology Agreement, which is currently 
in the process of ratification by  the Legislative Assembly, although the authorities have emphasized 
that in practice a zero tariff is a pplied to the products in question. 
25. Pursuant to Article XIII of the Marrakesh Agre ement, El Salvador decided not to apply the 
multilateral trade agreements between El Salv ador and the People's Republic of China.8  Currently, 
El Salvador does not exclude any country from MFN treatment. 
26. El Salvador is taking an active part in the Doha Round, having put forward several proposals 
especially in conjunction with other Members.  El Salvador belongs to the Group of Small, 
Vulnerable Economies (SVE) and is a member of the Group of 33 (G-33). 
27. At the Ministerial Conference in Hong Kong, China, in 2005, El Salvador underlined the 
importance it attached to the agriculture negotiations in the Do ha Development Round.9  As a member 
of the G-33, El Salvador promotes special and di fferential treatment as an integral part of the 
agriculture negotiations.10  Together with the other SVE countries, El Salvador has submitted several 
proposals in different areas of the negotia tion, including market access in agriculture11;  market access 
for non-agricultural products12;  services;  and key aspects of the fisheries subsidies.13  An overview of 
these proposals is set out in document WT/COMTD/SEW/22/Rev.4 of 19 October 2009.  At the Seventh WTO Ministerial Conference held in Geneva  in November 2009, El Salvador reiterated the 
importance it attached to the multilateral tradi ng system and to the D oha Development Round 
negotiations.  It also emphasized its firm belief in the "development dimension" as an intrinsic 
criterion for the Organization's work and therefore s upported the incorporation of this dimension into 
each and every one of the areas that govern the multilateral trading system so that it becomes a genuine tool for responding to the needs of the de veloping countries and, in particular, the most 
vulnerable among them. 
28. El Salvador participated as a third party in four cases submitted to the WTO Dispute 
Settlement Body during th e period 2003-October 2009.
14 
(ii) Preferential agreements 
29. Most of El Salvador's trade involves partners with which El Salvador has signed preferential 
agreements.  It is participating in the process of establishing a customs union, the CACM, and also in 
several FTAs and partial scope agre ements.  In 2008 exports to count ries with which El Salvador had 
                                                      
8 WTO document WT/L/429 of 7 November 2001. 
9 WTO document WT/MIN(05)/S T/64 of 15 December 2005. 
10 Idem . 
11 Proposal by small, vulnerable economies on market access in agriculture, WTO document 
TN/AG/GEN/11 of 11 November 2005. 
12 WTO document TN/MA/W/66 of 11 November 2005. 
13 WTO document TN/RL/W/226/Rev.5 of 22 September 2008. 
14 European Communities - Measures Affecting th e Approval and Marketing of Biotech Products 
(complainant:  United States);  European Communities - Measures Affecting the Approval and Marketing of Biotech Products (complainant:  Canada);  European  Communities - Measures Affecting the Approval and 
Marketing of Biotech Products (complainant:  Argentina);  and Dominican Republic - Measures Affecting the 
Importation and Internal Sale of Cigarettes.  WTO documents in the series DS291, DS292, DS293 and DS302, DS308, DS332 and DS366. WT/TPR/S/226/Rev.1 Trade Policy Review 
Page 18 
 
 
preferential agreements in force accounted for 89.5 per cent of total exports;  the corresponding figure 
for imports was 65.2 per cent.15 
30. The main characteristics of the customs union a nd the FTAs that have entered into effect are 
outlined in Table AII.2.  The CACM and the FTA between the Dominican Republic, Central America 
and the United States are described below, these being the most important for El Salvador in terms of 
value of merchandise trade.  In addition, El Salva dor has signed agreements with Colombia, Chile, the 
Dominican Republic, Mexico, Panama and Chinese Taipei. 
(a) Central American Common Market (CACM) 
31. El Salvador is a founding member of the CACM  established in 1961, which also encompasses 
Costa Rica, Guatemala, Honduras, and Nicaragua.  Th e Tegucigalpa Protocol to the Charter of the 
Organization of Central American States, which h as been in force since July 1992, amended the 
regional legal framework by establishing the Central American Integration System as the institutional 
framework for Central American regional integration.   The Guatemala Protocol to the General Treaty 
on Central American Economic Inte gration, signed in 1993, entered into force on 17 August 1995 and 
it defines the objectives, principles and measures to achieve economic union. 
32. The institutional structure of the CACM consis ts of the Council of Ministers for Economic 
Integration (COMIECO);  the Intersectoral Counc il of Ministers for Economic Integration;  the 
Sectoral Council of Ministers for Economic In tegration;  the Executive Committee for Economic 
Integration (CEIE);  and the Secretariat for Cent ral American Economic Integration (SIECA).  The 
Central American Bank for Economic Integr ation (CABEI) acts as a support agency.16  T h e  
CACM has a number of regional regulations, includi ng the Uniform Central American Customs Code, 
together with Central American regulations on ru les of origin, unfair business practices, safeguard 
measures, standardization, and sanitary and phyto sanitary measures.  The CACM has had its own 
trade dispute settlement mechanism since 2003.  Un der Articles 22 and 23 of the Convention on the 
Central American Tariff and Customs Regime and Ar ticle 38 of the Guatemala Protocol, changes to 
the Central American Import Tariff are made by COMIECO. 
33. The vast majority of intra-CACM trade satisfyi ng regional rules of origin enter El Salvador 
and the other member countries duty free.  In Oc tober 2009, the common external tariff was 95.7 per 
cent harmonized.  To achieve this level of harmoni zation, COMIECO has adopted various resolutions 
on tariff amendments between 2003 and 2009.  In addition, the third and fourth amendments to the 
Harmonized System have been adopted. 
34. The list of products excluded from regional free tr ade has been steadily reduced.  El Salvador 
removed several exclusions during the period under re view, with the result that, at May 2009, the only 
                                                      
15 Calculations by the WTO Secretariat, on  the basis of information from the BCR. 
16 CABEI, founded in 1960 by Costa Rica, El Salvad or, Guatemala, Honduras and Nicaragua, has its 
headquarters in Tegucigalpa and aims  to promote the economic and social development of Central America.  
CABEI operates mainly through low-interest loans, and it generally finances infrastructure projects within the 
region. El Salvador WT/TPR/S/226/Rev.1 
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exceptions to regional free trade were for unroasted coffee and cane sugar.17  El Salvador additionally 
maintains exceptions for certain produc ts in respect of Honduras and Costa Rica.18 
35. The Framework Agreement Establishing the Ce ntral American Customs Union was signed on 
12 December 2007.  The Agreement, which was ra tified by El Salvador under Executive Decision 
No. 809 (Official Journal No. 138, Volume 380, of 23 July 2008), envisages  three stages in the 
customs union process:  institutional strengthening;  trade facilitation;  and regulatory convergence.  
In January 2009, El Salvador and Guatemala signed a Framework Customs Union Agreement to 
accelerate the process of integration between the two countries. 
36. Under Article 6 of the Guatemala Protocol, some or all members of the CACM may proceed 
at the speed agreed upon by them within the proc ess of Central American economic integration.  
El Salvador and Guatemala accordingly decided in 1996 to advance at a faster rate with the formation 
of a customs union.19  On 13 January 2000, the two countries signed the Framework Agreement for 
the Establishment of a Customs Union between the Te rritories of the Republic of El Salvador and the 
Republic of Guatemala, which entered into fo rce on 21 November 2002.  Subsequently, in 
January 2009, El Salvador and Guatemala signed the Protocol amending the Framework Agreement 
for the Establishment of a Customs Union between th e Territories of the Republic of El Salvador and 
the Republic of Guatemala, with a view to introduc ing some amendments to that Agreement.  The 
amendment seeks to provide for concrete measur es to establish the Customs Union between the 
two countries while ensuring that all the conditions necessary to achieve that objective are met in a 
gradual, incremental manner.  The Protocol in question is not yet in force. 
(b) Dominican Republic - Central America - United States Free Trade Agreement (CAFTA-DR) 
37. In January 2003, El Salvador and its four CA CM partners embarked upon formal negotiations 
for an FTA with the United States, which we re completed on 17 December 2003.  CAFTA-DR was 
signed on 5 August 2004 and ratified in El Salvador on 17 December 2004, under Legislative Decree 
No. 555 (Official Journal No 17, Volume 366, of 25 January 2005).  CAFTA-DR entered into force 
for El Salvador on 1 March 2006.  El Salvador has notified the FTA to the WTO.20 
38. The vast majority of the mutual obligations undertaken by the parties under CAFTA-DR are 
similar.  Some are implemented on a bilateral basis between the United States and each of the Central American countries or the Dominican Republic, in the case of tariff quotas for example.  
CAFTA-DR does not exclude any product from the liber alization process.  Most industrial products 
and consumer goods became duty free when CAFTA- DR entered into force.  Tariffs on other 
products will be eliminated over periods of five to  ten years, while agricultural products enjoy longer 
tariff reduction periods ranging from 15 to 20 years.
21  Tariff quotas were set for the transition periods 
                                                      
17 Trade in unroasted coff ee (HS 0901.1) is subject to MFN import duties;  cane sugar, whether or not 
refined (HS 1701.11.00, 1701.91.00, and 1701.99.00), is subject to import control, under tariff-free quotas.  
Imports exceeding quota volumes are subject to MFN duties. 
18 Concerning Honduras, import controls are maintained  on ethyl alcohol, and trade in distilled spirits 
(HS 22.08, except 2208.90.10) and petroleum products (HS 27.10, 27.12, 27.13, and 27.15, except mineral 
solvents of subheading 2710.11 and asphalt of subheading 2713.20.00) is subject to import duties.  As regards Costa Rica, trade in roasted coffee (HS 0901.2) is subject to import duties, while trade in ethyl alcohol (HS 2207 
and 208.90.10) is subject to import control.  Online information from the Ministry of the Economy.  Viewed at:  
http://www.minec.gob.sv/policom/media/downloa ds/Union%20Aduanera/ANEXO%20A%20TGIEC.doc. 
19 Resolution 27-96 (COMRIEDRE-IV) of 22 May 1996. 
20 WTO documents WT/REG211/N/3 and S/C/N/372 of 17 August 2006. 
21 The base rates for tariff reduction were the MFN tariffs in the Central Am erican Import Tariff in 
force on 1 September 2003.  In addition to the stag ing categories listed in Annex 3.3, paragraph 1, of WT/TPR/S/226/Rev.1 Trade Policy Review 
Page 20 
 
 
in the case of 40 agricultural products, which ge nerally have longer tran sition periods.  For 
El Salvador, the transition periods are 15 years for beef, pork and yellow maize, 18 years for rice and chicken thighs, and 20 years for dairy products (see Chapter IV(1)). 
39. The results for the period 2005-2008 show that  the implementation of CAFTA-DR coincided 
with an increase in exports from El Salvador to th e United States in the order of 20 per cent for the 
period in question, reaching US$2,184 million in 2008.
22  Imports from the United States amounted to 
US$3,336 million in 2008. 
(c) Other agreements 
40. El Salvador also has FTAs with the followi ng trading partners:  Mexico;  the Dominican 
Republic;  Chile;  Panama;  and the Separate Cu stoms Territory of Taiwan, Penghu, Kinmen and 
Matsu (Table AII.2). 
41. El Salvador has concluded several agreemen ts through the Latin American Integration 
Association (LAIA), including the partial scope agreements signed with Colombia and Venezuela.23  
El Salvador also participates in the LAIA's  Framework Agreement be tween MERCOSUR and the 
Central American Common Market, concluded in 1998,  which aims to foster trade, investment and 
technology transfer but does not include tariff preferences. 
42. El Salvador enjoys tariff preferences gran ted unilaterally by Australia, Canada, Japan, 
Norway, New Zealand, Russia and the European  Union under the Generalized System of 
Preferences (GSP).  It does not participate in the Global System of Trade Preferences among Developing Countries. 
43. El Salvador is a member of the Internationa l Coffee Agreement and the International Sugar 
Agreement. 
(d) Agreements awaiting approv al or under negotiation 
44. At October 2009 El Salvador, in conjunction with Guatemala and Honduras, had concluded 
an FTA with Colombia, although the agreement had not  yet entered into effect.  El Salvador ratified 
the instrument on 21 August 2008 under Legislat ive Decree No. 699 (Official Journal No. 171, 
Volume 380, of 12 September 2008).  When it enters into force, this FTA will replace the partial 
scope agreement referred to above. 
45. El Salvador and the other CACM members are negotiating an Association Agreement 
between the CACM and the European Union, with a view to improving political dialogue between the 
regions, intensifying cooperation in several fields , and facilitating trade and investment flows.  
Seven rounds of negotiations ha d been held by October 2009.
24  The negotiations include matters 
relating to trade in goods, trade in services and company formation, government procurement, 
                                                                                                                                                                     
CAFTA-DR, the schedule of El Salvador contains five staging categories with reduction periods of 10, 12, 14 
and 17 years. 
22 Foreign trade statistics from the BCR.  View ed at:  http://www.bcr.gob.sv/result.php. 
23 For further information on the LAIA and related agreements, see LAIA and Foreign Trade 
Information System websites, respec tively at:  http://www.aladi.org/ and 
http://www.sice.oas.org/TPD/ CACM_PAN/CACM_PAN_e.ASP. 
24 Up-to-date information on the negotiating rounds can be viewed at:  
http://www.aacue.go.cr/ultima.htm. El Salvador WT/TPR/S/226/Rev.1 
 Page 21 
 
 
intellectual property, competition, trade and sust ainable development, and dispute settlement and 
institutional aspects. 
46. El Salvador, Guatemala, Honduras and Nicara gua are negotiating FTAs with Canada and 
CARICOM - with Panama participating in the nego tiations with CARICOM.  El Salvador and the 
other CACM members are working to standardize th e various FTAs signed with Mexico, particularly 
as regards rules of origin. 
(5) AID FOR TRADE AND TECHNICAL ASSISTANCE  
47. During the period 2003-2007, El Salvador r eceived technical assistance from several 
organizations and countries, involvi ng a total of 141 projects and events (valued at US$15 million) for 
assistance in implementing trade policies and regulations, and a further 98 projects (worth 
US$63.5 million) on trade development.25 
48. In April 2007, the European Union presented a new cooperation programme for the region 
covering the period 2007-2013, based on a strategy in s upport of the political and social priorities of 
each of the countries of the region.  The proposed aid amounts to €121 million in the case of El Salvador, with a strategy in wh ich economic growth and the development of social cohesion are the 
main areas of cooperation.
26 
49. El Salvador has also benefited from techni cal assistance initiatives from other countries and 
agencies such as the United Stat es Agency for International Development (USAID), the Canadian 
International Development Agency (CIDA), the World Bank, the Inter-American Development Bank 
(IDB);  the United Nations Development Programme (UNDP);  the Agency for International Trade 
Information and Cooperation (AITIC);  the Organization of American States (OAS);  the 
United Nations Food and Agriculture Organizati on (FAO);  and the World Intellectual Property 
Organization (WIPO). 
50. During the period 2003-May 2009, El Salv ador benefited from 151 WTO technical 
cooperation and training activities, including particip ation in trade policy courses at regional level and 
in Geneva, as well as seminars and workshops on gene ral and specific aspects of international trade.  
At May 2009, El Salvador had not responded to the questionnaire on technical assistance distributed 
by the WTO Committee on Sanitary and Phytosanitary  Measures.  El Salvador participates in the 
WTO Aid-for-Trade Task Force, and has submitted  a proposal in conjunction with other countries.27 
                                                      
25 WTO/OECD, Doha Development Agenda Trade Capacity Building Database.  Viewed at:  
http://tcbdb.wto.org/ben_country.aspx?l  g=es&entityID=123&catCode=250&. 
26 European Commission (2007). 
27 WTO documents TN/TF/W/41 of 16 November 2005, and Add.1 to 4.