Remittance revenues are the country's key source of hard currency. They now amount to 13.5% of GDP, or 65% of export receipts. They cover around 80% of the trade deficit.
The decision by the US to extend the Temporary Protection Status (TPS) for undocumented migrants in the US should keep the money flowing. The US agreed to extend the TPS, which was originally offered as part of the aid package following the earthquakes that hit the country in early 2001.
The US agreed to extend the TPS for another 18 months, from 9 September this year. The TPS allows 248,000 Salvadoreans to go on working in the US. The Salvadorean government reckons that there are a total of around 2.3m Salvadoreans working in the US.
Privatisation: An international leftwing organisation, Social Watch , claims that the privatisation programme was implemented without transparency. The programe was supposed to cut the size of the government and generate capital to pay down the debt and to improve infrastructure.
Social Watch, which is based in Uruguay, said that even the private sector had misgivings about the way privatisations had been handled in the country. Social Watch claimed that there was no need for telecoms privatisation.
The privatisation programme began in 1989 with the sale of banks and coffee and sugar exporters. The oil company and the Hotel President were also sold. In the second phase, between 1994 and 1999, sugar mills, electricity distribution companies, telecoms companies and the vehicle licensing and driving licence agency were sold.
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