World Bank2013-02-152013-02-152010-11https://hdl.handle.net/10986/12372This Public Expenditure Review (PER), produced jointly by the World Bank and the Inter-American Development Bank (IADB), is an in-depth economic and sector report on El Salvador. The study builds on the analysis and recommendations of the PER delivered in 2004 that concluded that El Salvador faced the dual challenge of addressing deteriorating fiscal trends while financing key investments required to accelerate growth and meet pressing social needs. This report is intended to provide the government with practical and useful near-and medium-term recommendations that will support the country's efforts to ensure sustainable fiscal balances and establish effective and transparent mechanisms to allocate public resources to promote broad-based economic growth, improve social indicators, and reduce poverty. Hence, the government knows that El Salvador is faced with two fiscal challenges that will have great influence on the economic performance over the coming years. The first is the need to improve the fiscal balance, by strengthening revenue and reducing expenditure, to ensure medium-term sustainability. The second is the need to finance priority investments required to accelerate growth, reduce unemployment, and cover basic social needs. Meeting both challenges simultaneously will require great skill, given the still fragmented political environment and the difficulties in creating a consensus on future policies. The country needs to strengthen its fiscal stance because not doing so jeopardizes the medium-term macroeconomic framework, and exposes the country to greater vulnerability in the face of external shocks and contingent liabilities.en-USCC BY 3.0 IGOARREARSAUCTIONSBALANCE SHEETBANK ACCOUNTBANKING LAWBASELINE SCENARIOBENEFICIARIESBENEFICIARYBOND INDEXBONDSBUDGET FRAMEWORKBUDGET PROCESSBUDGETARY PROCESSCAPITAL GAINSCAPITALIZATIONCASH TRANSFERCENTRAL BANKCENTRAL GOVERNMENT DEBTCOMPETITIVE MARKETCONTINGENT LIABILITIESCONTINGENT LIABILITYCURRENCYCURRENCY COMPOSITIONCUSTODYDEBTDEBT BURDENDEBT INSTRUMENTSDEBT ISSUESDEBT MANAGEMENTDEBT MANAGEMENT POLICYDEBT MARKET DEVELOPMENTDEBT RATIODEBT SERVICEDEBT SERVICINGDEBT SUSTAINABILITYDEGREE OF TRANSPARENCYDEPOSITDEVELOPMENT BANKDOMESTIC CAPITALDOMESTIC CAPITAL MARKETDOMESTIC DEBTDOMESTIC DEBT MARKETDOMESTIC DEBT MARKETSDOMESTIC MARKETDOUBLE TAXATIONECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC SHOCKSEFFICIENCY OF GOVERNMENT SPENDINGEMERGING MARKETSEXPENDITUREEXPENDITURESEXPORTERSEXTERNAL AUDITFINANCIAL CRISISFINANCIAL INFORMATIONFINANCIAL INSTRUMENTSFINANCIAL MANAGEMENTFINANCIAL PORTFOLIOFINANCIAL STABILITYFINANCIAL STRUCTURESFISCAL BURDENFISCAL DEBTFISCAL DISCIPLINEFISCAL EFFORTFISCAL POLICYFISCAL REFORMFISCAL SUSTAINABILITYFIXED CAPITALFOREIGN INVESTORSFOREIGN LOANSFUNGIBLEGOVERNMENT BONDGOVERNMENT BOND MARKETGOVERNMENT EXPENDITUREGOVERNMENT FINANCESGOVERNMENT INVOLVEMENTGOVERNMENT REVENUESGOVERNMENT SPENDINGGROSS DOMESTIC PRODUCTHOLDINGHUMAN RESOURCESIMMUNIZATIONIMPLICIT SUBSIDIESIMPLICIT SUBSIDYINCOME TAXINFLATIONINFORMATION SYSTEMINFORMATION SYSTEMSINSURANCEINTEREST PAYMENTSINTEREST RATESINTERNATIONAL BANKINTERNATIONAL DEVELOPMENTINTERNATIONAL FINANCIAL CRISISINTERNATIONAL MARKETSINTERNATIONAL STANDARDSINVESTMENT FUNDINVESTMENT POLICIESINVESTMENT PROJECTSINVESTMENT REGULATIONSINVESTMENT SPENDINGINVESTOR BASEJUDICIAL ENFORCEMENTLABOR MARKETLACK OF TRANSPARENCYLEGAL PROVISIONSLIABILITY MANAGEMENTLIQUIDITYLOCAL GOVERNMENTSLOCAL MARKETMACROECONOMIC STABILITYMACROECONOMIC VARIABLESMARKET DEBTMARKET INFRASTRUCTUREMARKET PRICEMARKET TRANSACTIONSMATURITIESMATURITYMATURITY STRUCTUREMEDIUM-TERM MACROECONOMIC FRAMEWORKMEDIUM-TERM PLANMEDIUM-TERM SECURITIESMICROFINANCEMINISTRY OF FINANCEMONETARY FUNDMONEY MARKETMONEY MARKETSMUTUAL FUNDSOIL PRICESOLD-AGE PENSIONPENSIONPENSION FUNDPENSION FUND INVESTMENTSPENSION FUNDSPENSION LIABILITIESPENSION SYSTEMPENSION SYSTEMSPENSIONSPERSONAL INCOMEPERSONAL INCOME TAXPOLITICAL ECONOMYPOLITICAL UNCERTAINTIESPORTFOLIOPORTFOLIOSPOVERTY REDUCTIONPOVERTY-REDUCING IMPACTPRICE VOLATILITYPRIMARY MARKETPROFIT MARGINSPROGRAMSPUBLIC DEBTPUBLIC DEBT MANAGEMENTPUBLIC EXPENDITUREPUBLIC EXPENDITURE REVIEWPUBLIC EXPENDITURESPUBLIC FINANCESPUBLIC INVESTMENTPUBLIC INVESTMENTSPUBLIC SECTORPUBLIC SECTOR DEBTPUBLIC SPENDINGRATE OF RETURNREAL INTERESTREAL INTEREST RATEREFORM AGENDAREFORM EFFORTSREGULATORY FRAMEWORKREMITTANCESREPOSRESERVERESERVE BANKRETURNSREVENUE INCREASESSAVINGS ACCOUNTSAVINGS ACCOUNTSSECONDARY DEBTSECONDARY DEBT MARKETSECONDARY MARKETSECONDARY MARKET DEVELOPMENTSECURITIESSERVICE DELIVERYSETTLEMENTSETTLEMENT INFRASTRUCTURESHORT TERM DEBTSOCIAL SERVICESOCIAL SERVICESSTATE GUARANTEESTOCK EXCHANGESTRATEGIC PRIORITIESSUSTAINABILITY ANALYSISTAXTAX ADMINISTRATIONTAX BASETAX CODETAX COLLECTIONTAX DEDUCTIONSTAX EXEMPTIONTAX EXEMPTIONSTAX EXPENDITURESTAX POLICYTAX RATESTAX REVENUETAX REVENUESTAX SYSTEMTAXPAYERSTIGHT FISCAL POSITIONTOTAL EXPENDITURESTOTAL PUBLIC SECTORTOTAL SPENDINGTRANSACTIONTRANSACTION COSTSTRANSPARENCYTREASURYTREASURY BILLSTREASURY CREDITTRUST FUNDTRUST FUNDSWITHDRAWALEl Salvador - Public Expenditure Review : Enhancing the Efficiency and Targeting of Expenditures, Volume 1. Main ReportWorld Bank10.1596/12372