El Salvador

An image of the country's flag.

The small, densely populated country of El Salvador has grown to achieve a GDP per capita of over $3600 for its 6.1 million people as of 2008. After a decade-long civil war in the 1980s, El Salvador instituted economic reforms in the early 1990s which diversified exports, brought about broad-based growth and increased school enrollment rates and access to health care. By 2002, poverty had been reduced by 27% and extreme poverty had been cut in half. However, after reaching moderate but pro-poor 4% economic growth rates in recent years, the global financial crisis and El Salvador’s close economic links to the

U.S. slowed growth and reversed prior progress in reducing poverty. Drops in export earnings and remittances from workers abroad coupled with higher food and energy prices caused the poverty headcount to rebound. The country faces major challenges in restoring growth and reducing poverty. Part of its long-term challenge is to create alternative employment opportunities for its large population of landless agricultural workers and subsistence farmers laboring on small, scattered plots of land. Insecure tenure and lack of access to land constrain investment in and development of the agricultural sector. In the medium term, El Salvador has increased its macroeconomic stability by adopting the U.S. dollar as its currency. If El Salvador can reduce the high rates of crime and violence that presently discourage investment, it is poised to benefit from an environment of low inflation, low interest rates, an increasingly favorable business climate and active participation in multiple free-trade agreements.


Under its economic growth and governance objectives, USAID might consider the following land and natural resource related interventions regarding land natural resources:

  • Update and improve information on land tenure and land markets. Current land tenure data collection has essentially been nonexistent in recent agricultural censuses. The data that does exist is scarce, may not be of appropriate scale or type and is inadequate to assess the current land tenure and property rights (LTPR) landscape fully and accurately. This limits the ability of policy makers to make appropriate decisions. USAID and other donors could support initiatives that will assist with the collection, standardization, maintenance and dissemination of land tenure data in El Salvador.
  • Support efforts to improve urban living conditions for the poor, including access to land. During the past decades, El Salvador has experienced rapid urban growth as a result of population growth, migration, civil war and natural disasters. This has severely taxed the capacity of both central and local governments to facilitate access to land, basic services and housing for much of the population. For most poor families, the most realistic choice has been moving into existing central city slums or squatting on government or privately owned land. USAID and other donors could support initiatives that (1) encourage the growth of formal settlements and (2) facilitate the formalization of slums and squatter settlements. This may include programs that occur at various levels, from assisting families to obtain legal access to land through sale or lease arrangements, to continuing to plan for progressive development and upgrading in slums or illegal settlements, to improving the capacity of the government to plan for and accommodate continued urban growth.
  • Improve land access and rights for vulnerable groups. A root cause of poverty in El Salvador is the inequitable distribution of land in rural areas. Initiatives to improve land access and land rights and modernize land registration processes have had positive impacts. However, the most vulnerable, including women, indigenous groups and the rural poor, continue to face obstacles despite these efforts. USAID and other donors could support programs that: (1) analyze the outcomes of previous projects (particularly the distributions of the 1990s, about which little is written) and their impacts on these vulnerable groups; (2) clarify and quantify the current status of land access, rights and registration; and (3) develop sustainable solutions to strengthen land access and rights.
  • Support conflict resolution and land use planning. Land and natural resource conflicts contribute to environmental degradation and biodiversity loss. Conservation of El Salvador’s biodiversity and tropical forests requires effective planning and regulation of the uses of the country’s terrestrial and marine territory, as well as management of conflicts the sector to better integrate with other development activities and gain greater political and public visibility and recognition; and (2) build capacity of stakeholders in the forestry sector to develop and implement processes and incentives to balance conservation with economic and household uses.
  • Support the validation and efficient management of protected areas. El Salvador has numerous areas that are pending transfer to MARN. Of areas that have been transferred, many have not been validated or made official as protected by MARN. As a result, these areas are vulnerable to land invasion by settlers, encroachment of agriculture and faulty titling. USAID and other donors could support MARN in finalizing the legal protected status of these areas. USAID and other donors could also assist in establishing protected areas on a firm legal, technical, administrative and financial basis; preparing technically between resource users and protected areas. USAID and other donors could support the incorporation of a legal conflict resolution process into the land use planning and regulation process. Such an approach could include financing training in conflict resolution processes and supporting the Ministry of Environment (MARN) in designing and implementing conflict resolution processes.
  • Strengthen water legislation and management capacity. Despite an abundance of water resources, severe pollution and contamination have undermined adequate water supplies, damaging public health and the environment for decades. The legal and administrative frameworks of the water sector are fragmented and decentralized. USAID and other donors could support initiatives that employ both a top-down approach (for example improving and clarifying the legal framework and harmonizing intergovernmental institutions and coordination) and a bottom-up approach (for example, developing integrated watershed management plans through local municipalities to address the future of clean water for all residents).
  • Build management capacity for forest resources. A variety of institutional weaknesses limit sustainable use of forests for conservation and economic development. These include isolation from other sectors and from other key stakeholders within the sector, a legacy of dependence on public resources and lack of expertise in developing potential financial processes and mechanisms to fund the sector. USAID and other donors could support initiatives that: (1) foster partnership activities within and outside of sound management plans for priority areas; and assisting in the transfer of natural areas to their appropriate governmental jurisdiction.


Inequitable land distribution has been a characteristic of agriculture and the rural economy in El Salvador since the 1700s. The plantation system that developed around mono-cropping was essentially feudal. As coffee became the major crop, communal land ownership was abolished and state security forces, paid by private landowners, were engaged to put down a series of peasant revolts. This system continued until the 1980s, by which time upward of 40% of families were landless and less than 2% of families held more than 10 hectares. The country had one of the largest, poorest work forces ruled by a powerful landowning class in Central America. The tense situation devolved into civil war in 1980.

The highly concentrated distribution of land has historically been at the root of conflict and civil war in the country. The Government of El Salvador (GOE) initiated agrarian reforms in the 1980s and 1990s that achieved limited success in addressing inequality, but landlessness and inequitable land distribution remain a problem. Land rights are not considered fully secure by many people in El Salvador and an estimated 57% of the rural population still does not have legal access to land. This is exacerbated by population density, which is among the highest in the world at 296 people per square kilometer.

One-third of all land parcels in the country are not included in the land registry and the poor often fail to register land transactions to avoid significant transfer taxes. Forty percent of the population live in rural areas, where poverty disproportionately affects those dependent on agriculture. Rural poverty is exacerbated by low incomes and limited employment opportunities, limited access to land and undeveloped market linkages. The remaining 60% of the population live in urban areas. Urbanization is fueled by rural landlessness, poverty and unemployment. An estimated 35% of urban dwellers live in informal or slum settlements.

Women continue to suffer from cultural and societal discrimination. Though there are a high number of female- headed households in El Salvador and women are key economic contributors to the agricultural sector and to household incomes, men dominate the agricultural and business sectors and are given preference in education, inheritance, jobs and promotions.

Deforestation, loss of biodiversity and water pollution are all serious problems in El Salvador. The country has rich water resources, though much of the surface water supply is contaminated and has not been developed for water supply. Ninety percent of El Salvador’s waterways and streams are contaminated due to soil erosion, siltation and pollution, and require treatment before drinking.

El Salvador, once almost entirely forested, has lost 85% of its forest cover since the 1960s. Due to extensive deforestation forests now cover only 14.4% of total land area. The high rate of deforestation appears to have decreased dramatically, but reliable data is limited. Mangroves along the coast have been subject to encroachment and degradation from agricultural conversion, relocation of displaced persons due to the civil war, excavation for commercial use and extensive harvesting for timber and fuel wood.

Mining in El Salvador has been linked to alleged human rights abuses and environmental damage, including cyanide contamination of groundwater and soil. Many larger mineral operations are controlled by foreign corporations, though small local entrepreneurs also contribute to the mining sector.

Published / Updated: January 2011

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