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Tuesday, May 28, 2013

El Salvador: Political and Economic Conditions and U.S. Relations

Clare Ribando Seelke
Specialist in Latin American Affairs

Congress has maintained a strong interest in developments in El Salvador, a small Central American country with a population of 6 million. During the 1980s, El Salvador was the largest recipient of U.S. aid in Latin America as its government struggled against the leftist Farabundo Marti National Liberation Front (FMLN) insurgency during a 12-year civil war. A peace accord negotiated in 1992 brought the war to an end and formally assimilated the FMLN into the political process as a political party. After the peace accords were signed, U.S. involvement shifted toward helping successive Nationalist Republican Alliance (ARENA) governments rebuild democracy and implement market-friendly economic reforms. 

Funes Administration 

Twenty-one years after the signing of the peace accords, El Salvador is governed by an FMLN Administration. In March 2009, Mauricio Funes, a former television journalist and the first FMLN presidential candidate without a guerilla past, defeated Rodrigo Ávila of the conservative ARENA party for a five-year presidential term. President Funes has generally pursued moderate policies that have enabled him to form cross-party coalitions in the National Assembly, but caused periodic friction with more radical members of his party.

Now in his fourth year in office, President Funes still has high approval ratings, but faces a number of serious challenges. His political influence has weakened since ARENA replaced the FMLN as the largest party in the legislature and the attention of both parties has turned to the 2014 presidential contest, which President Funes is constitutionally barred from contesting. Nevertheless, Funes successfully mediated a resolution to a months-long standoff between the Salvadoran judiciary and legislature over the composition and power of the Supreme Court in August 2012. In the economic realm, the Funes Administration is seeking to boost investment and growth, which has been inhibited by low productivity, natural disasters, and insecurity. In an attempt to address insecurity in the country, the Funes government endorsed a historic—and risky—truce involving the country’s largest gangs. The truce has contributed to a large reduction in homicides since March 2012. 

2014 Elections 

Political attention in El Salvador is turning toward the country’s March 2014 presidential elections. ARENA has selected Norman Quijano, the popular second-term mayor of San Salvador, as its standard bearer. His running mate is Rene Portillo Cuadro, a lawyer. The FMLN has chosen Salvador Sánchez Cerén, the current vice president and a former guerrilla leader, and Oscar Ortiz, the popular mayor of Santa Tecla. Former President Elías Antonio “Tony” Saca has also entered the race on a “Unity Movement” coalition ticket, but has yet to name a running mate. Saca could potentially force a runoff election. 

U.S.-Salvadoran Relations 

Congress has maintained an interest in events in El Salvador as well as bilateral relations, particularly in the security realm. During a March 2011 visit to El Salvador, President Barack Obama and President Funes pledged to strengthen cooperation through the new Partnership for Growth (PFG) initiative. The PFG commits both governments to work closely together to boost competitiveness and reduce insecurity in El Salvador. Congress has provided bilateral assistance, which totaled $28.2 million in FY2012, as well as aid provided through the Central American Regional Security Initiative (CARSI), in support of PFG priorities. The Millennium Challenge Corporation (MCC) recently completed a five-year, $461 million program that helped develop El Salvador’s northern border region. MCC has determined that El Salvador is eligible to submit a second compact proposal to develop its southern coastal region. It is as yet unclear how the U.S. Treasury Department’s recent designation of the MS-13 gang as a major transnational criminal organization whose assets will be targeted may affect bilateral anti-gang efforts.

This report examines current conditions in El Salvador as well as issues in U.S.-Salvadoran relations. For related information, see: CRS Report R41731, Central America Regional Security Initiative: Background and Policy Issues for Congress and CRS Report RL34112, Gangs in Central America.

Date of Report: April 5, 2013
Number of Pages: 26
Order Number: RS21655
Price: $29.95

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