Nayib Bukele's Transformation of El Salvador

Plaza Gerardo Barrios in San Salvador, El Salvador

Nayib Bukele is one of the most polarizing leaders in Central America today. While he has transformed the nation of El Salvador from the most dangerous country in the Western Hemisphere to the safest, that change has not come without controversy. He has suspended the constitutional rights of his citizens, and many of the tens of thousands imprisoned within the past couple of years have not had the right to a fair trial. El Salvadorans seem to value their security over any perceived infringement of their rights, however, with polls giving Bukele a whopping 91% approval rate. That is a number seen by very few leaders worldwide and may point to a regional or global shift away from solely focusing on democratic principles and instead placing more value on the efficiency and efficacy of governments. Mr. Bukele has tried to build rapport with other world leaders who also think this way, like President Trump, who has recently said that “If it saves the country, it’s not illegal.” Bukele has told Trump that he would not only be willing to imprison deported illegal migrants who have committed crimes but also violent criminals who are citizens of the United States. While these claims have not been taken seriously by the United States, the ideas they are derived from point to a larger trend towards a “might is right” philosophy and away from the post-1945 world order. 

After his second inauguration last June, the Bukele administration added the economy to its list of issues to tackle. Now that the country is safer and better suited for foreign investment, Bukele will have to deliver on promises to revitalize the nation's economy and put El Salvador at the cutting edge. From the balcony of the National Palace in San Salvador, Bukele has said that the nation has gotten rid of its “cancer” (the high crime rates) but that “it is still sick” with economic woes. With the cancer of high crime gone, businesses can now take the dues they were originally paying to their local gangs and invest them. In April 2024, Google opened a new office in San Salvador, the nation's capital, stating that it wanted to help revitalize the country. Bukele has also pledged $100 million to the government’s Surf City II project, which aims to develop the nation’s Pacific coast and expand access to beaches used for watersports. 

Bukele has also used a not-insignificant chunk of the country’s currency reserves to hold Bitcoin, a controversial move that reached international headlines four years ago. Starting in 2021, the nation began to accumulate cryptocurrency. Currently, their reserves hold about 6,100 Bitcoin, or USD 530 million. Some experts say that this gamble has backfired because even though prices have risen, loans with the International Monetary Fund to foster development and finance debt could fall through due to El Salvador’s reluctance to stop buying tokens. Bukele does not seem to be backing down, as he has recently ordered the purchase of another round of tokens. "'This all stops in April.' 'This all stops in June.' 'This all stops in December.' No, it’s not stopping," Bukele posted on X on March 4th. "If it didn’t stop when the world ostracized us and most 'bitcoiners' abandoned us, it won’t stop now, and it won’t stop in the future. Proof of work > proof of whining." With the El Salvadoran government and the IMF recently agreeing to a 1.4 billion dollar loan on the condition that the government not engage in the voluntary purchase of tokens, it is now unclear whether or not the conditions of the loan will be met. 

In areas other than Bitcoin, Bukele seems to be succeeding in his goals. Part of his plan to reinvigorate the El Salvadoran economy has been to transform the country’s image to attract foreign investors. It is hard to argue that he has not done that. Nayib Bukele has appeared in Time Magazine and earned the moniker “World’s Most Popular Dictator,” a name he wears with pride. On social media, posts showing the crime rate of El Salvador dropping to below that of the United States earn millions of likes, with energetic commenters singing Bukele’s praises. Other Latin American countries have followed Bukele’s crime-reduction strategies, coining the term Bukelismo to describe them. 

The nation’s legislature has also made it easier for outside entities to invest. A law has been passed to make capital flow into the country exempt from taxation, a drastic change from the original tax of 30%. Tourism is El Salvador’s fastest growing sector, with the United Nation’s World Tourism Organization placing it as the fastest growing destination in the Americas. To diversify foreign investment, Bukele’s government has also encouraged large-scale public-private partnerships to develop the nation’s infrastructure and provide opportunities for American companies. At the top of the list are increased road connectivity, airport capacity, logistics, and access to water and energy. With no access to the Atlantic, El Salvador also heavily relies on land-based trade. The majority of its exports go through Honduran and Guatemalan ports, and El Salvador has taken multiple steps in recent years to help increase efficiency. In 2018, El Salvador began the process of joining a Customs Union with Honduras and Guatemala, which, while not yet finished, will further develop El Salvador as a promising and efficient place to invest. Overall, even though there is controversy present, El Salvador and its eccentric leader seem to be taking the right steps in order to transform and reinvigorate their image and economy.