Editor’s notes
‘Homicide rates have dropped significantly and in our interviews across the country people consistently report feeling safer from the gang violence that terrorised communities for decades. There is no denying of that fact and its importance for the human rights of Salvadorans. At the same time, security forces have committed widespread human rights violations.’
So said Juan Pappier, the Americas deputy director at Human Rights Watch, in April 2026, in a statement to the Tom Lantos Human Rights Commission (TLHRC), a bipartisan body of the United States House of Representatives.
Despite a widely questioned record on human rights and the ongoing authoritarian political activity of the country’s millennial President (and former publicist and Bitcoin proponent) Nayib Bukele, as well as the still-low adoption rate of Bitcoin by citizens and businesses, the July 2021 downgrading by Moody’s of the nation’s credit rating (around the time the value of Bitcoin had dropped by 23% to $37k), the November 2022 collapse of the FTX cryptocurrency exchange and the eventual revoking of Bitcoin’s status as legal tender in early 2025, the Salvadoran market is currently in a state of modest growth and is an emerging destination of interest for (some) overseas investors.
In the same month that FTX declared insolvency, Bukele announced a free trade deal with China, with Vice-President Félix Ulloa stating that as part of the deal China had offered to purchase the country’s $21bn in foreign debt. Such economic manoeuvres, coupled with aggressive tax revenue collection, have led to a more positive forecast than previously projected. According to the February 2023 conclusion of an IMF mission, the Salvadoran economy was estimated to have expanded by 2.8% in 2022 as a result of domestic demand and the government’s effective response to the Covid-19 pandemic.
In addition, the revocation of Bitcoin as legal tender in early 2025 led to the approval by the IMF of a $1.4bn, 40-month extended fund facility (EFF) to assist with fiscal sustainability and reduce debt.
The IMF currently projects El Salvador’s GDP will grow by 3.3% in 2026, attributed to continued expansion of the tourism and construction sectors.
Growth has also been tied to the decline in crime.
‘They kept hitting me, in the stomach, and when I tried to breathe, I started to choke on the blood. My cellmates shouted for help, saying they were killing us, but the officers said they just wanted to make us suffer.’
So said one of the 252 Venezuelan migrants deported by the Trump administration to the Centre for Terrorism Confinement (Centro de Confinamiento del Terrorismo, CECOT), a maximum security prison built at the order of Bukele, after President Trump’s controversial invoking of the 1798 Alien Enemies Act – which grants the president the wartime authority to expel nationals of foreign countries engaged in a “declared war” against the US.
Equally controversial has been the Bukele government’s campaign against organised crime, which has resulted in approximately 1.8% (as of this writing) of the population being incarcerated without due process.
The government’s anti-crime initiatives under Bukele (who, infamously, after addressing the UN General Assembly changed his Twitter bio to read ‘world’s coolest dictator’) have received condemnation from human rights organisations.
After blaming several days of violence and 87 killings on the gang known as MS-13, on 27 March 2022 Bukele’s government declared a state of emergency, suspending constitutional rights (foremost of which was the presumption of innocence). This led to the arrests (many reportedly arbitrary) of 6,000 citizens accused of being gang members and the passing of a congressional measure authorising ten to 15-year prison sentences for members of the media who transmit to the public ‘messages or statements originating or presumably originating from said criminal groups, that could generate anxiety and panic in the population’ – an act which has led to allegations of a crackdown on freedom of the press.
By May 2023, the number of arrests reached over 66,000. The same month, human rights organisation Cristosal released a report, according to which prisoners arrested during the crackdown had been tortured, with 153 dying in custody, showing signs of ‘asphyxiation, fractures, significant bruising, lacerations and even perforations’.
The policy does have its proponents.
‘A lighthouse in a world roiled by organised crime,’ said Chilean President José Antonio Kast of El Salvador under Bukele; Kast is a public supporter of the military dictatorship of Augusto Pinochet, the policies of which resulted in the murder of over 3,000 people, with over 27,000 tortured and 1,469 forcibly disappeared.
The growing stability of the market, the downturn in crime and the human rights situation continues to have a pronounced impact on El Salvador’s legal markets.
In banking and finance, respondent firms report a rise in interest from foreign investors, as a result of the declining crime rates, with investors viewing the nation as a safe place to invest. Banking and finance teams also pointed to the August 2025 Investment Banking Law, which allows financial institutions to register as investment banks and offer financial services in digital assets, as a driver in business for firms tied to tokenisation.
In the corporate arena, teams report a rise in cross-border M&A. Respondent firms indicate growth in the areas of fintech, health and real estate. Interviewed firms predict a rise in health tourism and travel.
In dispute resolution, respondent firms indicate that the nation’s March 2026 launch of a new Intellectual Property Mediation, Conciliation and Arbitration Centre (CEMCAPI) in San Salvador will lead to a greater streamlining of ADR involving IP. Teams predict increased arbitrations, and a rise in crypto fraud disputes and construction claims.
Similarly, in the intellectual property sphere, teams are optimistic about the promise of CEMCAPI. Firms interviewed have also described a rise in regional trademark investments. Teams predict a rise in IP activity tied to the construction sector.
Tax teams report increased business tied to digital assets following the passage of the Investment Banking Law.
In terms of the Salvadoran legal landscape, regional firms such as Arias, Consortium Legal and BLP continue to be leaders across most practice areas, while other notable Central American outfits include GarciaBodan, Aguilar Castillo Love (noted for its expertise in fintech), Lexincorp, Mayora & Mayora, S.C. and Central Law El Salvador. A growing number of global firms also have a presence in the Salvadoran market, including Ecija, EY Law Central America and, most recently, Dentons Central America. Full-service domestic firm Romero Pineda also remains a standout (particularly for intellectual property matters), while Torres Legal is an up-and-coming Salvadoran practice. Local firm Espino Nieto & Asociados is also recognised for IP.
A key move was EY Law Central America’s November 2025 hiring of ex-GarciaBodan managing partner Oscar Torres and his team. Another major development was the September 2025 arrival at Deloitte Legal of the market-leading tax team of Héctor Mancía, Carlos Gaitán and Douglas Morales (the former practice head and managers) from EY Law Central America.