Foreword

Economic growth matters, but is just one facet of development. Policy makers need to reconcile economic, social, and environmental objectives to ensure that their country’s development path is sustainable and leads to durable improvements in citizens’ well-being.

OECD Development Pathways is a series that looks at development from the perspective of the multiple objectives it involves, beyond an exclusive focus on growth. It recognises well-being as part and parcel of development and helps governments identify the main constraints to more equitable and sustainable development by undertaking a multi-dimensional country review (MDCR). To meet their development ambition, governments need to understand the constraints they face and develop comprehensive and well-sequenced strategies that take into account complementarities and trade-offs across policies. The MDCR methodology combines quantitative economic analysis, qualitative approaches including foresight, and participatory workshops that involve actors from the private and public sectors, civil society and academia.

MDCRs are carried out in three distinct phases: Initial Assessment, In-depth Analysis and Recommendations, and From Analysis to Action. This approach allows for progressively deeper interaction between the OECD and the country and a mutual learning process about the country’s specific challenges and opportunities. It allows for the co-creation of policy solutions that fully respond to a country’s development challenges and opportunities, and come with guidance on implementation. The Mutual Learning Group for Multi-dimensional Country Reviews gathers policy makers in development strategy from countries undertaking MDCRs and members of the OECD Development Centre to support the exchange of experience on shared development challenges.

This review is the first of its kind to be implemented in El Salvador. El Salvador became a member of the OECD Development Centre in February 2019 and this review constitutes an important step in enhancing its engagement with the OECD. The review also offers avenues for further engagement in priority areas for the country. This report seeks to support El Salvador as it emerges from the impact of the COVID-19 pandemic and strives to deeply transform its development model. The report offers concrete policy options to address some of the country’s most important structural challenges.

The report is structured in two main parts. Part I evaluates the country’s performance across the dimensions of Agenda 2030. Part II provides an in-depth evaluation of four critical areas for the development of El Salvador: i) enabling a productive transformation, ii) managing water resources more effectively and sustainably, iii) investing in education and skills, and iv) strengthening public governance. In each of these areas, the review provides policy recommendations and detailed action plans to move from analysis to action.

This report is the result of a joint effort: it was led by the OECD Development Centre, with the participation of the Centre on Well-being, Inclusion, Sustainability and Equal Opportunity, the Directorate for Public Governance, the Economics Department, and the Environment Directorate, and with the collaboration and support of the Secretariat for Commerce and Investment of the Presidency of El Salvador, and the financial support of the European Union and the Grand Duchy of Luxembourg.