U.S. DEPARTMENT OF STATE
BACKGROUND NOTES:  EL SALVADOR
PUBLISHED BY THE BUREAU OF PUBLIC AFFAIRS
NOVEMBER 1994

Official Name:  Republic of El Salvador

PROFILE

Geography
Area:  21,476 sq. km. (8,260 sq. mi.); about the size of Massachusetts.
Cities:  Capital--San Salvador (pop. 1.4 million).  Other cities--Santa 
Ana, San Miguel.
Terrain:  Mountains separate country into three distinct regions--
southern coastal belt; central valleys and plateaus; and northern 
mountains.
Climate:  Semitropical, distinct wet and dry seasons.

People
Nationality:  Noun and adjective--Salvadoran(s).
Population:  5 million.
Annual growth rate (1993): 2.2%.
Ethnic groups:  Mestizo 89%, indigenous 10%, Caucasian 1%.
Religion:  Largely Roman Catholic, with growing Protestant groups 
throughout the country.
Language:  Spanish.
Education:  Years compulsory--6.   Attendance--82%.  Literacy--65% among 
adults.
Health:  Infant mortality rate (1993)--47/1,000.  Life expectancy 
(1993)--males 64 yrs., females 65 yrs.
Work force (2.5 million):  Agriculture--40%.  Services--25%.  Industry--
19%.  Other--16%.

Government
Type:  Republic.
Constitution:  December 20, 1983.
Independence:  September 15, 1821.
Branches:  Executive--president and vice president.  Legislative--84-
member Legislative Assembly.  Judicial--independent (Supreme Court).
Administrative subdivisions:  14 departments.
Political parties:  Nationalist Republican Alliance (ARENA), Farabundo 
Marti National Liberation Front (FMLN), Christian Democratic Party 
(PDC), National Conciliation Party (PCN), Democratic Convergence (CD), 
Unity Movement (MU).
Suffrage:  Universal at 18.

Economy (1993)
GDP:  $7.6 billion.
Annual growth rate:  5%.
Per capita income:  $1,494.
Agriculture (9% of GDP):  Products--coffee (30% of agricultural output), 
sugar, livestock, corn, poultry, sorghum.  Arable, cultivated, or 
pasture land--67%.
Industry (19% of GDP):  Types--food and beverage processing, textiles, 
footwear and clothing, chemical products, petroleum products.
Trade:  Exports--$732 million:  coffee, sugar, textiles and shrimp.  
Partners--U.S. 29%, Central American Common Market (CACM) 42%, European 
Union (EU) 16%, Japan 2%.  Imports--$1.9 billion:  consumer goods, 
foodstuffs, capital goods, raw industrial materials, petroleum.  
Partners--U.S. 44%, CACM 17%, EU 10%, Mexico 5.8%, Venezuela 5%.
Exchange rate (1994 avg.):  8.7 colones=U.S. $1.


PEOPLE AND HISTORY

El Salvador's population numbers about 5 million; almost 90% is of mixed 
Indian and Spanish extraction.  About 10% is indigenous; very few 
Indians have retained their customs and traditions.  The country's 
people are largely Roman Catholic--though Protestant groups are growing-
-and Spanish is the language spoken.  The capital city of San Salvador 
has about 1.4 million people; an estimated 58% of El Salvador's 
population lives in rural areas.

Before the Spanish conquest, the area that is now El Salvador was made 
up of two large Indian states and several principalities.  The 
indigenous inhabitants were the Pipils, a tribe of nomadic Nahua people 
long established in Mexico.  Early in their history, they became one of 
the few Mesoamerican Indian groups to abolish human sacrifice.  
Otherwise, their culture was similar to that of their Aztec neighbors.  
Remains of Nahua culture are still found at ruins such as Tazumal (near 
Chalchuapa), San Andres (northeast of Armenia), and Joya De Ceren (north 
of Colon).

The first Spanish attempt to subjugate this area failed in 1524, when 
Pedro de Alvarado was forced to retreat by Pipil forces.  In 1525, he 
returned and succeeded in bringing the district under control of the 
Captaincy General of Guatemala, which retained its authority until 1821 
despite an abortive revolution in 1811.

Independence

In 1821, El Salvador and the other Central American provinces declared 
their independence from Spain.  When these provinces were joined with 
Mexico in early 1822, El Salvador resisted, insisting on autonomy for 
the Central American countries.  Guatemalan troops sent to enforce the 
union were driven out of El Salvador in June 1822.  El Salvador, fearing 
incorporation into Mexico, petitioned the U.S. Government for statehood.

But in 1823, a revolution in Mexico ousted Emperor Augustin Iturbide, 
and a new Mexican congress voted to allow the Central American provinces 
to decide their own fate.  That year, the United Provinces of Central 
America was formed of the five Central American states under Gen. Manuel 
Jose Arce.  When this federation was dissolved in 1838, El Salvador 
became an independent republic.

El Salvador's history as an independent state--as with others in Central 
America--was marked by frequent revolutions; not until the period 1900-
30 was relative stability achieved.  The economic elite ruled the 
country in conjunction with the military, and the power structure was 
controlled by a relatively small number of wealthy landowners, known as 
"the 14 Families."  The economy, based on coffee-growing, prospered or 
suffered as the world coffee price fluctuated.

From 1932--the year of Gen. Maximiliano Hernandez Martinez's coup 
following his brutal suppression of rural resistance--until 1980, every 
Salvadoran President  was an army officer.  The one exception was a 
provisional executive who served for four months.  Periodic presidential 
elections were seldom free or fair.

From Military to Civilian Rule

During the 1970s, the political, social, and economic situation began to 
deteriorate.  The military leadership created its own party, the 
National Conciliation Party (PCN), which nominated Col. Arturo Molina in 
the 1972 presidential election.  The opposition united under Jose 
Napoleon Duarte, leader of the Christian Democratic Party (PDC).  Amid 
widespread fraud, Duarte's broad-based reform movement was defeated.  
Subsequent protests and an attempted coup were crushed, and Duarte was 
exiled.  These events eroded hope of reform through democratic means and 
persuaded many opponents of military rule that armed insurrection was 
the only way to achieve change.  Leftist groups capitalizing upon social 
discontent gained strength.  By 1979, guerrilla warfare had broken out 
in the cities and the countryside, launching what became a 12-year civil 
war.

The cycle of violence accelerated as rightist vigilante "death squads" 
killed thousands.  The poorly trained Salvadoran Armed Forces (ESAF) 
also engaged in repression and indiscriminate killings.  The country's 
antiquated judicial system was unable to cope with the lawlessness.  
Opposition to the government's agrarian reform program fed rural 
conflict.  After the 1979 collapse of the Somoza regime in Nicaragua, 
the new Sandinista government provided large amounts of arms and 
munitions to five Salvadoran guerrilla groups, and a military victory by 
the guerrillas appeared possible.

On October 15, 1979, reform-minded military officers and civilian 
leaders ousted the right-wing government of Gen. Carlos Humberto Romero 
(1977-79) and formed a revolutionary junta.  PDC leader Duarte joined 
the junta in March 1980, leading the provisional government until the 
elections of March 1982.  The junta initiated a land reform program and 
nationalized the banks and the marketing of coffee and sugar.  Political 
parties were allowed to function again, and on March 28, 1982, 
Salvadorans elected a new constituent assembly.  Following that 
election, authority was peacefully transferred to Alvaro Magana, the 
provisional president selected by the assembly.

The 1983 constitution, drafted by the assembly, strengthened individual 
rights; established safeguards against excessive provisional detention 
and unreasonable searches; established a republican, pluralistic form of 
government; strengthened the legislative branch; and enhanced judicial 
independence.  It also codified labor rights, particularly for 
agricultural workers.  The newly initiated reforms, though, did not 
satisfy the guerrilla movements, which had unified under Cuban auspices 
as the Farabundo Marti National Liberation Front (FMLN).

Duarte won the 1984 presidential election against Roberto D'Aubuisson of 
the Nationalist Republican Alliance (ARENA) with 54% of the vote and 
became the first freely elected president of El Salvador in more than 50 
years.  Legislative and municipal elections were held in 1985 and 1988.

In 1989, ARENA's Alfredo Cristiani won the presidential election with 
54% of the vote.  His inauguration on June 1, 1989, marked the first 
time in decades that power had passed peacefully from one freely elected 
civilian leader to another.

In 1990, reform of the electoral system expanded the assembly from 60 to 
84 deputies in order to broaden the base of representation from the 
smaller parties and increase the opportunity for the parties of the left 
to win office.  In the March 1991 assembly election, ARENA lost its 
majority in the Legislative Assembly, winning only 39 seats.  The PDC 
took 26 seats, the PCN nine, the Democratic Convergence (CD) eight, and 
two small parties one each.

Ending the Civil War

Upon his inauguration in June 1989, President Cristiani called for 
direct dialogue to end the decade of conflict between the government and 
guerrillas.  An unmediated dialogue process involving monthly meetings 
between the two sides was initiated in September 1989, lasting until the 
FMLN launched a bloody, nationwide offensive in November that year.

In early 1990, following a request from the Central American presidents, 
the UN became involved in an effort to mediate direct talks between the 
two sides.  After a year of little progress, the government and the FMLN 
accepted an invitation from the UN Secretary General to meet in New York 
City.  On September 25, 1991, the two sides signed the New York City 
Accord.  It concentrated the negotiating process into one phase and 
created the Committee for the Consolidation of the Peace (COPAZ), made 
up of representatives of the government, FMLN, and political parties, 
with Catholic Church and UN observers.

On December 31, 1991, the government and the FMLN initialed a peace 
agreement under the auspices of Secretary-General Perez de Cuellar.  The 
final agreement, called the Accords of Chapultepec, was signed in Mexico 
City on January 16, 1992.  A nine-month cease-fire took effect February 
1, 1992, and was never broken.  On December 15, 1992, world dignitaries-
-including UN Secretary General Boutros Boutros-Ghali and then-Vice 
President Quayle--attended a ceremony marking the official end of the 
conflict, concurrent with the demobilization of the last elements of the 
FMLN military structure and the FMLN's inception as a political party.


GOVERNMENT AND POLITICAL CONDITIONS

El Salvador is a democratic republic governed by a president and an 84-
member Legislative Assembly.  The president is elected by universal 
suffrage and serves for a five-year term.  Members of the assembly, also 
elected by universal suffrage, serve for three-year terms.  The country 
has an independent judiciary and Supreme Court.

In March 1994, the first post-civil war elections were held, featuring 
simultaneous presidential, legislative, and municipal races.  The FMLN 
participated in those elections and emerged as the second-largest 
political party in El Salvador.  ARENA won 39 seats in the Legislative 
Assembly, the FMLN won 21 seats, the PDC 18, the PCN four, and the CD 
and Unity Movement (MU) one each.  ARENA presidential candidate Armando 
Calderon Sol faced FMLN-CD coalition candidate Ruben Zamora in a runoff 
in April and won with 68% of the vote.  UN observers declared the 
elections free and fair.  Armando Calderon Sol of the ARENA party began 
his five-year term as President on June 1, 1994, and cannot succeed 
himself.

Political Parties and Other Groups

ARENA is El Salvador's leading political party.  It was created in 1982 
by Roberto D'Aubuisson and other ultra-rightists, including some from 
the military.  His electoral fortunes were diminished by credible 
reports that he was involved in organized political violence.  Following 
D'Aubuisson's defeat by Jose Napoleon Duarte in the 1984 presidential 
election, ARENA began reaching out to more moderate individuals and 
groups, particularly in the private sector.

By 1989, ARENA had attracted the support of business groups and 
nominated Alfredo Cristiani--a moderate businessman and coffee grower--
as its presidential candidate.  ARENA was thus well positioned to 
benefit from popular discontent with the 1984-89 Duarte administration.  
Despite sincere efforts at reform by Duarte's PDC administration, 
failure to either end the insurgency or improve the economy, allegations 
of corruption, poor relations with the private sector, and historically 
low prices for the nation's main agricultural exports contributed to 
ARENA victories in the 1988 legislative elections and the 1989 
presidential elections.

In 1994, ARENA put well-known businessman Enrique Borgo Bustamante on 
the ticket as Calderon Sol's running mate in an effort to further 
bolster its moderate, pro-business image.  The 1989-94 Cristiani 
administration's successes in achieving a peace agreement to end the 
civil war and in improving the nation's economy helped ARENA keep both 
the presidency and a working majority in the Legislative Assembly in the 
1994 elections.  ARENA has benefited from having been the governing 
party when peace came to El Salvador, and Calderon Sol has emphasized 
his commitment to carrying out the remaining elements of the peace 
accords.

The FMLN became a political party in December 1992 and immediately 
supplanted the CD as El Salvador's leading party of the political left.  
It is composed of five factions that do not always agree, sometimes 
leading to very public ruptures.  Nevertheless, the FMLN maintained a 
united front during the 1994 electoral campaign and joined with the CD 
and National Revolutionary Movement (MNR) to support CD Secretary 
General Ruben Zamora for president.

This coalition succeeded in keeping Calderon Sol from winning 50% in the 
first round and thus established itself as the sole alternative to ARENA 
in the second round.  The FMLN also came in second in the assembly 
races.  As the main opposition party, the FMLN now faces the challenge 
of resolving its internal political differences or eventually seeing 
some of its factions reposition themselves as Social Democrats, perhaps 
in alliance with other left-of-ARENA parties.

Besides ARENA and the FMLN, other political parties in El Salvador also 
play important roles:  the PDC, which still has broad support throughout 
the country, winning more municipal elections in 1994 than did the FMLN; 
the PCN, created by the Salvadoran military and in decline but allied 
with ARENA in the assembly; the CD, allied with the FMLN in the 
assembly; and the MU, a party based in the Salvadoran evangelical 
movement.

Labor unions, the universities, and the Catholic Church play major roles 
in the Salvadoran political system.  Two main labor umbrella groups 
represent most of El Salvador's 300,000 organized workers. The 
Democratic National Union of Peasants and Workers (UNOC) represents some 
250,000 workers, and its leadership is closely linked to the PDC.  The 
National Union of Salvadoran Workers (UNTS) represents about 55,000 
workers and other supporters.  Four members of the UNTS executive 
committee were among the official founders of the FMLN political party, 
and the UNTS usually hews to the FMLN line in political matters.

The national University of El Salvador (UES) has also been heavily 
influenced by the FMLN.  UES was closed by the military from 1980 until 
1984, when it was reopened by President Duarte; it also was closed for 
several months in the aftermath of the November 1989 offensive.  A 
number of private universities, including the Jesuit-run University of 
Central America, also operate in El Salvador.

Since the late 1970s, when Archbishop Romero (assassinated in 1980) 
called for an end to repression and for social justice, the Catholic 
Church has been a vocal and aggressive advocate of peace.  The Church 
mediated a 1984 dialogue between the government and the guerrillas and 
the release of then-President Duarte's daughter, whom the guerrillas had 
abducted.

Compliance With the Peace Accords

The peace process set up under the Chapultepec Accords has been 
monitored by the UN Mission to El Salvador, known by its Spanish acronym 
ONUSAL.  The mission's observers were divided into four contingents--
monitoring human rights, military, police, and electoral issues.  At its 
peak, ONUSAL had close to 1,000 observers in the country.  A reduced 
ONUSAL presence has been authorized through November 1994.

The peace accords included a two-year timetable to complete different 
aspects of the agreement (see box for some key provisions of the 
accords); progress has been made in carrying out most aspects of the 
peace accords.

Human Rights.  During the 12-year civil war, human rights violations by 
both left- and right-wing forces were rampant.  There were incidents of 
political killings, torture of detainees, arbitrary arrest, and forced 
recruitment by the ESAF.  There were also cases of killings, kidnapings, 
abuse of non-combatants, intimidation of civilians, and forced 
recruitment by the FMLN.  Right-wing death squads took advantage of this 
chaotic environment to engage in political assassinations.  Many 
individuals and institutions acted with virtual impunity from a judicial 
system burdened with corruption and overwhelmed by the magnitude of the 
bloodshed.

The 1992 peace accords established a Truth Commission under UN auspices 
to investigate the most serious cases of human rights abuses committed 
during the civil war.  The commission reported its findings on prominent 
human rights cases on March 15, 1993.  It recommended removal from all 
government and military posts of those identified as human rights 
violators and recommended reforms of the Salvadoran judiciary.  On March 
20, the Legislative Assembly approved amnesty from criminal prosecution 
for all those implicated in the Truth Commission report.  Among those 
freed from jail as a result were the ESAF officers convicted in the 1989 
Jesuit murders and the FMLN ex-combatants who were being held for the 
1991 killings of two U.S. servicemen.

The peace accords also required the establishment of an Ad Hoc 
Commission to evaluate the human rights record, professional competence, 
and commitment to democracy of the ESAF officer corps.  On June 30, 
1993, the last of 103 officers identified by this commission as 
responsible for human rights violations were removed from active duty in 
the ESAF, and they were formally retired at the end of December.  ONUSAL 
declared the government in compliance with the Ad Hoc Commission 
recommendations.

There has been a dramatic decline in political killings since the 
signing of the peace accords in January 1992, but common crime presents 
a growing problem.  The frequent inability of the police and judicial 
authorities to resolve criminal cases has often left unanswered whether 
some killings may have been politically motivated.  In December 1993, a 
United Nations-Government of El Salvador Joint Group was established to 
investigate whether illegal, armed, politically motivated groups 
continued to exist in El Salvador after January 1992.

The Joint Group reported its findings on July 28, 1994.  It found that 
some groups and persons in El Salvador continue to resort to the use of 
violence in order to obtain political results.  It did not, however, 
find that war-era death squads were still functioning, instead 
suggesting that there had been an evolution from politically motivated 
death squads to organized crime groups.  The Joint Group recommended 
that a special unit be created in the National Civilian Police (PNC) to 
investigate political and organized crime and that further reforms be 
made in the judicial system and the ESAF.  The Calderon Sol 
administration has promised to carry out the Joint Group's 
recommendations.

The peace accords also established the autonomous Human Rights 
Ombudsman's Office, which had established regional offices in most of El 
Salvador's departments by September 1994.  The ombudsman's office is 
scheduled to assume all of the responsibilities of ONUSAL's human rights 
division by late 1994.

Military Reform.  Demobilization of Salvadoran military forces generally 
proceeded on schedule throughout the process.  The Treasury Police and 
National Guard were abolished, and the intelligence service was 
transferred to civilian control.  By February 1993, the military had 
lowered force levels from a wartime high of 63,000 to the level of 
32,000 required in the peace accords; this was achieved nine months 
ahead of schedule.  As noted, the required purge of military officers 
accused of human rights abuses and corruption was completed at the end 
of 1993 in compliance with the Ad Hoc Commission's recommendations.

National Civilian Police.  The new civilian police force, created to 
replace the several discredited former public security forces, was 
deployed in all departments by the end of 1994, but it is not expected 
to reach its required force levels until late 1995.  The old National 
Police, the only former police force still in existence, is scheduled to 
be completely demobilized by the end of 1994.

Judiciary.  In July 1994, a new Supreme Court was unanimously elected by 
the assembly after protracted negotiations.  No members of the old court 
were returned to office, belatedly fulfilling the recommendation of the 
Truth Commission that the entire Supreme Court leave office.

Land Transfers.  Land transfers have taken place more slowly than 
expected.  There have been difficulties in a number of areas, such as 
getting enough funding to purchase from private owners the lands to be 
used in the transfer program and securing enough funding for 
agricultural credits for the land recipients.  Despite this, significant 
progress has been made.  Thousands of families have received land and 
agricultural credits.  The international community, the Salvadoran 
Government, the former rebels, and the various financial institutions 
involved in the process continue to work closely together to bring the 
process to a successful conclusion.

Principal Government Officials
President--Armando Calderon Sol
Vice President--Enrique Borgo Bustamante
Minister of Foreign Relations--Oscar Alfredo Santamaria
Ambassador to the United States--Ana Cristina Sol
Representative to the OAS--Jose Roberto Andino Salazar
Representative to the UN--Ricardo Guillermo Castaneda Cornejo

El Salvador maintains an embassy in the United States at 2308 California 
Street NW, Washington, DC  20008 (tel. 202-265-9671).  There are 
consulates in Chicago, Houston, Los Angeles, Miami, New Orleans, New 
York, and San Francisco.


ECONOMY

The Salvadoran economy continues to reap the benefits of sound economic 
programs, a commitment to a free economy, and careful fiscal management.  
The impact of the civil war on El Salvador's economy was devastating; 
from 1979 to 1990, losses from damage to infrastructure and means of 
production due to guerrilla sabotage as well as from reduced export 
earnings totaled about $2.2 billion.  But since attacks on economic 
targets ended in 1992, improved investor confidence has led to increased 
private investment.  Rich soil, moderate climate, and a hard-working and 
enterprising labor pool comprise El Salvador's greatest assets.

Much of the improvement in El Salvador's economy is due to free market 
policy initiatives launched by the Cristiani government in July 1989.  
Reforms included:

--  Elimination of price controls on 240 consumer products;

--  Breakup of government and government-sanctioned monopolies over the 
export of coffee, sugar, and cotton;

--  Reduction of import duties;

--  Elimination of non-tariff barriers;

--  Adoption of a free-market exchange rate system;

--  Maintenance of positive real interest rates; and

--  Reduction of the fiscal deficit.

In July 1992, after a long political struggle, the Legislative Assembly 
passed a law establishing a 10% value added tax.  This year, the 
government essentially has completed its privatization of the banking 
system and passed a law detailing the operations of the already 
functioning stock market; it soon will establish a commodities market.  
The Calderon Sol administration also is committed to privatizing 
telecommunications and port services and to expanding transportation 
infrastructure.

In 1993, the service and construction sectors led El Salvador's economy 
to a real GDP growth rate of 5%, and GDP ended at $7.62 billion for the 
year.  Disappointing agricultural performance, however, slightly 
dampened the overall recovery; the contribution of coffee to the 
economy--30% of agricultural output--fell in 1993 because of decreased 
yields.  Inflation was 12% in 1993, down from 20% the year before.  The 
economic outlook for 1994 is for growth of 5.5%, with inflation dropping 
to 10%.  Income from coffee is expected to recover in 1994 due to six-
year highs in international prices.

In mid-1994, the nation had net international reserves of $840 million, 
equal to roughly four months of imports.  This compares to $650 million 
at the end of 1993.  The exchange rate--officially described as free-
floating and determined by the market--has remained at about 8.7 colones 
per U.S. dollar since early 1993.

Foreign Debt and Assistance

During the civil war, international lending institutions were reluctant 
to make loans to El Salvador, so the country never acquired a large 
international debt.  Since the war, El Salvador has continued to pursue 
a conservative debt posture.  Most of its roughly $1.8 billion debt is 
to multilateral lending institutions.

Since 1990, the Salvadoran Government's economic program has received 
strong support from international financial institutions and other 
lenders.  In 1993, the International Monetary Fund approved a 12-month 
standby agreement which paved the way for a rescheduling of $135 million 
of El Salvador's Paris Club debt to official creditors.  The World Bank 
approved a $75-million structural adjustment loan.  In December 1992, 
the U.S. Government reduced bilateral debt with El Salvador by 75%--from 
$617 million to $151 million--under provisions of the Enterprise for the 
Americas Initiative.

Foreign assistance plays an important role in the Salvadoran economy, 
helping to finance the balance-of-payments gap and providing funds to 
the capital budget for public sector infrastructure-development 
projects.  At a March 1993 meeting held in Paris, the international 
community pledged $800 million in loans and donations for reconstruction 
in El Salvador.

Manufacturing

El Salvador historically has been the most industrialized nation in 
Central America, though a decade of war eroded this position.  In 1993, 
manufacturing accounted for 19% of GDP and employed 19% of the work 
force.  Based primarily in the capital city of San Salvador, the 
industrial sector is oriented largely toward domestic and Central 
American markets.  Textiles, footwear and clothing, beverages, processed 
food, tobacco, wood and metal products, and chemical products are the 
principal manufactured goods.

Trade

In 1993, El Salvador's total exports were $732 million, while imports 
were $1.9 billion, resulting in a trade deficit of more then $1 billion.  
This deficit was offset by family remittances of almost $800 million 
sent by the more than 1 million Salvadorans living in the U.S., plus 
generous amounts of bilateral aid and loans from multilateral lending 
organizations.  Twenty-five percent of El Salvador's imports were 
machinery and equipment destined to upgrade the nation's private sector.  
Recently, El Salvador's development efforts have focused on non-
traditional agricultural exports.

In 1991, El Salvador became a member of the General Agreement on Tariffs 
and Trade (GATT).  Also that year, El Salvador and its Central American 
neighbors announced their interest in negotiating a regional free-trade 
agreement to complement the Central American Common Market (CACM) and 
the Central American Integration System (SICA).  As a result, steps have 
been made toward Central American economic integration.  In March 1992, 
El Salvador and Guatemala signed a free trade agreement calling for 
common external tariff and export tax systems; negotiations on similar 
agreements with Honduras have been conducted.  Talks to negotiate a 
free-trade agreement between Mexico and El Salvador, Guatemala, and 
Honduras are scheduled to begin in late 1994.

Agriculture and Land Reform

Before 1980, a small economic elite owned most of the land in El 
Salvador and controlled a highly successful agricultural industry. About 
70% of farmers were sharecroppers or laborers on large plantations.  
Many farm workers were under- or unemployed and impoverished.

The civilian-military junta which came to power in 1979 instituted an 
ambitious land reform program to redress the inequities of the past, 
respond to the legitimate grievances of the rural poor, and promote more 
broadly based growth in the agricultural sector.  The ultimate goal was 
to develop a rural middle class with a stake in a peaceful and 
prosperous future for El Salvador.

At least 525,000 people--more than 12% of El Salvador's population at 
the time and perhaps 25% of the rural poor--benefited from agrarian 
reform, and more than 22% of El Salvador's total farmland was 
transferred to those who previously worked the land but did not own it.  
But when agrarian reform ended in 1990, about 150,000 landless families 
still had not benefited from the reform actions.

The 1992 peace accords make provisions for land transfers to all 
qualified ex-combatants of both the FMLN and ESAF, as well as to 
landless peasants living in former conflict areas.  While strongly 
opposed to new land expropriations, the Calderon Sol administration is 
committed to facilitating the voluntary transfer of land.  To date, more 
than 12,000 of these transactions have been financed through the U.S.-
assisted Land Bank and the Salvadoran Institute for Land Transformation.  
Up to 37,000 families could benefit from this land transfer program upon 
its completion, currently programmed for mid-1995.


FOREIGN RELATIONS

El Salvador is a member of the United Nations and several of its 
specialized agencies; the Organization of American States (OAS); the 
CACM; the Central American Parliament (PARLACEN); and the SICA.  It 
actively participates in the Central American Security Commission 
(CASC), which seeks to promote regional arms control.  As noted, El 
Salvador also is a member of GATT and is pursuing regional free trade 
agreements.  

In July 1969, El Salvador and Honduras fought the brief "Soccer War" 
over disputed border areas and friction resulting from the 300,000 
Salvadorans who had emigrated to Honduras in search of land and 
employment.  The catalyst was nationalistic feelings aroused by a series 
of soccer matches between the two countries.  In the course of the war, 
Salvadoran forces penetrated as far as 18 miles into Honduras.  The two 
countries formally signed a peace treaty on October 30, 1980, which put 
the border dispute before the International Court of Justice.  In 
September 1992, the court issued a 400-page ruling, awarding much of the 
disputed land to Honduras.  El Salvadoran-Honduran diplomatic relations 
now are normal, as are trade relations.

El Salvador has played a constructive and activist role in the 
Esquipulas process, the regional effort to promote peace in Central 
America.  The Government of El Salvador is firmly committed to a 
comprehensive agreement linking guarantees of security among the Central 
American countries to national reconciliation through democratization 
within each country.

El Salvador strongly backed efforts by the United States to implement UN 
Security Council Resolution 940, designed to facilitate the departure of 
Haiti's de facto authorities from power.


U.S.-SALVADORAN RELATIONS

U.S.-Salvadoran relations traditionally have been cordial and have 
become very close as a result of substantial U.S. aid in the 1980s as 
well as a growing population of Salvadorans in the United States.  U.S. 
policy toward El Salvador seeks to promote:


--  The complete implementation of the peace accords;

--  The strengthening of El Salvador's democratic institutions, rule of 
law, judicial reform, and civilian police;

--  National reconciliation and a complete end to political violence;

--  National reconstruction, economic opportunity, and growth; and

--  Support for the regional security objectives embodied in the 
Esquipulas II agreement.

In FY 1993, U.S. Government assistance to El Salvador was about $181 
million, including $30 million of PL-480.  The international community's 
March 1993 pledge of $800 million for reconstruction in El Salvador 
included $225 million in loans from the Inter-American Development Bank 
for electricity generation and private sector investment.  For FY 1994, 
total U.S. assistance was about $82 million, a reduction due to 
declining U.S. aid levels worldwide and increasing commitments to other 
countries.

Principal U.S. Embassy Officials
Ambassador--Alan H. Flanigan
Deputy Chief of Mission--Gwen Clare

The U.S. embassy in El Salvador is located at Final Blvd., Santa Elena, 
Antiguo Cuscatlan, San Salvador  (tel.:  503-278-4444; fax:  503-278-
6011). 

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