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El Salvador AGRICULTURE
Industry and agriculture were the most dynamic sectors of the
economy during the 1965-80 period, growing each year by 5.3
percent and 3.6 percent in real terms, respectively. Between 1980
and 1986, the value of agricultural output dropped by an average
2.3 percent per year. This decline was influenced by a number of
factors, among them guerrilla sabotage, the comparative
inefficiency of farms created by the land reform program, and the
ineffectiveness of many government policies. Despite the general
decline of agricultural output, coffee, which generated half the
country's export earnings in 1987, continued as the most
important commodity produced in El Salvador.
The agricultural sector accounted for nearly 25 percent of
GDP in 1987 and was responsible for about 80 percent of the
country's export revenue. Although the number of people employed
in agriculture increased from 3.5 million in 1970 to 5.7 million
in 1986, the share of the economically active population employed
in agriculture declined from 56 percent in 1970 to only 40
percent in 1986. After coffee, sugar and cotton were the most
important agricultural commodities. Basic grains (wheat, rice,
and corn) were also grown extensively, but for domestic
consumption.
Despite the relative importance of agriculture to El
Salvador's economy, absolute levels of production declined
dramatically after 1979. Several factors, especially the civil
conflict, were blamed for the decline. Guerrilla attacks on
farms, processing plants, and infrastructure undermined
efficiency, precluded investment, and intimidated laborers. The
impact of the conflict varied, however, depending on the crop.
For example, the geographical location of the most important
coffee-growing area--the western sector of the country--insulated
most coffee producers from the violence. In contrast, cotton
production, centered in the eastern part of the country, was
devastated by guerrilla activities.
Data as of November 1988
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