El Salvador links tourism boom to Bitcoin legalization

After the adoption of Bitcoin as a means of payment, the country’s tourist flux rose by 30%, according to Tourism Minister Morena Valdés.

Boom! 💥 💥 💥

El Salvador’s tourism has grown by 30% since the Bitcoin Lawhttps://t.co/i8t6JRHD1a#ElSalvador #BitcoinLaw #bitcoin #bitcoininvestment #Abtc #tourism #BitcoinCity #blockchain #investments

— Mónica Taher ⚡️🇸🇻 (@monicataher) February 22, 2022

The law legalising the first cryptocurrency took effect on September 7, 2021.

“We conducted a survey to check activity before and after [the adoption] of Bitcoin. The tourism sector grew by more than 30% in November and December,” said Valdés.

According to her, the recovery in the sector exceeded expectations, as the country welcomed 1.4 million visitors against a forecast of 1.1 million.

The introduction of cryptocurrency influenced the makeup of tourist flows. Whereas previously most tourists came from neighbouring Central American countries, now up to 60% come from the United States, the minister noted.

She also pointed to a rise in tourism revenues:

“We planned $0.8 billion in foreign currencies, and received $1.4 billion.”

Earlier, President Nayib Bukele announced that El Salvador’s GDP grew by 10.3% in 2021.

Exports were the main driver, rising 13%.

El Salvador’s GDP grew 10.3% in 2021.

And now its exports (a main driver of economic growth) grew 13% this January, compared to January 2021.

Are we looking at another double digit GDP growth this year?

By the way, El Salvador never had a double digit GDP growth before 2021. https://t.co/f9yMkPpLNJ

— Nayib Bukele 🇸🇻 (@nayibbukele) February 19, 2022

The IMF has repeatedly criticised El Salvador’s move to legalise the cryptocurrency. In January, the organisation recommended that El Salvador strip Bitcoin of its status as legal tender.

In August 2021, Moody’s понизило El Salvador’s long-term foreign currency rating to Caa1 with a negative outlook. In early 2022, experts at the firm noted that purchases of Bitcoin by the government continue to exert pressure on the country’s creditworthiness.

However, El Salvador did not abandon plans to issue Bitcoin bonds worth $1 billion in partnership with Blockstream and iFinex. The debt offering is expected to take place in March.