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<ul>
 <li><strong>El Salvador forecasts 3-4% economic growth in 2024, driven by public and private investments and export demand.</strong></li>
 <li><strong>Bitcoin’s integration into the economy is a fundamental element of President Bukele’s growth strategy.</strong></li>
</ul>
<p>El Salvador’s Central Bank (BCR) has projected an economic growth rate between 3% and 4% for 2024, largely <a href="https://www.ethnews.com/governments-shake-crypto-markets-with-massive-bitcoin-and-ethereum-transfers/" rel="noopener noreferrer nofollow">fueled by</a> public and private investments, and an increase in export demand. This forecast was disclosed by Douglas Rodríguez, the President of the BCR, who shared some economic data on June 27th.</p>
<h2 id="economic-growth-driven-by-investments-and-exports">Economic Growth Driven by Investments and Exports</h2>
<p>According to Rodríguez, El Salvador saw a growth of 2.6% in the first quarter of 2024, edging close to the 3% growth achieved over the entire previous year. The official anticipates inflation to range between 0.5% and 1%, <a href="https://www.ethnews.com/bukeles-bitcoin-promises-falter-el-salvadors-hopes-hang-in-the-balance/" rel="noopener noreferrer nofollow">influenced by</a> international oil prices and the diversification of El Salvador’s energy mix with renewable sources.</p>
<p>Rodríguez <a href="https://www.ethnews.com/bitcoin-bull-run-delayed-until-2025-insights-and-predictions/" rel="noopener noreferrer nofollow">emphasized</a> that the country is experiencing significant growth, surpassing the economic progress of the past three decades.</p>
<h2 id="the-silent-influence-of-bitcoin">The Silent Influence of Bitcoin</h2>
<p>In the backdrop of this economic surge, Bitcoin plays a crucial yet understated role. While Rodríguez did not explicitly credit <a href="https://www.ethnews.com/us-government-and-dormant-whale-stir-bitcoin-market-with-9-8-billion-yen-transfer-meta-title/" rel="noopener noreferrer nofollow">Bitcoin</a> for the growth, its influence is interwoven into various aspects of the country’s economic dynamics.</p>
<p>Nayib Bukele’s administration has centered its second term on economic enhancement, leveraging several tools, including <a href="https://www.ethnews.com/peter-schiffs-warning-are-bitcoin-etf-investors-at-risk-compared-to-gold/" rel="noopener noreferrer nofollow">Bitcoin</a>, to achieve its goals. Salvadoran Vice President Félix Ulloa highlighted that Bitcoin is one of the many tools at their disposal to drive economic growth.</p>
<p>The nation’s improved security, international events, and policies attracting private investments and tourism are pivotal, with <a href="https://www.ethnews.com/impact-of-decreasing-hash-rate-on-bitcoin-mining-challenges/" rel="noopener noreferrer nofollow">Bitcoin</a> significantly involved in these activities. This is evident from El Salvador’s status as the fastest-growing tourist destination in the Western Hemisphere, as reported by the World Tourism Organization.</p>
<h2 id="bitcoin-mining-and-economic-benefits">Bitcoin Mining and Economic Benefits</h2>
<p>Bitcoin mining emerges as a notable activity propelling growth. Pierre Rochard, Vice President of Research at Riot Platforms, underscored the benefits of <a href="https://www.ethnews.com/potential-market-movements-bitcoin-faces-short-squeeze-amid-rising-short-positions/" rel="noopener noreferrer nofollow">Bitcoin</a> mining for the energy sector. By establishing mining facilities, these companies help lower electricity prices, which is advantageous for both industrial and residential consumers.</p>
<p>A prime example is Volcano Energy, which plans to start mining in 2025 using its solar and wind power plants, initially generating 130 megawatts (MW) for <a href="https://www.ethnews.com/will-bitcoin-hold-60k-a-closer-look-as-options-expiry-looms/" rel="noopener noreferrer nofollow">Bitcoin</a> operations. This not only contributes to the local grid but also bolsters economic growth through affordable energy.</p>
<p>These developments reflect the integral role Bitcoin continues to play in El Salvador’s growth strategy, despite challenges and mixed public acceptance. President Bukele’s commitment to maintaining <a href="https://www.ethnews.com/market-trends-ethereum-and-bitcoin-funds-face-decline-amidst-economic-shifts/" rel="noopener noreferrer nofollow">Bitcoin</a> as legal tender remains firm, even amidst international pressures and critiques.</p>
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<p>The post <a href="https://www.ethnews.com/el-salvadors-economic-boom-the-role-of-bitcoin-in-a-4-growth-forecast/" rel="noopener noreferrer nofollow">El Salvador’s Economic Boom: The Role of Bitcoin in a 4% Growth Forecast</a> appeared first on <a href="https://www.ethnews.com" rel="noopener noreferrer nofollow">ETHNews</a>.</p>

El Salvador’s Economic Boom: The Role of Bitcoin in a 4% Growth Forecast

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