El Salvador can follow Singapore’s lead and become a financial center in the Americas, according to Gabor Gurbacs, strategy adviser of investment management firm VanEck.
“I say often to portfolio managers and asset allocators that El Salvador has the potential to become the Singapore of the Americas,” Gurbacs explained in an Oct. 28 X (formerly Twitter) post.
Similar to what Singapore achieved in the late 1990s, Gurbacs expects new capital investment and immigration to be the main drivers behind El Salvador’s increased economic growth over the next few years.
His comments come in response to an Oct. 28 post by United States broadcaster and Bitcoiner Max Keiser, which was captioned “Move to #ElSalvador, The New Land of the Free.”
Keiser, who now lives in El Salvador, listed Bitcoin (BTC) and the U.S. dollar’s legal tender status, a clean-up of Salvadoran crime, great beaches and great coffee as some of the main reasons the Central American country should be on everyone’s radar.
I say often to portfolio managers and asset allocators that El Salvador has the potential to become the Singapore of the Americas. I expect continued increase in immigration to, capital investment in and overall growth in El Salvador. https://t.co/CmT554x12j
— Gabor Gurbacs (@gaborgurbacs) October 28, 2023
El Salvador’s status as an emerging economy became more prominent when Nayib Bukele was elected as the country’s president in June 2019.
El Salvador’s sovereign bonds have outperformed many other emerging markets this year, yielding an eye-popping 70% return by August. It even caught the attention of JPMorgan and other large investment banks.
The FIAT guys at @jpmorgan say El Salvador is finally “getting some credit”.
They are just catching up.
It will soon be: “Salvadoran bonds are now Investment Grade”.
You’ll see pic.twitter.com/6Z1r7iS9M4
— Nayib Bukele (@nayibbukele) May 9, 2023
Bukele and the El Salvador government made Bitcoin legal tender in September 2021 and rolled out a Bitcoin custodial wallet, Chivo Wallet, for all Salvadorans in the same week.
El Salvador is also tapping into its volcanic resources to power a Bitcoin mining operation startup, Volcano Energy, which launched in June after a $1 billion investment. Keiser serves as the company’s executive chairman.
Its first mining pool was launched following a partnership with Bitcoin miners Luxor Technology in October.
Related: El Salvador’s Bitcoin strategy evolved with the bear market in 2022
El Salvador appointed Saifedean Ammous, author of The Bitcoin Standard as an economic advisor to the National Bitcoin Office in May. The country plans to accumulate Bitcoin as a strategy to clean out its debt within the next five years.
Bukele also made a bold move to eliminate all taxes on technology innovations in April, which could entice more entrepreneurs and foreign capital to move into the country.
Magazine: What it’s actually like to use Bitcoin in El Salvador
