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Science, Technology & Innovation Policy Review : El Salvador

Report by Miroux, Anne, Hamdi, Mongi, Pérez Cusó, Marta, Hernández, René, López Martínez, Roberto, Huidobro, Eduardo, 2011

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This review is intended to be a tool for learning and reflection, not a rating mechanism but an analytical tool that examines a series of proposals from a neutral external viewpoint. The ultimate objective of the science, technology and innovation policy review of El Salvador is to provide the Salvadorian Government with an up-to-date diagnostic analysis of the effectiveness of its science, technology and innovation-related policies and measures, and strengthen these policies and measures by integrating them in the national development process. It also seeks to improve technological capacity, encourage innovation and incorporate greater added value into production processes.



Science, Technology &
Innovation Policy Review


El Salvador


U n i t e d n at i o n s C o n f e r e n C e
o n t r a d e a n d d e v e l o p m e n t


New York and Geneva, 2011


e C o n o m i C C o m m i s s i o n f o r
l at i n a m e r i C a a n d t H e C a r i B B e a n




ii Science, Technology and Innovation Policy Review - El Salvador


UNCTAD/DTL/STICT/2011/4
Copyright © United Nations, 2011


All rights reserved. Printed in Switzerland




iiiPREFACE


PREFACE


The purpose of UNCTAD’s science, technology and innovation policy reviews is to assist governments in
developing their national capacities in science, technology and innovation, so that national science, technology
and innovation plans and programmes support the various components of the national development agenda
and help the productive sectors to compete in a knowledge-based global economy, generating better paid jobs,
raising living standards, reducing poverty and promoting a strategy of growth and commercial diversification.


This review is intended to be a tool for learning and reflection, not a rating mechanism but an analytical tool
that examines a series of proposals from a neutral external viewpoint. The ultimate objective of the science,
technology and innovation policy review of El Salvador is to provide the Salvadorian Government with an up-
to-date diagnostic analysis of the effectiveness of its science, technology and innovation-related policies and
measures, and strengthen these policies and measures by integrating them in the national development process.
It also seeks to improve technological capacity, encourage innovation and incorporate greater added value into
production processes.


The science, technology and innovation policy review of El Salvador was instigated at the request of the
Salvadorian Government and enjoyed the support of the Vice Ministry of Trade and Industry and the Vice Ministry
of Science and Technology. The review was conducted jointly by UNCTAD and ECLAC and forms part of a
proposal of technical cooperation to the Salvadorian Government.


The review was prepared by a team of experts under the direction of Anne Miroux, Director of the Technology
and Logistics Division of UNCTAD and under the direct supervision of Mongi Hamdi, Chief of the Science,
Technology and ICT Service (UNCTAD). Marta Pérez Cusó (UNCTAD) coordinated the review in collaboration
with René Hernández (ECLAC). Roberto López Martínez (national system of innovation) and Eduardo Huidobro
(agro-industrial sector) prepared reports which served as the basis for the review. The team of experts carried out
two missions in the field, in July 2010 and March 2011, and conducted over 50 interviews and two round tables
with representatives of government bodies, research institutes, universities, industry associations and chambers
of commerce, experts in science, technology and innovation, companies, non-governmental organizations and
international cooperation agencies. The national discussion workshop held on 29 March 2011 in San Salvador
permitted the gathering of comments on the first draft from a group of over 40 experts and national actors.


Kiyoshi Adachi, the Salvadorian Association of Computer Professionals (ASPROC), Néstor Bercovich, the
Salvadorian Chamber of Information and Communication Technologies (CASATIC), Quentin Dupriez, Reina
Durán de Alvarado, Ángel González Sanz and Jorge Patiño contributed invaluable material, comments and
suggestions. In addition, a great many people in El Salvador generously contributed their time and comments
in the preparation of this review. It is impossible to name them all, but the team responsible for this document
wishes to express its appreciation to all of them.


This review would not have been possible without the support of Mr Mario Cerna, Vice Minister of Trade and
Industry and Dr Erlinda Handal, Vice Minister of Science and Technology. The Directorate of Technological
Innovation, headed by Mr Yax Canossa and assisted by Mrs Verónica López and the National Directorate of
Science, Technology and Innovation, headed by Dr Alba María Orellana González were closely involved in the
review and deserve our since gratitude.


The evaluations and conclusions expressed in the review, however, are exclusively those of the UNCTAD
Secretariat and ECLAC.






vCONTENTS


CONTENTS


Preface ............................................................................................................................................... iii
Abbreviations .....................................................................................................................................xi


EXECUTIVE SUMMARY ....................................................................................................................... xiii


INTROdUCTION ..................................................................................................................................... xviii


ChAPTER I. GENERAl bACkGROUNd OF SCIENCE, TEChNOlOGY
ANd INNOVATION IN ThE ECONOMY OF El SAlVAdOR .............................. 1


A. Performance and evolution of the Salvadorian economy ................................................... 3
1. Macro-economic performance ............................................................................................................. 3
2. Structural conditions ............................................................................................................................. 8


B. Performance in science, technology and innovation in El Salvador ................................ 15
1. Inputs ................................................................................................................................................... 16
2. Results ................................................................................................................................................. 21
3. Innovation activities and their impact .................................................................................................. 23


ChAPTER II. ThE COMPONENTS OF ThE NATIONAl SYSTEM OF INNOVATION
OF El SAlVAdOR ..........................................................................................................25


A. Introduction .......................................................................................................................... 26


B. Governance of science, technology and innovation (STI).
Functions of cohesion and foresight – policy system ....................................................... 27
1. National Science, Technology and Innovation Policy, 2006–2030 ...................................................... 28
2. The Five-Year Development Plan, 2010–2014 (PQD) ......................................................................... 29
3. National Scientific and Technological Development Plan ................................................................... 30
4. The comprehensive export promotion strategy ................................................................................. 31


C. The administrative framework of science, technology and innovation.
Management, control and regulatory functions – link between the policy
system and the executing system ...................................................................................... 31
1. Presidency of the Republic ................................................................................................................ 31
2. Ministry of Agriculture and Livestock ................................................................................................. 31
3. Ministry of Economy ........................................................................................................................... 32
4. Ministry of Education .......................................................................................................................... 33
5. Laws and regulations .......................................................................................................................... 33


D. Operators in the system of innovation. Production and execution function –
executing system ................................................................................................................. 33
1. Industry ................................................................................................................................................ 33
2. Organizations which generate and disseminate knowledge ............................................................. 38
3. Support organizations ........................................................................................................................ 42
4. Financial system ................................................................................................................................. 43
5. Collaboration and links between agents ............................................................................................. 44


E. Principal instruments of innovation policy ......................................................................... 44
1. Direct financing measures ................................................................................................................. 44
2. Indirect regulatory measures ............................................................................................................. 46
3. Other direct measures ....................................................................................................................... 46
4. Catalytic financial measures .............................................................................................................. 46
5. Combined or mixed measures ........................................................................................................... 46
6. Other.................................................................................................................................................... 46




vi Science, Technology and Innovation Policy Review - El Salvador


ChAPTER III. El SAlVAdOR: A NATIONAl SYSTEM OF INNOVATION –
wORk IN PROGRESS. dIAGNOSTIC OF ThE SYSTEM ANd
PROPOSAlS FOR ITS dEVElOPMENT ................................................................47


A. General diagnostic .............................................................................................................. 48
1. Functions of cohesion and foresight .................................................................................................. 48
2. Management, control and regulatory functions ................................................................................. 49
3. Production and execution function .................................................................................................... 49


B. Strengthening the components and relationships of the Salvadorian
system of innovation .......................................................................................................... 50
1. Political and social conviction and commitment ................................................................................ 50
2. Direction and cohesion ...................................................................................................................... 51
3. Foresight and setting of priorities for research and development ..................................................... 51
4. Organizational structure and management ....................................................................................... 52
5. STI policy instruments ........................................................................................................................ 53


6. Education ........................................................................................................................................... 57


ChAPTER IV. INNOVATION IN ThE AGRO-INdUSTRIAl SECTOR .......................................61
A. Agro-industry in El Salvador ............................................................................................... 62


B. Diagnostic of the system of innovation in the agro-industrial sector .............................. 63
1. Production and execution function – executing system ................................................................... 63
2. Cohesion and foresight functions – policy system ............................................................................. 80
3. Management, control and regulation functions – link between the policy system


and the executing system ................................................................................................................... 81


C. Conclusions and recommendations ................................................................................... 85


ChAPTER V. INFORMATION ANd COMMUNICATION TEChNOlOGIES ..........................89
A. The global context of the ICT sector .................................................................................. 90


B. Diagnostic of the system of innovation in the ICT sector ................................................. 91
1. Production and execution function – executing system ................................................................... 91
2. Cohesion and foresight functions – policy system ........................................................................... 100
3. Management, control and regulation functions – link between the policy system


and the executing system ................................................................................................................. 102


C. Conclusions and recommendations ................................................................................. 106


ChAPTER VI. CONClUSIONS ANd RECOMMENdATIONS. A ROAd MAP FOR
STRENGThENING ThE SYSTEM OF INNOVATION OF El SAlVAdOR ....111


A. Conclusions and recommendations ................................................................................ 112


B. Road map for the strengthening of the system of innovation ........................................ 116


bIblIOGRAPhY .....................................................................................................................................119


ANNEXES ................................................................................................................................................125
Annex A. National science, technology and innovation policies ........................................ 126
Annex B. Development and limitations of the national systems of innovation approach.


The concept of systems in the technological innovation literature ..................... 135
Annex C. Regional systems of innovation (RSI) ................................................................... 136
Annex D. Patent analysis ....................................................................................................... 137
Annex E. Information on higher education institutions ........................................................ 144




vii


Annex F. Bibliometric study of Salvadorian scientific output .............................................. 146
Annex G. Provision of education at technical, higher education and postgraduate level


and R&D activities in ICT in educational institutions, El Salvador, 2011 ............ 157


Tables


ChapTer I
1. GDP growth and critical factors of growth in El Salvador, 1950-2009 ............................................................................................ 3
2. El Salvador in the Central American context, 2009 ......................................................................................................................... 3
3. Gross fixed capital formation, Central American countries, 2009 .................................................................................................. 4
4. El Salvador: selected economic indicators, 2004-2009 ................................................................................................................. 5
5. Exports and imports of El Salvador, 2009 (in millions of dollars).................................................................................................... 7
6. Balance of payments of El Salvador, 2004-2009 (millions of dollars)............................................................................................. 7
7. Real exchange rate, base 1993=100, 2004-2009 .......................................................................................................................... 8
8. Entrepreneurial structure by economic activity (economic census of 2005) ................................................................................ 10
9. The infrastructure of El Salvador, 2010 (ranking out of 139 countries) ......................................................................................... 11
10. Principal ICT infrastructure indicators, 2008 ............................................................................................................................... 11
11. Indicators of educational coverage and quality in Central America, 2008 ................................................................................. 12
12. Percentage of literate persons and average years of schooling, by geographical area and degree of poverty,


1992 and 2007 ............................................................................................................................................................................. 13
13. Rates of abandonment, repetition and over age pupils, 2003-2007 .......................................................................................... 14
14. Students in higher education by area of education and level of studies, 2009 .......................................................................... 15
15. Staff employed in R&D, full time equivalent and total actual persons, selected countries 2008 ............................................... 19
16. Staff employed in R&D per thousand employed persons, full time equivalent and total actual persons,


selected countries, 2008 .............................................................................................................................................................. 19
17. Academic staff by function and sex, 2009 .................................................................................................................................. 20
18. Academic staff and researchers by level of education, 2009 ..................................................................................................... 20


ChapTer II
1. Functions and dimensions of sustainable systems ...................................................................................................................... 26
2. Priority programmes and projects in the Five-Year Development Plan (millions of dollars) ......................................................... 30
3. National higher education indicators, 2008-2009 ......................................................................................................................... 41
4. Indicators of the World Economic Forum on competitiveness related to education.................................................................... 42


ChapTer III
1. STI policy mix matrix and approximation of its current use in El Salvador ................................................................................... 54


ChapTer IV
1. Agriculture and manufacturing, by branch of economic activity in millions of dollars (constant 1990 prices)


and as a percentage of GDP ........................................................................................................................................................ 62
2. Agricultural and agro-industrial exports of El Salvador (in millions of current dollars) ................................................................. 63
3. Number of establishments and jobs in Salvadorian agro-industry, according to the 2005 economic census............................ 67
4. Coffee exports, 2004 -2009 (thousands of quintals) .................................................................................................................... 68
5. Production of the fisheries and fish-farming sector, 2006 ............................................................................................................ 70
6. Exports of essential oils and balsam (2008-2010)(in thousands of dollars) ................................................................................ 73
7. Principal fruit exports, 2008-2010, in thousands of dollars ........................................................................................................... 74
8. Education in agro-industry related subjects, El Salvador, (2005-2009) ........................................................................................ 76
9. Agricultural research and development: El Salvador in the Central American context, 2006 ...................................................... 77
10. Budgets of the principal public institutions that participate in the promotion of agro-industry ................................................. 82
11. Principal strengths and weakness, opportunities and threats to innovation in the agro-industrial sector ................................. 85


ChapTer V
1. Percentage of the workforce considered as information workers(1) in Latin America ................................................................. 91
2. ICT penetration, selected Latin American countries, 2009 (per 100 inhabitants) ......................................................................... 92
3. Affordability of telecommunications, basket of prices, Central America, 2009 ............................................................................ 93
4. Households with Internet, fixed telephone and mobile telephone access in El Salvador, as percentage, 2009 ......................... 94
5. Internet users by place of use and type of activity (percentage of total users aged over 10 years), 2009 .................................. 95
6. Export of IT-enabled services in Latin America (millions of dollars), 2008 .................................................................................... 96
7. Trade in IT-enabled services (millions of dollars at current prices), El Salvador, 2000-2008 ........................................................ 97
8. Training in information technologies in El Salvador ...................................................................................................................... 99
9. R&D expenditure and personnel in exact and natural sciences and in engineering and technology, 2009 .............................. 100
10. Projects in the ICT area financed by FIES, 2008 and 2009 ...................................................................................................... 103
11. Principal strengths and weaknesses, opportunities and threats of the ICT sector .................................................................. 107


ChapTer VI
1. Principal strengths, weaknesses, opportunities and threats in the national system of innovation of El Salvador ..................... 113


CONTENTS




viii Science, Technology and Innovation Policy Review - El Salvador


annexes
A.1. National STI policy of El Salvador, 2006. Areas of knowledge for scientific and technological development


and innovation ......................................................................................................................................................................... 126
A.2. The National Research Agenda and its links to the Five-Year Development Plan (FDP) ........................................................ 128
A.3. Contents of the National Scientific and Technological Development Plan.............................................................................. 132
A.4. Integral Export Promotion Strategy .......................................................................................................................................... 133
D.1. Principal classes of patents registered (international classification), 1993–2010 ................................................................... 140
D.2. Principal countries of origin of holders of patents registered, 1993–2010 .............................................................................. 140
D.3. Principal holders of patents registered, 1993–2010 ................................................................................................................ 141
D.4. Principal classes of patents and principal patent holders, 2001–2010 .................................................................................. 142
D.5. Principal classes of patents and patent holders, 2001–2010 ................................................................................................. 143


FIgures


ChapTer I
1. Latin America and the Caribbean: annual GDP growth rate, 2009-2010 (as percentage) ............................................................ 2
2. GDP growth rates and trends, 1990-2009 ...................................................................................................................................... 4
3. Trends in exports of goods, based on their technological intensity, El Salvador, 2000-2009


(in thousands of dollars) ................................................................................................................................................................. 6
4. Import trends, El Salvador, 2006-2010, (in thousands of dollars) .................................................................................................. 6
5. Inflows of foreign direct investment, Central American countries, 1995-2009 (millions of dollars) ................................................ 8
6. Structure of the Salvadorian economy, 1990 -2009 (as percentage of GDP) ................................................................................ 9
7. Manufacturing industry in El Salvador, 1990 -2009......................................................................................................................... 9
8. Principal activities in the agricultural sector, El Salvador .............................................................................................................. 10
9. Competitiveness of El Salvador, 2010-2011 ................................................................................................................................. 12
10. Net school enrolment rates, by level of education, 2000 and 2007 (percentages) .................................................................... 14
11. R&D expenditure in El Salvador and other Latin American countries, 2008 (millions of PPP dollars) ....................................... 16
12. Comparative trends in R&D expenditure, El Salvador and selected Latin American countries, 2000-2008


(as percentage of GDP) .............................................................................................................................................................. 17
13. Investment in science and technology activities, 2007-2009 (in thousands of dollars) ............................................................. 17
14. R&D expenditure by source of financing, 2008-2009, (in thousands of dollars) ........................................................................ 18
15. Distribution of R&D expenditure by scientific and technological area, 2009 (as percentage) ................................................... 18
16. R&D expenditure by socio-economic objective, 2009 (in thousands of dollars) ....................................................................... 19
17. Expenditure on STA in El Salvador and other Latin American countries, 2008 (millions of PPP dollars) ................................... 20
18. Expenditure on STA by scientific and technological area, 2009 (as percentage) ...................................................................... 21
19. Expenditure on STA by socio-economic objective, 2009 (thousands of dollars) ....................................................................... 21
20. Royalties and licence fees (payments and receipts), various Latin American countries, 1995-2008


(in millions of dollars at current prices and current exchange rate) ........................................................................................... 23


ChapTer II
1. The principal government bodies involved in the system of innovation policies ......................................................................... 27
2. Global framework of the National STI Policy, 2006 ....................................................................................................................... 29
3. Priority programmes and projects in the Five-Year Development Plan by strategic area (percentage)....................................... 30
4. The principal government bodies involved in the management, control and regulation systems ............................................... 32
5. The principal agents involved in the system of execution and production................................................................................... 34
6. Ratio of receipts and payments for royalties and licensing of technology ................................................................................... 35
7. High technology exports (logarithmic scale) ................................................................................................................................ 36
8. Indicators of innovation under the World Banks’s Knowledge Assessment Methodology (KAM) ............................................... 37
9. Inconsistencies between the number of researchers and investment in R&D by subject area – Higher education


institutions, El Salvador, 2009 ....................................................................................................................................................... 38
10. Education indicators in accordance with the World Bank’s Knowledge Assessment Methodology (KAM) .............................. 41
11. Range of collaboration activities and linkages ........................................................................................................................... 45
12. Environmental conditions for the operation of STI policy instruments ....................................................................................... 45


ChapTer IV
1. The principal agents involved in the system of execution and production................................................................................... 64
2. Cultivated area, production and yields of maize, 2005-2011 ....................................................................................................... 71
3. Cultivated area, production and yield of beans, 2005-2011 ......................................................................................................... 71
4. The principal bodies involved in innovation policies in the agro-industrial sector ....................................................................... 81
5. The principal government bodies involved in the management, control and regulation systems ............................................... 83


ChapTer V
1. Importance of ICT in international trade, countries of Central America, 2009 .............................................................................. 96
2. Initiatives of the Government of El Salvador to create an information and knowledge society ................................................. 101
3. The principal government bodies involved in the system of ICT policies ................................................................................... 101
4. The principal government bodies involved in the ICT management, control and regulation systems ...................................... 102




ix


ChapTer VI
1. Road map for the strengthening of the system of innovation of El Salvador ............................................................................. 117


annexes
D.1. Ratio of the annual average patents granted to residents and total patents granted in Central American countries


and certain Latin American countries, 2000-2008 (logarithmic scale) .................................................................................... 137
D.2. Ratio of the average patents granted annually to non-residents and residents in Central American countries


and certain Latin American countries, 2000-2008 (logarithmic scale) .................................................................................... 137
D.3. Trends in coefficients of invention of Central American countries and certain Latin American economies, 1999-2008 ........ 138
D.4. Number of patents with at least one inventor resident in El Salvador, 1993-2010 .................................................................. 139
D.5. Distribution of patents by country of residence of primary inventor, 1993-2010 ..................................................................... 139
D.6. Distribution of patents by country of residence of primary owner, 1993-2010 ........................................................................ 139
E.1 Sources of financing and budget allocation ............................................................................................................................. 144
E.2. Proportion of academic grades among teaching staff ............................................................................................................ 144
E.3. Student-teacher ratio ............................................................................................................................................................... 145
E.4. Ratio of research staff, by adademic level, to total teaching staff........................................................................................... 145
F.1. Example of a network ............................................................................................................................................................... 147
F.2. Total number of publications by nationality of primary author, 1991-2010 ............................................................................... 148
F.3. Comparison of scientific output in Central America and certain Latin American countries, 2000-2010


(x-axis on logarithmic scale) ..................................................................................................................................................... 148
F.4. Distribution of scientific and humanist output in Central America and certain Latin American countries, 2000-2010 ............ 149
F.5. Expenditure on scientific and techological research and development by area of knowledge, 2009 .................................... 149
F.6. Patterns of publications of articles whose primary author resides in El Salvador and the United States


and annual impact factor, 1981-2010 ....................................................................................................................................... 150
F.7. Network of collaboration between authors by country of residence ........................................................................................ 150
F.8. Research patterns based on co-occurrence of subject categories, considering totality of articles........................................ 151
F.9. Principal subject categories ranked by number of publications (including impact factor)...................................................... 152
F.10. Principal subject categories ranked by impact factor (including number of publications).................................................... 153
F.11. Subject categories ranked by number of publications when the primary author resides in El Salvador


(including impact factor) ......................................................................................................................................................... 154
F.12. Subject categories ranked impact factor when the primary author resides in El Salvador


(including number of publications ) ........................................................................................................................................ 155
F.13. Research bodies with the greatest number of publications (including impact factor) .......................................................... 155
F.14. Research bodies with the greatest impact factor (including number of publications) .......................................................... 156
F.15. Output of scientific articles with international visibility, 1940-2010 ......................................................................................... 156


bOx


ChapTer II
1. Examples of successful innovations in El Salvador not captured by national indicators ............................................................. 37
2. Contrasting aspects of research in El Salvador ............................................................................................................................ 40


ChapTer III
1. Good practices in the use of STI policy instruments ..............................................................................................................55-56


ChapTer IV
1. The experience of innovative Salvadorian agro-industrial enterprises ....................................................................................66-67


ChapTer V
1. Examples of Salvadorian potential in ICT and ICT-based services .............................................................................................. 98
2. Salvadorian legislation on ICT .............................................................................................................................................. 105-106


annexes
A.1. Principal lines of the Five-Year Development Plan relating to STI ........................................................................................... 127


CONTENTS






xiABBREVIATIONS


AbbREVIATIONS


AFIS: Support and training in internationalization of Salvadorian companies
ASI: Salvadorian Association of Industrialists
AVES: Association of Poultry Farmers of El Salvador
BFA: Agricultural Promotion Bank
BH: Mortgage Bank
BMI: Multisectoral Investment Bank
CAMAGRO: Agricultural and Agro-industrial Chamber of El Salvador
CAMARASAL: Chamber of Commerce and Industry of El Salvador
CDB: Convention on Biological Diversity
CENDEPESCA: Centre for Fisheries and Aquaculture Development
CENSALUD: Centre for Research and Development in Health
CENTA: National Centre for Agricultural and Forestry Technology
CICES: National Centre for Scientific Research of El Salvador
CIMMYT: International Maize and Wheat Improvement Centre
CNR: National Records Centre
CONACYT: National Council for Science and Technology
CONAMYPE: National Commission for Micro and Small Enterprises
CORSAIN: Salvadorian Investment Corporation
DCP: Directorate of Quality and Productivity
DIDT: Directorate of Innovation and Technological Development
DIGESTYC: Directorate General of Statistics and Censuses
ECLAC: Economic Commission for Latin America and the Caribbean
ENA: National School of Agriculture
FANTEL: Special Fund of resources from the privatization of ANTEL
(National Telecommunication Administration)
FAO: United Nations Food and Agriculture Organization
FDI: Foreign Direct Investment
FEDA: Special Trust for Agricultural Development
FIAGRO: Foundation for agricultural technological innovation
FIES: Higher Education Research Fund
FODECYT: Fund for Scientific, Technological Development and Innovation
FOEX- FONDEPRO: Productive Export Development Fund
FOMILENIO: Millennium Fund
FOMIN: Multilateral Investment Fund
FUNDE: National Development Foundation
FUSADES: Salvadorian Foundation for Economic and Social Development
GDP: Gross Domestic Product
GPI: Group for the Promotion of Innovation
IADB: Inter-American Development Bank
ICT: Information and Communication Technologies
IES: Higher Education Institutions
IICA: Inter-American Institute for Cooperation on Agriculture
INSAFORP: Salvadorian Institute for Professional Training
ISEADE: Higher Institute of Economics and Business Management
IT: Information technology
ITCA-FEPADE: Central American Technological Institute
JICA: Japan International Cooperation Agency
KAM: Knowledge assessment methodology




xii Science, Technology and Innovation Policy Review - El Salvador


LDCyT: Scientific and Technological Development Act
MCC: Millennium Challenge Corporation
MEGATEC: Technical and Technological Gradual Learning Education Model
MINAG: Ministry of Agriculture and Livestock
MINEC: Ministry of Economy
MINED: Ministry of Education
MSMEs: Micro, small and medium-sized enterprises
MSEs: Micro and small enterprises
NSI: National System of Innovation
OECD: Organization for Economic Cooperation and Development
PAES: Secondary school leaving certificate of education and aptitudes
PAESITA: Assessment of learning achievements in primary education
PDP: Productive development project
PPP: Purchasing Power Parity
PQD: Five-Year Development Plan
PROCAFÉ: Salvadorian Foundation for Coffee Research
PROESA- EXPORTA: Export and Investment Promotion Agency
R&D: Research and Development
REDISAL: Network of Salvadorian Researchers
RICYT: Network of Science and Technology Indicators - Ibero-American and Inter-American
RREE: Ministry of Foreign Relations
RSI: Regional System of Innovation
SIEPAC: Central American Electric Interconnection System
SIGET: General Superintendency of Electricity and Telecommunications
SINACTI: National System of Science, Technology and Innovation
SINALIT: System of Partnership for Agricultural and Forestry Technology
SSF: Superintendency of the Financial System
S&T: Science and technology
STA: Science and Technology Activities
STI: Science, technology and innovation
UASA: Autonomous University of Santa Ana
UCA: José Simeón Cañas Central American University
UDB: Don Bosco University
UES: University of El Salvador
UJMD: Dr José Matías Delgado University
UNCTAD: United Nations Conference on Trade and Development
UNDP: United Nations Development Programme
UNESCO: United Nations Educational, Science and Cultural Organization
UNICAES: Catholic University of El Salvador
UNSD: United Nations Statistics Division
UO: Oriente University
USAM: Alberto Masferrer University
USPTO: United States Patent and Trademark Office
UTEC: Technological University
WEF: World Economic Forum
WIPO: World Intellectual Property Organization
WOS: World of Science
WTO: World Trade Organization




xiiiEXECUTIVE SUMMARY


EXECUTIVE SUMMARY
El Salvador, a small and open economy, poorly endowed with natural resources, needs to base its growth on
increased productivity and economic transformation towards activities with a higher added value.


In order to bring about this transformation, the country must focus on developing its own capacities to adopt,
use, adapt and generate knowledge. This requires, firstly, investment (both public and private) in knowledge-
generating activities and innovation, and, secondly, the strengthening of a national system of innovation which
fosters and facilitates these activities and their application in the productive sectors.


There are signs that various efforts have been made in El Salvador, often against a difficult background of
scarce resources, to encourage the development of these capacities. Among other things, the Government of El
Salvador has invested in knowledge-generating activities and the promotion of a national system of innovation.


The country has various capacities in the sphere of science, technology and innovation which can serve as the
basis for progress and successful results. There is scientific research with international impact, especially in the
area of the health sciences. There are also the nuclei of good quality education. There are innovative companies,
for example in the agro-industrial and pharmaceutical sectors, and some positive experience of university-
company collaboration, for example, in the design of specific study programmes. There is interest in various
spheres in promoting science, technology and innovation, from various public institutions, non-governmental
organizations and international cooperation agencies. However, there is a general lack of interest on the part of
the private sector. Lastly, the bases of the legal framework are adequate so that they do not act as a brake on
innovative activities.


In addition, in El Salvador, there are a number of factors which offer opportunities for the development of
capacities in science, technology and innovation. The country has a good road and air transport system and
telecommunications infrastructure (especially mobile phones). There are also national programmes, such as the
port of La Unión or Fomilenio, which, given their resources and geographical localization, provide opportunities
for the development of technological capacities and innovation, particularly at the regional level. The strong
presence of Salvadorians abroad is a channel for access to valuable resources and knowledge. The diversification
of production offers opportunities for progress in many areas, such as the beverages and food industry or the
pharmaceutical sector, and the opening of trade is an incentive to innovation by increasing competition and by
facilitating the purchase of capital goods and access to new technologies. International cooperation makes an
important contribution to the development of innovation skills, and there are ample opportunities for greater
international collaboration in research and innovation. Lastly, there is broad and continuing agreement in the
country on the macro-economic stability policies and openness to the outside which encourages the private
sector (domestic and foreign) to have the confidence to invest in the country.


However, at present, El Salvador lacks adequate systemic conditions to develop capacities to adopt, use, adapt
and generate knowledge. There is no government body which provides cohesion and direction to policies
concerning STI. Neither is there an articulated system of STI policies, but rather isolated policies focused either
on science and technology or on innovation, industrial development or exports. No foresight exercise has
been carried out to identify research strengths and production capacities, and establish priorities from which
development programmes and policy instruments are derived. A lack of monitoring and evaluation of policies
and programmes to allow making the necessary adjustments was also observed.


As regards the generation of knowledge, the research sector is weak in human and financial resources, has little
private involvement and is heavily weighted towards the social sciences and humanities. Levels of investment
in R&D, both public and private, are extremely low. Furthermore, there is little contact between the knowledge
generating bodies and the productive sector and current research efforts have little impact on improvements in
production. The productive sector does not demand knowledge or technology, there is little awareness of the
utility of knowledge in generating value, there are few financing options and a limited number of innovation policy
instruments with limited budgets.




xiv Science, Technology and Innovation Policy Review - El Salvador


The education system suffers from serious weaknesses. Education in general, and higher education in particular,
has ample room for improvement, especially in terms of quality, the expansion of science and technology
teaching and research work.


In addition, the country must face the challenge of building STI capacities against a background of scarce public
resources. The weaknesses of public institutions, for example in the sphere of policy coordination, also represent
a threat to the development of these capacities which require broad agreement and clear and continuous
guidelines. The heterogeneous nature of business, where there is a large micro and small enterprise sector with
low productivity, will also determine the objectives which the country can achieve in STI. The consumption culture
acts as a disincentive to productive investment, and the rise in international competition, without greater capacity
for technological absorption, among other factors, will cause difficulties to Salvadorian companies. Lastly, the
cost of criminality, natural disasters and external shocks (such as the sharp increases in the price of oil or other
commodities or drastic reductions in remittances) and the country’s fragility in the face of these phenomena,
should not be overlooked.


The analysis of innovation in agro-industry and the information and communication technologies sector broadly
reaches conclusions similar to the observations on the national system of innovations. Among other things,
insufficient levels of investment in R&D were observed, scarcity of trained human resources, especially at
postgraduate level, the lack of a national programme to guide development and innovation in these sectors, and
a lack of links between institutions and the main stakeholders.


Based on the foregoing diagnostic, a series of recommendations are suggested focusing on five major pillars:


recommendation no. 1: establish an institutional and administrative, human and
financial framework able to lead and coordinate the development of sTI in el salvador
establish a regulatory body for science, technology and innovation with the responsibility of defining the major strategic
lines in STI, integrating STI in the national development strategy and monitoring and evaluation of policies. This
would include coordination of efforts to collect information on STI and the management of foresight activities.


This body must be given the authority, leadership and resources necessary to carry out its mission. Consequently,
it is proposed that it should be headed by the president of the republic, and composed of the Ministers of Economy,
Education and other ministries of particular relevance (Agriculture and Livestock, Health), as well as high-level
experienced representatives of the academic, productive and financial sectors. Given the cross-cutting nature
of this body, it would be logical for its secretariat to be included as part of the Technical Secretariat of the
Presidency. The implementation of the national policy would be in the hands of the respective ministries.


recommendation no. 2: Draw up a combination of sTI policies and programmes which,
linked to economic and education policy, will strengthen general sTI capacities
Based on the technological foresight survey and a process of consultation with the various key actors, identify 3
or 4 priority sectors and strategic technologies on which to focus active policies.


Establish a short-term national science, Technology and Innovation plan, with specific and measurable objectives,
clearly identified responsibilities and resources, and subject to a control system.


Increase public investment in sTI, and foster private investment in r&D and innovation by establishing incentives,
strengthening competitive funds for R&D and innovation, and developing a seed capital and venture capital
programme.


Promote sectoral and regional systems of innovation, promoting cooperation between agents and establishing
framework conditions to allow such cooperation.


Develop a science, technology and innovation information system which includes regular surveys of innovation and




xv


the use of ICT in enterprises, monitoring and evaluation of the various STI policies and programmes, and an STI
observatory which directs and disseminates the results of these activities.


recommendation no. 3: Invest in the development of salvadorian human capital
strengthen the national education system, by increasing public expenditure on education, strengthening quality
control of education, through accreditation and certification of institutions and programmes, and strengthening
the teaching of mathematics and the natural sciences.


Facilitate the provision of and access to high quality postgraduate education, in particular in the priority areas.
Increase the financial resources allocated to these studies, explore models which involve companies in the
financing of scholarships, strengthen bilateral cooperation with research centres and postgraduate training
centres.


update the training offered by the salvadorian Institute for professional Training (InsaFOrp) and strengthen its programme
management based on a consultation exercise with the private sector.


Establish a programme for repatriating and/or taking advantage of salvadorian talent abroad.


recommendation no. 4: strengthen entrepreneurial innovation
strengthen programmes of innovation and technology transfer by channelling financial resources for innovation
through the support bodies which have promoted it effectively, and establish sectoral technology centres1 linked
to productive activities with the participation of knowledge generating bodies.


Develop technological intelligence capacities.


Support the development of technology-based company incubators, establishing an incubation fund, promoting
the establishment of company incubators, and facilitating the development of venture and seed capital.


Include the development of technological capacities in the relevant national development programmes, such as
FOMILENIO or the management of the port of La Unión.


Establish a programme of promotion and training in the management of intellectual property, for example, in
universities and research centres. In the long term, contemplate the establishment of a separate body for the
management of intellectual property.


promote collaboration between universities, technological and specialized institutes and companies, by stimulating joint
development programmes between universities and companies, reviewing possible obstacles of a regulatory
character; include private sector participation in the design of STI policies and the formulation of study plans, and
establish an education and training programme on management and transfer of technology in higher education
institutions.


ensure that one of the cornerstones of the set of policies aimed at promoting structural transformation and productive
development (diversification of exports, strengthening productive chains, formation of productive agglomerations
and development of a national quality system), is the development of technological and innovation capacities.


recommendation no. 5: strengthen research capacities
Establish 4 or 5 research fellowships in the priority sectors, develop a mechanism for accreditation of the country’s
researchers, and, based on a national evaluation, draw up a plan to strengthen the research infrastructure.


The Review also makes a number of suggestions to promote innovation in the agro-industrial and information
and communications technology sectors, which are in line with the recommendations described above.


EXECUTIVE SUMMARY




xvi Science, Technology and Innovation Policy Review - El Salvador


In the agro-industrial area, it is proposed to:


1) Develop a national programme for the development of agro-industry, in the framework of a national system of
agricultural and agro-industrial innovation, establishing a joint working group on the promotion of innovation,
which supports the identification of two or three priority agro-industrial sectors, and develops the
configuration of a national system of agricultural and agro-industrial innovation.


2) strengthen the quality of education and training in the agricultural and agro-industrial sector, in particular, the priority
sectors or industries, reviewing education and training needs (students, teachers, extension workers and
companies), establishing a programme of scholarships and strengthening the capacities of the ENA.


3) support agricultural and agro-industrial research in universities, research centres and companies, increasing
public financing, establishing one or two research fellowships (at postgraduate level) in one or two agro-
industries, promoting the participation of agro-industrial companies in research activities, and strengthening
agricultural innovation and research by CENTA.


4) promote the expansion of innovation in the private sector, by, among other things, establishing two or three
local technological training and innovation centres, reviewing incentives for innovation, developing greater
provision of advanced technological services, promoting a culture of entrepreneurial cooperation and
innovation, developing the agro-industrial infrastructure, building capacity to adopt good agricultural
and manufacturing practices and to comply with sanitary and phytosanitary standards, preparing more
specialized technical and market studies for agro-industrial products, carrying out studies in the priority
agro-industries, and developing capacities in biosafety and biotechnology.


5) strengthen monitoring and evaluation of capacities, policies and programmes, consistent with the general
recommendations provided for the national system of innovation.


In the ICT area, it is suggested to:


1) Develop a national strategy for the development of the ICT sector, strengthening the productive aspects of the
eCountry Programme, and establishing a forum for dialogue between the education sector, public bodies
and representatives of the private sector. This strategy should focus on the following areas.


2) Improve the quality of education and training, through financial support for certification and accreditation
of persons, institutions and companies; promoting the updating of educational provision, establishing a
programme of scholarships, and reviewing the ICT training provided by INSAFORP.


3) support ICT research in universities and companies, by increasing financing of ICT research, and establishing
one or two research fellowships in ICT.


4) establish a set of measures to develop greater business sophistication in the sector. It is suggested, among
other things, to strengthen the mechanisms of incubation of technology-based companies, strengthen
the supply of services and capacities in competitive intelligence, foster the development of other sectors
which complement the development of technology-based companies (especially the content industry),
consolidate initiatives to support innovation in ICT undertaken by the Ministry of Economy, promote the
adoption of ICT by SMEs, promote more electronic government services, and facilitate the participation of
domestic companies in public procurement.


5) Collect information on innovation activities and areas of greatest potential and strengthen monitoring and evaluation
of capacities, policies and programmes, consistent with the general recommendations provided for the
national system of innovation.


6) Complete the current regulatory framework, in particular, facilitate the adoption of the bills on electronic
signatures and transactions, and data protection, and review possible obstacles in the regulatory
framework in order to strengthen the impact of public procurement on the development of the domestic
ICT industry.


This set of strategic recommendations should be implemented through commitment at the highest level and broad
dialogue with all the key stakeholders. The principal starting points will be the establishment of a regulatory body
for STI, the conduct of a technology foresight survey and the establishment of priority development areas.




xvii


Implementing these activities will require significant efforts and resources. In this regard, UNCTAD and ECLAC
are at the disposal of the Government of El Salvador, to the extent that resources are available, to continue
to support the development of these proposals through technical guidance, training and the promotion of
participatory processes, dialogue and sharing of experiences in the area of STI policies.


EXECUTIVE SUMMARY




xviii Science, Technology and Innovation Policy Review - El Salvador


INTROdUCTION


There is now broad agreement on the function of innovation as an engine of development and sustained economic
growth in the long term. The introduction of new products, process and organizational or marketing methods can
transform quantitatively and qualitatively the performance and structure of the economy and society as a whole
(ECLAC, 2010a, 2008). As Schumpeter maintains (1934), innovation is an authentic engine of development
which, by generating processes of “creative destruction”, is capable of promoting and maintaining prolonged
cycles of growth over time.


By innovation, we mean the implementation of a new or significantly improved product (good or service), or
process, a new marketing method or a new organizational method in business practices (OECD 2005). The
dimension of newness is measured in terms of whether the implementation is new for the firm or for the market.
Innovation thus includes the acquisition of knowledge and activities of imitation and adaptation, innovation
mechanisms which in developing countries are often more important than research and development activities
(R&D).2


Intrinsic qualitative and quantitative differences between productive sectors and activities exist. There are
activities which are considered “positive” for growth in the long term (those which are knowledge intensive),
as they generate externalities, processes of technological shift and incentives to innovation and learning which
support the accumulation of technological capacities in the long term (ECLAC 2010a, UNCTAD 2007).


It is also found that knowledge and technology act as a catalyst in development processes and the specific
characteristics of knowledge and the generation and dissemination of knowledge justifies the intervention of the
State.


On the one hand, there is a need to correct various market failures, such as uncertainty, transaction costs,
difficulties in diversifying risk, information imbalances, or the lack of knowledge appropriability3. These are a
disincentive to private investment in knowledge generation, resulting in levels of investment below the social
optimum.


On the other, knowledge has tacit elements and its appropriation by companies, individuals and organizations
depends not only on the acquisition of machinery or the transfer of a set of instructions, but also on the acquired
technological capacities, i.e. knowing how to do and knowing how to learn. Tacit knowledge is generated in
specific contexts, based on practice, interaction and learning over time, and it is not transferable. For these
reasons, the necessary conditions must be created to allow these interactions and learning to occur, and to
develop capacities to absorb technology. The institutional framework influences the capacity of the actors to
interact and learn, and thus it conditions the possibilities of generating and using knowledge. This framework
conditions, for example, the possible alignment of the needs of knowledge users (i.e. the productive sector)
and the activities of knowledge-generating organizations (e.g. universities, public research institutes). This
institutional framework, i.e. the set of institutions which interact and complement each other in the creation and
dissemination of new technologies and which make up the policy agenda implementation of those policies by
governments, is a way of defining what is generally called a National System of Innovation (Metcalfe 1995).


It should be noted that economic openness, and the processes of specialization and growing participation in the
international production chains which accompany this openness, do not guarantee the possibility of benefiting
from the indirect dissemination of technology. On the contrary, in open economies, knowledge seems more a
good reserved for certain groups (club good), non-rivalrous but subject to exclusion with respect to consumption.
Position in the value chain determines the capacity to use that good (Cimoli, Ferraz and Primi, 2007). For example,
access to capital goods and technology licences have been powerful sources of technological modernization,
but have been confined to large, leading companies and have not spread to the rest of the productive system.


Given these characteristics and conditions, a series of coordinated and coherent policies or policy mix are needed
to correct the various market and systemic failures, stimulate the development of capacities for assimilation
and facilitate the participation of the national productive system in the global economy. Cross-cutting policies




xix


are needed which address market failures and information imbalances, promote training, facilitate the general
dissemination and assimilation of knowledge, and allow companies to improve their current position within
the limits of their possibilities of innovation. Vertical and selective policies are also needed to support specific
sectors and technologies, encourage cooperation and articulation between universities, research institutes and
companies, and allow the generation of useful knowledge and entrepreneurial competitiveness at international
level. There is also a need for facilitating policies which rectify systemic weaknesses and extend possibilities of
innovation to all companies. Policies which promote development of the knowledge infrastructure and establish
an adequate institutional framework so that the various actors in the system of innovation interact, learn and have
a clear reference framework.


There is no optimal science, technology and innovation policy. The goals and instruments of STI policies must
reflect the specific context and needs of each country. Financial capacities, the historic baggage of STI policies
and institutions4 as well as current capacities will determine the relevance of one or another type of policy or
instrument.


Lastly, successful experiences highlight the importance of synchronizing STI polices and national social,
economic and productive development policies in minimizing coordination failures and the overlapping of
different policies and ensuring consistency over time. It is also beginning to be recognized that the success of
policies is not determined ex ante, and requires, on the contrary, a continuous learning process based on trial
and error mechanisms5 as well as a strong decision making structure when designing science, technology and
innovation institutions and policies (ECLAC 2009, UNCTAD 2007).


Based on these concepts and ideas, this report evaluates the state of El Salvador’s capacities in science,
technology and innovation. The study examines the various elements of the national system of innovation,
evaluating the current capacity of the system to use and generate knowledge.


The purpose of the report is to present a set of recommendations intended to encourage an environment in
which the different agents can interact and participate, create the infrastructure and conditions necessary to
acquire, use, adopt and generate knowledge, achieve optimal levels of productive investment and achieve
robust and durable economic and social results.


The first chapter presents the general context in which productive activities take place in El Salvador. It includes
a presentation of the economic and social context which frames the objectives and determining factors of STI
and an evaluation of current performance in science, technology and innovation.


Chapter II describes the national system of innovation in El Salvador, based on five strategic functions: cohesion,
foresight, management and control, regulation, and production-execution. The chapter also presents the principal
innovation policy instruments used in El Salvador.


Chapter III goes on to provide a diagnostic of the national system of innovation, with a view to identifying these
strategic areas in which the Government’s policies, programmes and actions can have the greatest influence
on the development of STI in El Salvador, and analyses the various proposals for strengthening the components
and relations of the country’s national system of innovation.


Chapters IV and V provide a more detailed examination of the system of innovation in two sectors chosen by the
Government of El Salvador: agro-industry, and information and communication technologies (ICT). Agro-industry
has a considerable importance, given its potential to create added value and serve as a stimulus for agricultural
and rural development. The ICT sector is of great importance on account of its potential for underpinning the
development of a new techno-productive paradigm and its cross-cutting character, which enable it to influence
a large number of productive activities and sectors.


Finally, Chapter VI offers a series of recommendations designed to strengthen the national system of innovation
and a possible road map which marks out the actions which could be taken in the short, medium and long term.


INTRODUCTION




xx Science, Technology and Innovation Policy Review - El Salvador


NOTES
1 Included in the Integral Export Development Strategy 2010-2014.
2 See, for example, Dosi, Pavitt and Soete (1990).
3 The lack of possibility of exclusion and non-rivalry in the consumption of knowledge hinders the full appropriability of


the benefits of the generation of knowledge and discourages private investment in its generation, resulting in levels of
investment below the social optimum.


4 Achieving effective reform of institutions inherited from the past and redefining and articulating the various aims of
institutions created on the basis of different rationales and contexts are some of the main challenges that have to be faced
by STI policies (ECLAC 2008, 2009).


5 As part of the great variety of “learning by doing” or “learning by interacting”, forms of internal learning called “learning by
failing” have been identified, whereby learning comes more through error than success.




General background of science,
technology and innovation


in the economy of El Salvador




2 Science, Technology and Innovation Policy Review - El Salvador


El Salvador is the smallest and, with six million people,
the most densely populated country in Central
America. It is situated on the shore of the Pacific
Ocean, between Guatemala and Honduras. To provide
a better understanding of the state and background to
science, technology and innovation in El Salvador, this
chapter seeks, firstly, to describe the chief economic
features which frame the country’s technological and
innovative development. It then goes on to analyse the
country’s current achievements in science, technology
and innovation.


During the last two decades (in which a series of
structural reforms and liberalizing economic policies
were implemented following the signing of the Peace
Accords in 1992), El Salvador has achieved constant,
albeit modest, economic growth, with an average
growth rate of 3.5 per cent over the period 1990-2009
(Figure 2).


This economic growth is not sufficiently robust or
balanced to promote sustainable social and economic
development.


In 2009, gross domestic product (GDP) contracted
by 3.5 per cent and grew very modestly (1 per cent)
in 2010 (ECLAC 2011). Moreover, the impact of the
economic crisis was more serious and the level of


recovery much lower in the Salvadorian economy than
in the rest of Centroamerican countries (Figure 1).


The inadequate growth is related to the high levels of
migration, high under-employment and the constant
decline in real wages. Each year, over 60,000
Salvadorians (in net terms) emigrate in search of
better opportunities. At present, some three million
Salvadorians live abroad1, and remittances sent by
Salvadorians from abroad accounted for 16.4 per cent
of GDP in 2009. Forty per cent of the economically
active population is under-employed2, and the labour
underutilization rate (unemployment plus under-
employment) reaches 50 per cent of the economically
active population (UNDP 2010b). Lastly, it should also
be noted that since 1992, average real wages have
stagnated (UNDP 2010b).


The country’s long-term economic development
cannot be sustained by family remittances or by a
competitiveness based on a low cost labour market.
For productive activity in El Salvador to be competitive
while at the same time workers are paid a fair wage,
productivity must be improved based on technological
improvements and business innovation.


Analysis of the performance of the Salvadorian econo-
my shows that the country suffers from low multifactor


Figure 1. Latin America and the Caribbean: annual GDP growth rate, 2009-2010 (as percentage)


Source: UNCTAD, based on ECLAC 2011.


- 7.0 - 5.0 - 3.0 - 1.0 1.0 3.0 5.0


- 1,6
1.0


1.9


2.5
3.0


6.0
6.3


7.0
7.7


8.4
8.6


9.0
9.7


5.3


2.5


3.5


5.3


4.0
4.0


3.8


- 7.0 - 5.0 - 3.0 - 1.0 1.0 3.0 5.0 7.0 9.0 11.0


Ecuador
Guatemala
Colombia
Argentina


Peru
Cuba


Uruguay
Panama


Bolivia (Plurinational State of)
Dominican Republic


- 6.5
- 3.8


- 3.5


- 1.9


0.8
0.9
0.9


1.4


2.9
3.2
3.4


3.5


0.5


- 3.3


- 1.5


0.4
- 0.2


- 1.1


- 1.5


- 1.9


Venezuela (Bolivarian Republic of)
El Salvador


Cuba
Honduras


Guatemala
Nicaragua


Ecuador
Bolivia (Plurinational State of)


Costa Rica
Colombia


Mexico


Chile
Latin America and the Caribbean


Panama
Dominican Republic


Brazil
Argentina


Peru
Uruguay


Paraguay


Mexico
Paraguay
El Salvador
Venezuela ((Bolivarian Republic of)
Honduras
Latin America and the Caribbean
Chile
Nicaragua
Costa Rica
Brazil




3Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


GDP Multifactor productivity Capital Labour


1950-1959 4.7 1.5 2 1.2


1960-1969 5.6 2.2 1.5 1.9


1970-1979 3.8 -1.3 2.4 2.7


1980-1989 -2.1 -3.2 0.3 0.8


1990-1999 4.9 1.3 1.2 2.4


2000-2009 2.1 -0.2 1.0 1.3


Source: UNDP (2010) – Based on Fusades, 2003.


Table 1. GDP growth and critical factors of growth in El
Salvador, 1950-2009


Costa Rica El Salvador Guatemala Honduras Nicaragua Panama


GDP (millions of dollars) 29,240 21,101 37,322 14,318 6,140 24,711


GDP per capita (purchasing power parity dollars) 11,106 6,629 4,720 3,842 2,641 13,057


Total population 4,578,945 6,163,050 14,026,947 7,465,998 5,742,800 3,453,898


Area (km2) 51,060 20,720 107,160 111,890 119,990 74,340


Human Development Index 2010 (ranking) 62 90 116 106 115 54


Source: World Development Indicators, World Bank; UNDP (2010a).


Table 2. El Salvador in the Central American context, 2009


productivity. In other words, innovation and technol-
ogy have made scant contribution to GDP growth and
have even had an adverse impact (Table 1).


Advances in a country’s output levels are closely
related to its scientific, technological and innovative
capacity. The development of productive capacity
and dynamic competitiveness requires both the
development of human resources that are capable
to assimilate, adapt and develop technology in a way
that can be integrated in local productive processes,
and the development of a set of conditions conducive
to innovation and the introduction of improved
productive processes.


A. PERfoRmAncE And
EvoluTIon of ThE
SAlvAdoRIAn Economy3.


1. Macro-economic performance
El Salvador is ranked fourth among Central American
economies in terms of GDP, third in terms of per
capita income (3,430 dollars), behind Costa rica and
Panama. In terms of human development, El Salvador
is ranked 90th according to the Human Development
Index 2010, also behind Costa rica and Panama
(Table 2).


In the last two decades, El Salvador has implemented
a set of liberal economic policies with the objective of
developing an open economy (centred on production
for export and attracting foreign investment) and
achieving macro-economic balance. A series of
structural reforms were undertaken, including a major
privatization and liberalization process of the financial,
electricity and telecommunications sector and the
pension system. In 2001, the Salvadorian economy
was converted to the dollar in order to promote stability
for investors, reduce inflationary pressures and reduce
real interest rates. Several free trade agreements were
signed with Colombia, Guatemala and Honduras,
the United States (Dr-CAFTA), Panama, Mexico,
Chile and Taiwan, Province of China. The Salvadorian
Government also pursued a prudent fiscal policy.


These structural reforms and economic policies
led to the development of the supply of important
economic services in the country, the diversification of
the economy and a degree of economic stability, with
inflation under control, but did not achieve robust or
economic growth (Figure 2).


The chief reasons for this sluggish economic growth
can be found in low levels of investment and national


Section A below provides a summary of the macro-
economic performance and structural conditions
governing the country’s productive performance.
Section b, in turn, presents its performance in terms of
science, technology and innovation with a summary
of the principal science, technology and innovation
indicators in El Salvador.




4 Science, Technology and Innovation Policy Review - El Salvador


Panama Costa Rica El Salvador Guatemala Honduras Nicaragua


As percentage of GDP 23.80 26.70 13.12 15.07 22.58 27.31


Growth rate (%) -6.21 -15.78 -17.43 -15.46 -32.40 -22.54


Millions of dollars 5,881 7,807 2,768 5,624 3,233 1,677


Source: World Development Indicators, World Bank.


Table 3. Gross fixed capital formation, Central American countries, 2009


savings. El Salvador consumes more than it produces.
The inflow of family remittances4 financed high levels of
consumption which could not be satisfied by domestic
production and led to the importing of goods and
services, thus creating significant distortions in the
balance of goods and services. Family remittances
have not been used for investment purposes5 and
have even been accompanied by a decline in the rate
of national saving. The expansion of private credit has
also served to finance high levels of consumption.
The high volume of remittances also threatens the
country’s industrialization, by increasing the price
of non-tradeable products and causing a loss of
competitiveness in the traditional export sector.


Table 3 shows that El Salvador invests less in gross
fixed capital formation than the other Central American
countries, both as a proportion of GDP and in absolute
terms6. In addition, the savings and investment
necessary to develop productive capacity have been
declining in recent years (Table 4).


Lastly, the low levels of tax revenue and high levels
of debt restrict the availability of public resources. It
is estimated that, in 2010, total public debt stood at


50 per cent of GDP and the tax collection capacity
was only 13.2 per cent of GDP (ECLAC 2011).


In the short term, one of the chief concerns of economic
policy is to achieve fiscal targets and the structural
reform criteria stipulated in the stand-by agreement
signed with the International Monetary Fund (IMF) in
2010 with a precautionary loan of 790 million dollars.


Trade and trade policy


El Salvador has pursued an open trade policy based
on the development of the manufacturing industry
for export (assembly for re-export). Consequently,
since 2005, export manufacturing has accounted for
a considerable volume of exports and, after family
remittances, is El Salvador’s principal source of foreign
exchange. The remainder of the export sector is highly
diversified. Among the biggest exports are traditional
products such as coffee and sugar, as well as other
non-traditional items such as prepared medicines.
Manufactured products with a high or medium
technological intensity are only a small proportion of
exports. The principal services exported come under
the heading of transport and travel, although transport


Figure 2. GDP growth rates and trends, 1990-2009


Source: UNCTAD, based on World Bank.


GDP (millions of dollars
constant 2000 prices)


GDP per capita (dollars at
constant 2000 prices)


GDP (annual rate of growth as %)


M
ill


io
ns


o
f d


ol
la


rs
/d


ol
la


rs


(a
t c


on
st


an
t 2


00
0


pr
ic


es
)


An
nu


al
ra


te
o


f g
ro


w
th


(%
)


-6


-4


-2


-


2


4


6


8


10


-


2,000


4,000


6,000


8,000


10,000


12,000


14,000


16,000


18,000


1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009




5Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


2004 2005 2006 2007 2008 2009


Total demand in millions of dollars (constant 1990
prices) 13,194 13,636 14,479 15,339 15,849 14,014


National consumer spending 8,380 8,783 9,201 9,927 10,318 9,408


Household 7,737 8,126 8,530 9,269 9,622 8,682


Public administrations 643 657 671 658 695 726


Gross capital formation 1,540 1,607 1,857 1,754 1,671 1,380


Gross fixed capital formation 1,485 1,513 1,703 1,754 1,671 1,380


Private 1,337 1,317 1,505 1,570 1,466 1,167


Public 148 197 198 184 206 213


Variation in assets 55 94 154 0 0 0


Exports of goods and services 3,274 3,246 3,422 3,658 3,861 3,226


Total supply in millions of dollars (constant 1990
prices) 13,194 13,636 14,479 15,339 15,849 14,014


Imports of goods and services 5,026 5,196 5,684 6,163 6,450 4,948


GDP 8,168 8,440 8,795 9,176 9,399 9,067


GDP per capita (current dollar prices) 2,621 2,846 3,087 3,341 3,609 3,430


GDP per capita (constant 1990 dollars) 1,355 1,395 1,448 1,505 1,535 1,474


Real GDP rate of growth per capita 1.5 3.0 3.8 3.9 2.0 -4.0


Inflation rate 5.4 4.3 4.9 4.9 5.5 -0.2


Family remittances as percentage of GDP 16.1 17.5 18.5 18.1 17.1 16.4


Real rate of GDP growth 1.9 3.3 4.2 4.3 2.4 -3.5


Consumption 2.8 4.9 5.0 8.3 4.3 -9.8


Government 0.1 0.2 0.2 -0.2 0.4 0.3


Private 2.7 4.8 4.8 8.4 3.8 -10.2


Investment -0.8 0.8 3.0 -1.2 -0.9 -3.1


Exports 1.4 -0.3 2.1 2.7 2.2 -6.9


Imports (-) 1.6 2.1 5.8 5.5 3.1 -16.3


GDP (in millions of dollars at current prices) 15,798 17,214 18,749 20,377 22,107 21,101


Gross national saving 1,918 2,117 2,403 2,025 1,614 2,394


Private 1,700 1,872 2,063 1,570 1,220 2,662


Public 218 245 340 455 393 -268


Foreign saving 642 610 783 1,221 1,682 374


Source: UNCTAD, based on UNDP (2010) and ECLAC data (2010).


Table 4. El Salvador: selected economic indicators, 2004-2009


shows a negative balance (see Tables 5 and 6 and
Figure 3). The appreciation in the real exchange
rate (Table 7) has not helped exports of Salvadorian
products.


Imports are beginning to recover after their dynamic
growth was restrained by the 2009 crisis (Figure 4). The
breakdown between consumer goods, intermediate
goods and capital goods remained more or less stable,


subject to price fluctuations (cf. oil prices). However,
a tendency to an increase in the weight of consumer
goods in total exports can be seen, together with a fall
in transport and communication goods and imports
by the export manufacturing industry as a result of the
crisis (Figure 4).


El Salvador relies heavily on trade with the United States.
48.3 per cent of exports are to the United States. The




6 Science, Technology and Innovation Policy Review - El Salvador


other main trading partners are the Central American
countries (Guatemala (13.8 per cent), Honduras
(12.8 per cent), Nicaragua (5.4 per cent), Costa rica
(3.6 per cent) and Panama (2.3 per cent))7.


Against this background, it should be noted that, in
July 2010, the Ministry of Economy (MINEC) launched
the Comprehensive Export Promotion Strategy
2010-2014 designed to internationalize companies


and increase El Salvador’s competitiveness. The strat-
egy seeks to diversify markets and products, stimulate
the supply of products with added value and promote
the competitiveness of Salvadorian products, giving
preference, among other things, to strengthening the
technological and innovative capacity of Salvadorian
companies.


This strategy is described in more detail in Chapter 2.


Figure 3. Trends in exports of goods, based on their technological intensity, El Salvador, 2000-2009
(in thousands of dollars)


Note: the data reported by Comtrade use the Lall product classification to determine technological intensity.
Source: UNCTAD, based on UNSD Comtrade data (February 2011).


2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
0


500,000


1,000,000


1,500,000


2,000,000


2,500,000


3,000,000


3,500,000


4,000,000


4,500,000


5,000,000


Medium technological intensity
manufacture: engineering


Low technological intensity manufacture
(textiles, clothing, footwear)


Primary goods


High technological intensity
manufacture: other
High technological intensity
manufacture: electronics and electrical


Medium technological intensity
manufacture: processes
Medium technological intensity
manufacture: motor cars
Low technological intensity
manufacture: other products


Manufactured goods based on
resources (other)
Manufactured goods based on
resources (agricultural products )


Figure 4. Import trends, El Salvador, 2006-2010, (in thousands of dollars)


Source: UNCTAD, based on data from the Central Reserve Bank of El Salvador.


Capital goods (Transport and
Communications)


Intermediate goods (Agricultural))


Consumer goods (Non durable)


Assembly


Capital goods (Other: construction,
commerce, services, electricity,
water and other)


Capital goods (Manufacturing
industry)


Intermediate goods (Other)


Intermediate goods (Construction)


Intermediate goods
(manufacturing industry)


Consumer goods (Durable)


2006 2007 2008 2009 2010
0


2,000


4,000


6,000


8,000


10,000


12,000




7Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


Exports (%) Imports (%) Balance


Goods (FOB) 3,860.9 100.00 6,706.1 100.00 -2,845.2


General goods 2,287.3 59.24 5,780.6 86.20 -3,493.3


Coffee 230.3 0.06


Sugar 88.4 0.02


Prepared medicines- therapeutic/prophylactic use 97.8 0.03


Toilet paper sheets for domestic use 96.9 0.03


Goods for transformation (assembly) 1,487.4 38.52 839.0 12.51 648.3


Services 835.2 100.00 1,260.3 100.00 -425.1


Transport 271.5 32.51 700.4 55.57 -428.9


Travel 319.4 38.24 186.8 14.82 132.6


Communications 141.0 16.88 32.2 2.55 108.8


Construction 24.9 2.98 10.3 0.82 14.6


Insurance 30.1 3.60 174.6 13.85 -144.5


Financial services 1.0 0.12 7.8 0.62 -6.8


Information services 0.1 0.01 4.3 0.34 -4.2


Royalties 0.4 0.05 26.0 2.06 -25.6


Personal, cultural and leisure 0.0 0.00 0.5 0.04 -0.5


Government services 29.1 3.48 29.0 2.30 0.2


Other business services 17.6 2.11 88.3 7.01 -70.7


Source: Central Reserve Bank of El Salvador and ECLAC 2011.


Table 5. Exports and imports of El Salvador, 2009 (in millions of dollars)


Foreign direct investment8


between 1995 and 2009, El Salvador attracted a to-
tal of 6.3 billion dollars with an average of 421 million
dollars per year9. El Salvador is placed behind Pan-
ama and Costa rica in its capacity to attract foreign
investment, both in absolute terms and per cap-
ita (Figure 5). Since 1995, inflows to El Salvador of
foreign direct investment per capita have averaged
70 dollars, while Panama and Costa rica had an


average of 346 and 203 dollars respectively.


The main FDI was in the electricity and telecommu-
nications sectors in 1998, as a consequence of their
privatization, and in the financial sector in 2007 when
Citibank and HSbC made various acquisitions. An-
other sector which received significant volumes of FDI
is manufacturing, especially the textiles industry and,
more recently, the electronics, motor parts and agro-
industrial markets (UNCTAD 2010).


2004 2005 2006 2007(p) 2008(p) 2009(p)


Balance on current account -642 -610 -783 -1,221 -1,682 -374


Balance on goods and services -2,739 -3,066 -3,724 -4,395 -4,978 -3,270


Exports 4,290 4,392 4,774 5,169 5,652 4,696


Imports -7,029 -7,459 -8,498 -9,564 -10,629 -7,966


Income -458 -579 -531 -576 -536 -664


Transfers 2,555 3,035 3,472 3,750 3,832 3,561


Workers’ remittances 2,548 3,017 3,471 3,695 3,788 3,465


Balance on capital account and financial 276 929 1,094 400 1,380 500


Reserves 53 59 -72 -280 -334 -429


(p) Provisional figures.
Source: Central Bank of El Salvador.


Table 6. Balance of payments of El Salvador, 2004-2009 (millions of dollars)




8 Science, Technology and Innovation Policy Review - El Salvador


2004 2005 2006 2007 2008 2009(p)


Real exchange rate (base 1993=100) 97.3 96.1 95.3 93.8 90.8 90.0


(p) Provisional figures.
Source: ECLAC.


Table 7. Real exchange rate, base 1993=100, 2004-2009


2. Structural conditions
2.a Sectoral structure
El Salvador has a diversified economy. In the manufac-
turing sector, which contributed 24.1 per cent of GDP
in 2010), the export manufacturing sector (11 per cent
of manufacturing), the chemical industry (9.4 per cent)
and milling and baking industry (8.8 per cent) stand
out. The commercial sector, which covers retail, hotels
and restaurants is the second most important sector,
representing 21 per cent of GDP in 2010 (Figures 6
and 7). The infrastructure sector (predominantly trans-
port, storage and communications, but also construc-
tion, electricity, gas and water) performed well, and
now constituted 14.7 per cent of GDP. In the financial
sector, which accounts for 12.3 per cent of GDP, men-
tion should be made of banks and insurance. Govern-
ment spending fell further and, in 2009, accounted for
5.2 per cent of GDP.


The weight of the agricultural sector in the national
economy declined in the period 1990-2003 but has


been rising slightly since then. In 2009, the agricultural
sector contributed 14 per cent of GDP. This sector,
which has undergone major changes, is now mainly
concentrated in agricultural products (identified in
Figure 8 as other agricultural production), staple
grains and livestock. Green coffee, the most important
agricultural product in the 1990s, has lost its former
pre-eminence (Figure 8).


2.b Entrepreneurial structure
El Salvador’s industrial structure is characterized by a
large number of micro-enterprises which employ almost
36 per cent of the country’s employed population
(DIGESTyC 2005). The commercial sector has a large
number of establishments, but contributes rather less
to the labour market. Commerce concentrates 66 per
cent of establishments but employs only 26 per cent
of workers (Table 8).


In addition to the external productivity gap (the
country’s technological capacity straggles behind in


Figure 5. Inflows of foreign direct investment, Central American countries, 1995-2009 (millions of dollars)


Source: UNCTAD, foreign direct investment database.


Costa Rica Guatemala Nicaragua Panama


1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


El Salvador


-


500


1,000


1,500


2,000


2,500


Honduras




9Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


international terms), El Salvador, like the rest of the Latin


American countries, is also characterized by internal


productivity gaps. There are marked differences in


productivity between different sectors and within


sectors, as well as between enterprises (micro, small,


medium-sized and large or between national and


transnational companies) which are much greater


than those seen in industrialized countries (ECLAC,
2010).


While the external gap reflects limited spread of best
international practice to a country like El Salvador,
the internal gap represents the limited spread of best
practice between agents, sectors and enterprises
inside the country.


Figure 6. Structure of the Salvadorian economy, 1990 -2009 (as percentage of GDP)


Note: (r): revised data, (p): preliminary data.
Source: UNCTAD, based on data of the Central Reserve Bank of El Salvador.


Agriculture and mining


Infrastructure (construction; electricity, gas, water; transport,
storage and communications)


Manufacturing industry


OtherFinancial sector (financial and insurance establishments; property leasing)


Commerce
Government services


0


5


10


15


20


25


30


1990 1991 1992 1993 1994 1995 1996 1997
(r)


1998 1999 2000 2001 2002 2003 2004
(r)


2005
(p)


2006
(p)


2007
(p)


2008
(p)


2009
(p)


Pe
rc


en
ta


ge
o


f G
DP


14.2


24.1


14.7


21.0


12.3


5.2
8.5


Figure 7. Manufacturing industry in El Salvador, 1990 -2009


Note: (r): revised data, (p): preliminary data.
Source: UNCTAD, based on data of the Central Reserve Bank of El Salvador.


Flour and bread products
Other processed food products
Textiles and articles made from textiles (except clothing)
Basic chemicals and compounds
Basic and transformed metal products


Sugar
Beverages
Printing products and related industries
Products of oil refining
Assembly industry


%
o


f m
an


uf
ac


tu
rin


g
in


du
st


ry


0


2


4


6


8


10


12


14


16


1990 1991 1992 1993 1994 1995 1996 1997
(r)


1998 1999 2000 2001 2002 2003 2004
(r)


2005
(p)


2006
(p)


2007
(p)


2008
(p)


2009
(p)


8.8
9.4


11




10 Science, Technology and Innovation Policy Review - El Salvador


Establishments % Persons %


Services 32,180 18 258,137 37


Industry 22,788 13 195,650 28


Commerce 115,540 66 183,126 26


Transport and communications 4,065 2 30,819 4


Construction 447 0 16,838 2


Agroindustry 79 0 8,860 1


Electricity and water 71 0 5,937 1


Mining and quarrying 8 0 214 0


TOTAL 175,178 … 699,581 …


Source: DIgESTyC (2005).


Table 8. Entrepreneurial structure by economic activity (economic census of 2005)


2.c Infrastructure
El Salvador’s infrastructure has improved significantly
during the last two decades and is now, in general
terms, among the best in Latin America (Table 9)10.


El Salvador has a good road network and air infra-
structure (Table 9). The country has four airports with
tarmac runways, the most important of which is El
Salvador International Airport, the headquarters of
the Salvadorian airline TACA. It is envisaged that the
80 million dollar project to expand the airport will start
at the end of 2011. The Salvadorian road network
covers over 6,600 kilometres, half of which is tarmac.
The country has two major parallel west-east corridors.


Currently, as part of the Mesoamerican cooperation
project, a land corridor is being constructed which will
link the Port of Cutuco, El Salvador (Pacific Ocean)
with Puerto Cortés, Honduras (Atlantic Ocean).


The port infrastructure has been greatly improved
with the construction of a second port in La Unión,
which is intended to become the cargo hub for Central
America. The construction of the port was completed
in 2009, but there have been considerable delays
in bringing it into operation due to the difficulty of
obtaining approval of its management model.


The electricity infrastructure covers 83 per cent of the
territory (97 per cent in urban areas and 72 per cent in
rural areas). The country has an installed capacity of


Figure 8. Principal activities in the agricultural sector, El Salvador


Note: (p): provisional data.
Source: Own preparation based on data of the Central Reserve Bank of El Salvador.


1990 1991 1992 1993 1994 1995 1996 1997
(r)


1998 1999 2000 2001 2002 2003 2004 2005
(p)


2006
(p)


2007
(p)


2008
(p)


2009
(p)


Green coffee
Cotton
Staple grains


Sugar cane
Other agricultural production
Livestock


Poultry
Forestry
Hunting and fishing products


0


5


10


15


20


25


30


%
o


f G
DP


fr
om


a
gr


ic
ul


tu
re


, h
un


tin
g,


fo
re


st
ry


a
nd


fi
sh


in
g




11Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


General quality of the infrastructure 44


Quality of roads 29


Quality of railway infrastructure 110


Quality of port infrastructure 71


Quality of air infrastructure 33


Passenger seat kilometres available in airlines 86


Quality of electricity supply 60


Fixed telephone lines 70


Mobile telephone subscribers 31


Source: global Competitiveness Report 2010-2011.


Table 9. The infrastructure of El Salvador, 2010
(ranking out of 139 countries)


1,490 megawatts (MW) and a net generating capacity
of 5,504 gigawatt/hour (GWh) and it is the biggest
producer of geothermal energy in Central America.11
However, the country is a net importer of electricity. El
Salvador is part of the electricity infrastructure project
of SIEPAC, the first regional electricity transmission
system which is intended to reduce the cost of
electricity by creating a regional electricity market. It is
envisaged that the project will be finalized in 2011.


The telecommunications infrastructure has undergone
a remarkable development during the last decade,
especially mobile telephony, where there are 113
subscriptions for every 100 inhabitants. Although
the number of fixed lines has tripled during the last
decade, and there are now 17.5 fixed lines for every
100 inhabitants, the average per inhabitant is still well
below that of Costa rica (Table 10).


2.d. Entrepreneurial competitiveness
According to the Global Competitiveness Index of the
World Economic Forum (WEF 2010), El Salvador’s
competitiveness is in decline. Currently, the country is
ranked 82, far below Panama (53) and Costa rica (56)
and slightly behind Guatemala (78). Since 2005-2006,
El Salvador has dropped 19 places in a constant
sample of 119 countries (INCAE 2010).


Among the strengths of Salvadorian competitiveness,
the WEF report highlights the efficiency of the goods
market and the level of development of the infrastruc-
ture (roads, air and mobile communication) as well
as certain macro-economic conditions (in particular,
inflation under control), the quality of local suppliers
and labour flexibility. However, the country’s competi-
tiveness is limited by its scant capacity for innovation,
the weaknesses of public institutions and the short-
comings of the education system (Figure 9).


For investors and executives, crime, the instability of
policies and limited access to financial resources are
the chief obstacles to doing business in the country
(WEF 2010).


2.e. Education
Education is a critical factor in the development of
competencies and skills for a trained and productive
labour force. This key element of technological and
innovative development is one of the principal weak-
nesses of El Salvador.


El Salvador has invested an average of 3 per cent
of GDP in education (1999-2011), clearly below the
average levels of investment of Costa rica (some


El Salvador Costa Rica Guatemala Honduras Nicaragua Panama


Fixed broadband Internet subscriptions 123,469 107,410 79,000 - 36,058 195,785


Broadband Internet subscriptions
(per 100 persons) 2.01 2.38 0.58 - 0.64 5.76


Internet users 650,000 1,460,000 1,960,000 958,000 185,000 934,457


Internet users (per 100 persons) 10.60 32.31 14.32 13.09 3.26 27.49


Mobile telephone subscribers
(per 100 persons) 113.32 41.75 109.22 84.86 54.84 115.19


Telephone lines (per 100 persons) 17.56 31.81 10.59 11.28 5.51 15.42


Secure Internet servers* 73 450 123 53 36 296


Secure Internet servers (per million persons)* 11.84 98.28 8.77 7.10 6.27 85.70


(*)=2009 data.
Source: World Development Indicators, World Bank.


Table 10. Principal ICT infrastructure indicators, 2008




12 Science, Technology and Innovation Policy Review - El Salvador


Costa Rica El Salvador Guatemala Honduras Nicaragua Panamá


Illiterate population aged 15 years and over (% of
population aged 15 years and over), 2010 3.2 16.6 25.2 19.4 30.3 6.0


Public spending on education (% of GDP), 2008 5.1 3.6(4) 3.2 .. 3.1(1) 3.8


Net enrolment rate, primary (%), 2008 .. 94.2(4) 95.1 .. 91.8 98.3


Net enrolment rate, secondary (%), 2008 .. 56.4(4) 39.9 .. 45.2 65.6


Gross enrolment rate, tertiary (%), 2008 .. 24.6 17.7(3) 17.1(2) 18(1) 45.1


Average pupils per teacher, primary, 2008 18(4) 31(4) 29 33 29 24


Average pupils per teacher, secondary, 2008 16(4) 24(4) 17 .. 29 15


Rate of survival to 5th grade, 2007 to 2008 96 80 71 78 51 87


Ranking in Education for All Development Index, 2007 .. 94 98 87 101 66


Notes: (1) 2003 data, (2) 2004 data, (3) 2007 data, (4) 2009 data.
Source: UNCTAD, based on ECLAC statistical yearbook 2011, global Education Digest 2010 and FUSADES (2010).


Table 11. Indicators of educational coverage and quality in Central America, 2008


5 per cent) and Panama (over 4 per cent). The budget
approved for 2011 is 704.69 million dollars.12


Considerable progress has been made in recent
years in school coverage but the prolonged low levels
of investment in education have limited educational
achievements. The set of indicators of educational
coverage and quality (Table 11) shows that the country


is better placed than Guatemala, Honduras and
Nicaragua, but lags behind Costa rica and Panama.
The most significant weaknesses are found in the rate
of students staying in school and the coverage of the
educational system, especially at secondary and pre-
primary level, and in student achievements.


There are gaps in educational coverage in rural areas


Figure 9. Competitiveness of El Salvador, 2010-2011


Innovation


Business
sophistication


Market size


Technological
readiness


Financial market
development


Infrastructure


Macroeconomic
environment


Health and
primary
education


Higher education
and training


Good market effiency


Institutions


Labor market efficiency


Factor
driven


1 Transition2-32 3


Efficiency
driven


Innovation
driven


Transition
1-2


7


6


5


4


3


2


1


Efficiency-driven economiesEl Salvador


Source: Schwab (2010).


Ranking
(out of 139
countries)


Score (1 to 7)


Global competitiveness index 2010-2011 82 4.0


Global competitiveness index 2009-2010 77 4.0


Global competitiveness index 2008-2009 79 4.0


Basic requirements 71 4.4


Institutions 101 3.4


Infrastructure 59 4.1


Macro-economic stability 64 4.7


Health and primary education 81 5.5


Efficiency enhancers 87 3.8


Higher education and training 101 3.5


Goods market efficiency 53 4.3


Labour market efficiency 88 4.2


Financial market development 78 4.0


Technological readiness 81 3.4


Market size 87 3.2


Innovation and sophistication factors 96 3.2


Business sophistication 68 3.9


Innovation 126 2.5




13Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


and in the lowest income strata of the population (Ta-
ble 12), as well as in the final years of secondary and
(non-compulsory) pre-school education (Figure 10).


There are still high levels of repetition, abandonment
and over-age pupils in primary and secondary
education (Table 13). For example, one third of grade
one pupils have educational problems (abandonment,
repetition or over age) (FUSADES 2009).


As regards quality of teaching, the national education
assessments PAESITA13 and PAES14, show that a great
percentage of students have still not developed the
average expected skills and competencies (in math-
ematics and language). International quality assess-
ments place El Salvador well behind other countries in
the region. For example, El Salvador scores well below
the average obtained by the countries which took part
in the TIMSS 2007 (Gonzáles et al. 2009) for pupils
in the fourth and eighth grade in several countries15.
Similarly, the Second Explanatory regional Compara-
tive Study (LLECE 2007), carried out in 2006 of pu-
pils in the third and sixth grades in 16 Latin American
countries, showed that Salvadorian students scored
below the regional average in all the tests except in
language in the third grade.


The education system is governed by the General
Education Act of El Salvador (amended in 2005),
the Higher Education Act (2004) and the Act on the
Career of Teacher (amended in 2001). The National
Education Plan 2021 (2005) is the second and most
recent national plan in the sphere of primary and
secondary education but has ceased to be the point
of reference. El Salvador does not have a national
strategy for tertiary education. The recent Five-
year Development Plan 2010-2014 (2010) indicates
eight priority action lines in the area of education:


fair access to and keeping pupils in the education
system, curriculum, professional improvement and
development of the teaching profession, institutional
strengthening, continuing training, integration of
scientific and technological research, strengthening of
higher education and training for work. The principal
programmes highlighted in the Five-year Plan are:
a) Programme of provision of school uniforms,


shoes and equipment
b) School meals programme
c) National literacy programme
d) National Programme of education and


comprehensive pre-school development
e) Inclusive Education Programme
f) School buildings Programme
g) Science and Technology Programme
h) Enhancing Teachers’ Status (better conditions


of work and professional development)


The revision of the financial allocations in the Five-year
Plan and the budget Act 2011 shows that current efforts
are largely focused on expanding school coverage
and reducing abandonment of school, and less on
improving levels of quality. The two programmes which
currently receive the most attention (they are allocated
49 and 18 per cent of the education budget) are
intended to improve coverage and to keep pupils in the
education system by a general allocation of clothing,
school equipment and meals. These programmes
are not limited to poor families and represent a
considerable current expense which is being financed
from foreign loans (FUSADES 2010). In addition, the
annual budget allocations for increasing the quality of
education and improving school buildings have been
reduced (FUSADES 2009).


Formal education below the university level is pro-
vided by 6,263 educational centres (5,163 public and


1992 2007


Relative poverty Extreme poverty


Years Literacy (%)
Years of


schooling
Literacy


(%)
Years of


schooling
Literacy


(%)
Years of


schooling
Literacy


(%)
Years of


schooling


Country
15-24 85 6.2 94 7.9 94.3 7.4 87.1 6
25-59 73 5.0 83 6.7 79.5 5.2 65.9 3.7


Urban
15-24 93 7.9 96 8.9 96.6 8.3 91 6.9
25-59 86 7.0 90 8.2 86.9 6.4 77.1 5.1


Rural
15-24 75 4.3 89 6.4 91.2 6.3 84.6 5.4
25-59 58 2.6 69 3.7 67.8 3.4 56.5 2.6


Source: FUSADES (2009).


Table 12. Percentage of literate persons and average years of schooling, by geographical area and degree of poverty,
1992 and 2007




14 Science, Technology and Innovation Policy Review - El Salvador


2003 2004 2005 2006 2007


Abandonment (1st grade) 8.7 6.5 8.7 8.9 7.7


Repetition (1st grade) 15.1 14.5 13.8 15.6 14.7


Over age (1st grade) 11.2 11.1 10.6 10.4 8.9


Abandonment (7th grade) 6.4 5.7 8.3 8.3 7.4


Repetition (7th grade) 4.6 5.2 5.7 6.8 7


Over age (11th grade) 17.8 10.8 10.2 10.1 10.8


Source: FUSADES (2009).


Table 13. Rates of abandonment, repetition and over age pupils, 2003-2007 (percentages)


1,100 private) (MINED 2007). Private education is es-
pecially widespread in tertiary education (66 per cent
of students enrolled)16 and in secondary education (27
per cent). Private education covers 19 per cent of chil-
dren enrolled in nursery schools and 11.5 per cent in
primary education (Global Education Digest (2010)).


Higher education17


Higher education is delivered in 24 universities
(1 public), 9 specialized institutes (4 public) and
6 technological institutes (3 public)18. In 2009, there
were 143,849 students in higher education and 16,168
students graduated. 92 per cent of the students were
enrolled in universities and the rest in specialized in-
stitutes (6 per cent) and technological institutes (2 per
cent). The University of San Salvador (public) has 31
per cent of the university students.


Table 14 shows the number of students in higher
education in El Salvador, by area of education and
the level of studies pursued. It should be noted that
postgraduate education is still a minority area in El


Salvador and has developed chiefly in teaching and
business/financial management.19 There are only two
doctorate courses, one in private law and the other in
philosophy. In 2009, there were 2,347 postgraduate
students, and that year two persons graduated with
a doctorate, 558 with a master’s degree and 363
completed the teacher training course. Furthermore,
the number of students at technical level is small in
relation to university students. The limited demand for
technical careers is attributed to the lack of prestige of
these fields (MINED 2010). However, it is noteworthy
mentioning the efforts made through the Technical
and Technological Gradual Learning Education Model
programme (MEGATEC) to harmonize technical
training at the vocational and university level and to
link it to the needs of different productive sectors. This
programme links secondary and tertiary education
in technical areas and responds to local needs for
qualified human resources in specific productive
activities (FUSADES 2009).


As regards the geographical area, university activity
is clearly concentrated in San Salvador (over 55 per


Figure 10. Net school enrolment rates, by level of education, 2000 and 2007 (percentages)


Source: FUSADES (2009).


0 10 20 30 40 50 60 70 80 90 100


2007


2000
Pre-school (4-6 years)


Basic (Grades 1 to 9)


Primary (Grades 1 to 6)


Lower secondary (Grades 7 to 9)


Secondary (Grades 10 to 11)


39.7


84.2


87.2


41.5


23.8


51


96.5


97.4


56.5


35.7




15Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


Area of study Number of students % Level of study Number of students


Economics, management and
commerce 36,595 25 Postgraduate 2,347


Technology 31,838 22 University 119,028
Medicine 23,717 16 Technical 22,474
Law 15,852 11 TOTAL 143,849
Education 13,619 9
Social sciences 6,628 5
Humanities 5,858 4
Art and Architecture 5,169 4
Social sciences 2,644 2
Farming and environment 1,929 1
TOTAL 143,849 …


Source: Ministerio de Educación – Unidad de Estadística Educativa, 2009.


Table 14. Students in higher education by area of education and level of studies, 2009


cent of students). Other important university centres
are found in La Libertad (15 per cent) and San Miguel
(10 per cent).


2.f. Human development
The country’s level of human development, i.e. human
wellbeing going beyond economic wealth, places
Salvadorians below the average for Latin America and
the Caribbean. According to the Human Development
Index (UNDP 2010a), El Salvador is ranked 90 out of
a total of over 180 countries. The historic results of
the index show that considerable progress has been
made, although recent years have been marked by a
stagnation of human development achievements.


There has been considerable progress in reducing
inequalities in incomes, largely due to the positive
impact of remittances in lower-income families.
However, the inequalities in the distribution of wellbeing
(i.e. not only income and wealth but also geographical
inequalities and access to health services, education,
infrastructure, etc.) put a severe strain on human
development. The impact of such inequalities in El
Salvador is among the most serious in Latin America
and the Caribbean (UNDP 2010b).


The high levels of violence recorded in El Salvador20
hinder progress in the economic and human
development of Salvadorians. The violence is a
significant constraint for investors who want to do
business in the country (see section 2.d). Furthermore,
the violence and crime represent a considerable cost
to the State and individuals in terms of prevention,
combating and reparation.


In addition, El Salvador is a country which is constantly


exposed to natural disasters (earthquakes, tropical
storms). The impact of these disasters has been even
more serious given the high level of vulnerability of
Salvadorians. It is calculated that between 1980 and
2008, an average of 1.5 disasters a year occurred in
the country, in which over 7,000 people died. These
disasters had an impact of over 16 billion dollars in
present values or an annual equivalent of 4.2 per cent
of GDP (UNDP 2010b).


B. PERfoRmAncE In ScIEncE,
TEchnoloGy And InnovA-
TIon In El SAlvAdoR


The analysis and evaluation of performance in science,
technology and innovation (STI) require a set of
indicators which provide information on investment (in
human capital and financial resources) and the results
of that investment (patents, publications, technology
balance, etc.). Also required are information on
innovation activities carried out in the country and the
impact of those activities, as well as the relationship
and interaction between the various economic,
political and scientific actors who form part of the
innovation system.


The systematic collection and dissemination of this
information would allow better design, management
and evaluation of STI policies and programmes.
They would also serve as better tools to enable the
private sector to develop competitive strategies
and collaborate with the academic world and public
institutions.




16 Science, Technology and Innovation Policy Review - El Salvador


The National Council for Science and Technology
(CONACyT) regularly collects data on scientific
and technological activities in the higher education
sector based on the methodology established by the
Ibero-American Network of Science and Technology
Indicators (rICyT), in turn based on the Frascati
Manual. However, there is no systematic collection of
information on research and development activities
(r&D) or innovation in the private sector. The lack of
such information limits the comparisons that can be
made with other countries.


Described below are the principal STI indicators
available for El Salvador. It can be observed that
there are gaps in the information, chiefly concerning
investment in r&D by the private sector and innovation
activities carried out in the country.


1. Inputs
Research and development


Investment in r&D, defined as “creative work under-
taken on a systematic basis in order to increase the
stock of knowledge, including knowledge of man, cul-
ture and society, and the use of this stock of knowl-
edge to devise new applications “ (Frascati Manual,
OECD 2002) allows, on the one hand, increasing


the stock of knowledge and, on the other, develop-
ing a country’s endogenous capacities for innovation.
Developed countries invest on average 2,3 per cent of
GDP in r&D (OECD 2010).


Investment in r&D in El Salvador is limited both in
absolute terms and in relation to GDP (Figures 11
and 12). It is estimated that the country invested
0.11 per cent of GDP in 2008. While El Salvador is
top of the group of four Central American countries
(Guatemala, Honduras and Nicaragua) the country
lags behind Costa rica and Panama, and is far from
the levels of investment in r&D in the most advanced
Latin American countries in this field (brazil, Mexico,
Argentina and Chile).


It should be recalled that the figures for investment in
r&D in El Salvador do not include spending by the
private sector. However, we believe that even including
private sector expenditure, the pattern would be
similar, given that the interviews conducted indicate
a very low level of investment in r&D by the private
sector.


The latest data available (CONACyT, 2010) show a
fluctuation in r&D investment and a slight declining
trend (Figure 13).


Expenditure on r&D by higher education institutions


Figure 11. R&D expenditure in El Salvador and other Latin American countries, 2008 (millions of PPP dollars)


Notes: Panama: includes expenditure by the Smithsonian Tropical Research Institute (STRI).
guatemala: Investment in R&D by the public sector and higher education sector.
El Salvador: Expenditure by the higher education sector and government.
Brazil, Peru and guatemala: data for 2004. Chile: dat for 2007. Nicaragua: data for 2002.
PPP: Purchasing Power Parity.


Source: RICyT.


22,466


5,789


2,985


1,233
240 194 80 48 42 10 5


0


5,000


10,000


15,000


20,000


25,000


Brazil Mexico Argentina Chile Costa Rica El Salvador HondurasPeru Panama Guatemala Nicaragua




17Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


Figure 12. Comparative trends in R&D expenditure, El Salvador and selected Latin American countries, 2000-2008
(as percentage of GDP)


Notes: Panama: includes expenditure by the Smithsonian Tropical Research Institute (STRI).
guatemala: Investment in R&D by the public sector and higher education sector.
El Salvador: Expenditure by higher education sector and government.


Source: RICyT.


Pe
rc


en
ta


ge
o


f G
DP


-


0.20


0.40


0.60


0.80


1.00


1.20


2000 2001 2002 2003 2004 2005 2006 2007 2008


0.05


0.15
0.21


0.38


0.06 0.06
0.11


0.40


0.67


1.09


0.52


Peru
Panama
Nicaragua


Mexico
Honduras
Guatemala


El Salvador
Costa Rica
Chile


Brazil
Argentina


Figure 13. Investment in science and technology activities, 2007-2009 (in thousands of dollars)


Note: Expenditure by higher education institutions.
Source: CONACyT, 2010.


139,407
157,828


174,461


17,964 23,859


2,941
11,281


3,152
16,008


-


20,000


40,000


60,000


80,000


100,000


120,000


140,000


160,000


180,000


200,000


2007 2008 2009


Scientific and technological education and training R&D Scientific and technological services


is primarily financed by the Government and the insti-
tutions themselves. The latest data reflect a consider-
able reduction in financing of r&D by higher educa-


tion institutions. In 2009, the public sector financed
64 per cent of this expenditure while the higher educa-
tion institutions themselves reduced their contribution




18 Science, Technology and Innovation Policy Review - El Salvador


significantly compared with the previous year to only
23 per cent of total expenditure on r&D. The same
year, foreign resources served to finance 11 per cent
of that expenditure, while resources contributed by the
private sector did not reach one per cent (Figure 14).


A high percentage of expenditure on r&D is destined


for the social sciences and humanities (41 per cent
of expenditure in 2009). 29 per cent is destined for
the natural and exact sciences, followed by medical
sciences (15 per cent), engineering and technology
(10 per cent) and agricultural sciences (5 per cent)
(Figure 15).


As regards the socio-economic objectives of r&D,
investment in protection of the environment (35 per
cent of r&D expenditure), social structures and
relations (33 per cent) and in third place, human health
(11 per cent) should be highlighted. These investment
priorities have remained constant throughout the last
decade (CONACyT 2010).


r&D projects are chiefly in basic (38 per cent) or
applied research (38 per cent). Consultancy and
experimental development projects represent 13 and
10 per cent of projects respectively. Trials and testing
do not even account for one per cent of projects.


Furthermore, projects tend to be of small scale and
of short duration. The budget of 73 per cent of the
projects is below 10,000 dollars, and only 10 projects
(0.8 per cent) have a budget in excess of 100,000
dollars. In addition, two thirds of the projects have a
duration of under one year and only 10 per cent have
a duration of more than two years. (CONACyT 2010).


El Salvador has a small nucleus of 291 researchers,
not all of whom are dedicated exclusively to research
work. If we take into account the time dedicated to
research, the number of researchers falls to 85. The
number of researchers in El Salvador is meagre,
even in comparison with other countries in the region
(Tables 15 and 16).


Figure 14. R&D expenditure by source of financing, 2008-2009, (in thousands of dollars)


Source: UNCTAD, based on CONACyT (2010).


Non-governmental
organization


Higher education
institution


Foreign


Private enterprise


Own resources


Government
-


5,000


10,000


15,000


20,000


25,000


30,000


16
5
32


110
5
19


12,010


10,751


2008


10,333


3,701


1,839


1,088


2009


Source: CONACyT (2010).


Figure 15. Distribution of R&D expenditure by scientific
and technological area, 2009 (as percentage)


29%


10%


15%
5%


32%


9%


Exact and natural sciences


Engineering and technology


Medical sciences


Agricultural sciences


Social sciences


Humanities




19Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


Figure 16. R&D expenditure by socio-economic objective, 2009 (in thousands of dollars)


Source: UNCTAD, based on CONACyT (2010).


5,431


2,079


2,016


9,013


2,970


2008


5,560


1,729


895


5,339


2009


Other civil research


Non-targeted research


Exploration and exploitation of space


Social structures and relations


Industrial production and technology


Agricultural production and technology


Production, distribution and rational
use of energy


Protection and improvement of human health


Control and protection of the environment


Infrastructure and land planning


Exploration and exploitation of the land


10,000


15,000


20,000


25,000


5,000


-


Argentina Brazil Chile Costa Rica Cuba Guatemala Honduras Mexico Nicaragua Panama Peru
El


Salvador


Full time
equivalent 56,987 240,482 21,689 1,165 ... 1,384 ... 70,391 ... 1,457 ... 85


Total actual
persons 79,391 397,720 30,583 18,383 92,839 1,740 2,280 ... 870 2,545 8,434 291


Honduras: 2003 Chile, Nicaragua, Peru: 2004 Mexico: 2007 El Salvador: 2009.
guatemala: The data provided relate only to staff working on R&D projects in the public sector and higher education
Source: RICyT and CONACyT (2010) for El Salvador data.


Table 15. Staff employed in R&D, full time equivalent and total actual persons, selected countries 2008


Argentina Brazil Chile Costa Rica Cuba Guatemala Honduras Mexico Nicaragua Panama Peru
El


Salvador


Full time
equivalent 2.56 1.32 2.03 0.58 … 0.10 … 0.88 … 0.25 … …


Total actual
persons 3.95 2.09 2.77 1.70 1.10 0.14 0.22 … 0.16 0.30 0.39 0.16


Notes: Researchers include R&D fellows.
guatemala: The data provided relate only to staff working on R&D projects in the public sector and higher education.
Chile, Honduras: data for 2003. Nicaragua and Peru: data for 2004. Costa Rica (EJC): data for 2005. Mexico: data for 2007.


Source: RICyT.


Table 16. Staff employed in R&D per thousand employed persons, full time equivalent and total actual persons,
selected countries, 2008




20 Science, Technology and Innovation Policy Review - El Salvador


Men Women Total %


Teachers 4,600 2,511 7,111 94


Teachers-
researchers 171 123 294 4


Researchers 94 43 137 2


TOTAL 4,865 2,677 7,542 ...


Source: CONACyT (2010).


Table 17. Academic staff by function and sex, 2009


Table 18. Academic staff and researchers by level of education, 2009


Doctorate Master’s First degree Technical/other


Academic staff 292 1,396 5,546 305


(%) 4% 19% 74% 4%


Research 16 32 85 1


(%) 12% 24% 63% 1%


Source: CONACyT (2010).


As regards human resources, three factors should be
emphasized:


(1) the scant dedication to research activities. In 2009,
only 6 per cent (431 persons) of the academic
staff carry out research work (Table 17).


(2) the limited education of academic and research
staff. Only 36 per cent of researchers21 have a
master’s degree or doctorate. Out of the total


number of academics, less than a quarter have a
master’s degree or doctorate (Table18).


(3) women represent 31 per cent of the total number
of researchers.


Science and technology activities (STA)


Investment in El Salvador in the broadest range of
science and technology activities22 is also limited
in comparison with other Latin American countries,
although it is worth mentioning that under this heading,
El Salvador comes above Panama (Figure 17).


Among science and technology activities, teaching
and education is the most important heading,
with a rising trend and growing participation of the
academic sector. On the other hand, the low level and
percentage (2 per cent) of expenditure on scientific
and technological services indicate the scant linkages
between the academic world and the productive
sector (Figure 13).


Figure 17. Expenditure on STA in El Salvador and other Latin American countries, 2008 (millions of PPP dollars)


Notes: Panama: Includes expenditure of the Smithsonian Tropical Research Institute.
Mexico: Only includes federal expenditure on science and technology.
El Salvador: Expenditure by the higher education sector and government.
guatemala: data for 2006. Nicaragua: data for 2004, Peru and Honduras: data for 2003
PPP: Purchasing Power Parity.


Source: RICyT.


29,543


5,602
3,464


1,700 680 381 193 33 11 10
0


5,000


10,000


15,000


20,000


25,000


30,000


35,000


Brazil Mexico Argentina Peru Costa Rica El Salvador Panama Guatemala Honduras Nicaragua




21Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


A considerable proportion of expenditure on STA
is allocated to the social sciences and humanities
(44 per cent of expenditure in 2009). 20 per cent
of the expenditure is destined for engineering and
technology, followed by the natural and exact sciences
(17 per cent) medical sciences (15 per cent) and
agricultural sciences (4 per cent) (Figure18).


Similarly, by socio-economic activity, expenditure
on STA is highly concentrated in the area of social
structures and relations. For example, three times as
much is spent on this objective than on protection or
improvement of human health (Figure 19).


2. Results
One way of studying the results of r&D is through bib-
liometric and patent analysis (and also utility models
and industrial designs). While it is easy to collect in-
dicators in both these spheres, it should be borne in
mind that such analyses have some disadvantages.
bibliometric indicators generally refer to the volume
of articles published in indexed journals and provide
only a rough estimate of the relative quality or impor-
tance of different publications. Nevertheless, these
indicators serve to identify the principal areas of a
community’s scientific knowledge, its impact on the
scientific community (a proxy for quality) and the level
of collaboration.


Patent analysis only reflects part of the scientific and
technological activity of a country’s institutions. There


Source: CONACyT (2010).


Figure 18. Expenditure on STA by scientific and technolo-
gical area, 2009 (as percentage)


17%


20%


15%4%


36%


8%


Exact and natural sciences


Engineering and technology


Medical sciences


Agricultural sciences


Social sciences


Humanities


Figure 19. Expenditure on STA by socio-economic objective, 2009 (thousands of dollars)


Source: UNCTAD, based on CONACyT (2010).


Other civil research


Non-targeted research


Exploration and exploitation of space


Social structures and relations


Industrial production and technology


Agricultural production and technology


Production, distribution and rational
use of energy


Protection and improvement of human health


Control and protection of the environment


Infrastructure and land planning


Exploration and exploitation of the land


2008 2009


34,905


21,259


32,509


57,718


18,033


36,380


27,546


28,937


75,608


100,000


150,000


250,000


200,000


50,000


-


is a great deal of scientific output and innovation which
are not necessarily converted into patents. Some minor
adaptations, which play a particularly important role in
developing countries, can be enormously beneficial
but are not necessarily patented.




22 Science, Technology and Innovation Policy Review - El Salvador


a) Bibliometric analysis


For the purpose of this review, a bibliometric study
of publications was carried out to help identify the
strongest areas of research in El Salvador and
to guide decisions in setting priorities. The study
includes identification of the principal thematic areas
of research, the impact of published articles, the
research topics where there is the greatest scientific
output and the collaboration networks established
with other countries for research.


In summary, the study identified 420 publications in
indexed journals in which authors resident in El Sal-
vador participated, with an average of four articles per
year in recent years (the lowest number of articles in
Central America). The research topics with the great-
est number of publications are public, environmental
and occupational health and the science of plants.
The areas with the greatest impact are immunology,
the respiratory system, meteorology and atmospheric
sciences, and food sciences and technology. Consid-
ering only articles where the main author lives in El
Salvador, the areas of greatest impact are oncology,
orthopaedics, health policy and services, paediatrics,
andrology, nutrition and ophthalmology. The Univer-
sity of El Salvador stands out among all research bod-
ies for its volume of output. As regards the impact of
publications, research by Salvadorian bodies shows
little impact, with the exception of rosales Hospital.


Chapter I (section D) provides a more extended
summary of the results and Annex F presents the
methodological details of the study together with the
results obtained.


The CONACyT study (2010) of science and technol-
ogy activities shows a higher output of scientific litera-
ture at national level than reflected in the bibliometric
study. It is likely that much of this national output does
not have the necessary relevance or quality to appear
in indexed journals at international level or that the
costs involved in publication are high for researchers.
For example, less than 30 per cent of periodical pub-
lications in El Salvador have an ISSN number. These
statistics on national scientific and literary production
also show a high concentration in the social sciences
and humanities (80 per cent of journals and/or bul-
letins).


b) Patent analysis.


registration of patents by residents is very low, with an


average of eight patents registered annually according
to the Espacenet register or fifteen according to the
rICyT register.


However, in comparative terms, the country is better
placed than the other Central American countries.
El Salvador has a higher annual average of patents
granted to residents and a better ratio of these to total
patents granted, with a coefficient of invention (patents
applied for by residents in relation to the population)
only bettered by Costa rica.


It should be noted that while the inventors who patent
their inventions live in El Salvador, the holders of the
operating rights are essentially foreign companies.
Only 16 per cent of registered patent holders are
Salvadorian.


The principal classes of patents are in medical or
veterinary science (13 per cent of all patents).


Chapter II (section D) provides a more extended sum-
mary of the results and Annex D presents the method-
ological details of the study together with the results
obtained.


c) Technology balance – Balance of royalties and
licence fees


A country’s technology balance measures “the amount
of a country’s income from the export of technical
knowledge and services, while indicating a country’s
competitive position in the international knowledge
market.”23


The technology balance comprises, on the one hand,
income from the sale of national technology abroad
and, on the other, payments for the acquisition of
foreign technology.


In order to facilitate international comparisons and
given that there are no sources of information in a
sufficiently broken down form to cover the components
of the technology balance suggested in the Manual of
Santiago (rICyT 2007), the analysis is based only on
the balance of royalties and licence fees.


El Salvador, like the other Central American countries,
pays out much more than it receives in royalties and
licence fees and has recorded significant increases in
payments under this heading (Figure 20). Nevertheless,
El Salvador seems to bring in comparatively more
in royalties and licence fees than the other Central
American countries (except Guatemala).




23Chapter I: GENErAL bACkGrOUND OF SCIENCE, TECHNOLOGy AND INNOvATION IN THE ECONOMy OF EL SALvADOr


3. Innovation activities and their impact
The design of innovation policies requires detailed
information on innovation activities and processes to
explain how these processes emerge and develop.
This requires detailed information on the factors which
induce companies to undertake innovative activities
and the main obstacles that they face. It also requires
information on the type of cooperation that exists
between different economic agents and the type of
innovation in which they engage in the country, and
the impact of this innovation in terms of sales, exports
and patents.


El Salvador does not have systematic information on
the innovation activities undertaken by companies in
the country24. This is a major weakness in the ability to
design and evaluate innovation policies.


In Latin America, there is ample experience of devel-
opment and conduct innovation surveys, although
they have often proved to be sporadic. Carrying out
an innovation survey requires considerable resources
and statistical know-how. In addition, it is desirable for
innovation surveys to be carried out on a regular basis
so as to be able to evaluate the impact of policies and
programmes on innovation. For these reasons, inno-
vation surveys are often carried out by national sta-
tistical offices, in El Salvador’s case, the Directorate
General of Statistics and Censuses (DIGESTyC). In
this regard, it will be useful to continue to explore the


possibility of DIGESTyC carrying out the first national
innovation survey. The Network of Science and Tech-
nology Indicators (rICyT) can offer training in carrying
out such surveys.


The analysis presented on the context and state of
science, technology and innovation in El Salvador
highlights some of the country’s principal weaknesses.
On the one hand, there is the fragile economic
performance which will be hard to sustain in the long
term without substantial increases in productivity. On
the other, the lower levels of investment in education,
sciences, technology and innovation give cause for
concern, as do the inconsistencies in this expenditure
where, for example, much of the research has been
directed to social sciences and humanities.


It is clear that the development of productive capaci-
ties in El Salvador will require heavy investment in ed-
ucation and training of human capital, diversification
of production to knowledge intensive activities and the
development of technological capacities to reduce ex-
ternal and internal productivity gaps. To achieve that, it
will also be necessary to foster national awareness of
the importance of STI and reach a consensus on the
most appropriate mechanisms to promote it. The fol-
lowing chapters seek to support the development of
this awareness and consensus through a diagnostic
of the national system of innovation in El Salvador and
how it functions, followed by a series of recommenda-
tions.


Figure 20. Royalties and licence fees (payments and receipts), various Latin American countries, 1995-2008
(in millions of dollars at current prices and current exchange rate)


Source: UNCTAD, based on UNSD COMTRADE Data, 2010.


Costa Rica
Payments


Costa Rica
Receipts


El Salvador
Payments


El Salvador
Receipts


Guatemala
Payments


Guatemala
Receipts


Honduras
Payments


Honduras
Receipts


Panama
Payments


Panama
Receipts


1990 1995 2000 2005 2008


0


10


20


30


40


50


60


70




24 Science, Technology and Innovation Policy Review - El Salvador


noTES
1 There are no reliable data, but it is estimated that some 3 million Salvadorians live abroad, of whom 2.5 million are in the


United States. Estimates by the Ministry of Foreign relations (see Ministry of Foreign relations 2010 and International
Organization for Migration (www.iom.int/jahia/Jahia/el-salvador).


2 The under-employment rate measures the volume of unemployment [invisible (workers who work 40 hours or more and
receive an income lower than the established minimum wage) and visible (workers who, not of their own choice, work less
than 40 hours per week)] in the economically active population over a given period of time.


3 For further details, see UNDP (2010 and 2008), UNCTAD (2010).
4 In 2009, family remittances, despite being affected by the economic crisis, amounted to 3,465 million dollars and


accounted for 16.4 per cent of GDP.
5 An IMF study shows that 80 per cent of remittances are destined for consumption while only 15 per cent of remittances


were destined for education and health, and five per cent for investment and saving (Cáceres and Saca, 2006).
6 With the exception of Nicaragua which, in absolute terms, invests less.
7 based on data from the Central reserve bank of El Salvador.
8 For further details, see UNCTAD (2010).
9 based on Foreign Direct Investment database, UNCTAD.
10 The Global Competitiveness report places El Salvador in 44th place in terms of infrastructure, only behind Chile (24th


place).
11 ECLAC (2010).
12 This budget does not include the two priority programmes established in the Five-year Development Plan 2010-2014.
13 Assessment of learning achievements in basic education carried out every three years.
14 Test of learning and aptitudes for secondary school leavers, carried out annually.
15 Average = 500 points. El Salvador: Mathematics fourth grade = 330/ Eighth grade = 300; Sciences Fourth grade = 390


/ Eighth grade = 387.
16 Global Education Digest (2010).
17 MINED report (2010).
18 MINED information bulletin available at www.mined.sv, uploaded on 18 February 2011.
19 Over 50 per cent of postgraduate students are pursuing studies in these two areas).
20 For example, in 2009, 72 homicides were recorded for every 100,000 inhabitants, while the global annual average is


estimated at 9 homicides for every 100,000 inhabitants (UNDP 2010b).
21 That is, those that dedicate over 80 per cent of their time to research activities.
22 That is, “systematic activities which are closely concerned with the generation, advancement, dissemination and


application of scientific and technical knowledge in all fields of science and technology. These include such activities as
r&D, scientific and technical education and training and scientific and technological services” (UNESCO, 1978).


23 Manual of Santiago (rICyT, 2007).
24 In El Salvador, no national innovation survey has been carried out.




The components of the National
System of Innovation of El Salvador




26 Science, Technology and Innovation Policy Review - El Salvador


Fundamental Function Local Function Dimension of Recursion


Immediate reaction Production and execution Executing system


Immediate and long-term reaction Regulation Link between both systems


Immediate and long-term reaction Management and control Link between both systems


Long-term reaction Foresight Policy system


Long-term reaction Cohesion Policy system


Source: UNCTAD.


Table 1. Functions and dimensions of sustainable systems


A. INTRoducTIoN


This chapter describes the components of the National
System of Innovation (NSI) of El Salvador, based on
the principal functions which characterize any system
and which are explained in this introduction. This
descriptive chapter will enable the elaboration, in
Chapter III, of a diagnostic of El Salvador’s NSI and of
a series of recommendations to strengthen it.


There are many definitions of national system of
innovation1, but all highlight the existence of a series
of actors, public and private, whose activities and
interaction create and disseminate new technologies.
The approach taken by this review is based on a broad
meaning of these definitions with certain more detailed
perceptions (included in Annex B) which make this
approach more relevant to the conditions in a country
where the NSI is emerging. It is important to bear in mind
that the concept of national system of innovation must
be seen as a reference framework which represents
and helps to explain a complex reality. Two possible
purposes derive from this approach. One is to serve
as an analytical method to approximate the functioning
of a nation’s productive system, from the viewpoint
now called the knowledge economy. In other words,
understanding the capacities of national production
in terms of the convergence of a series of economic,
social and scientific-technological processes intended
to generate, disseminate and apply knowledge to the
benefit of society, i.e. generate innovation.2 Secondly,
the NSI framework has the purpose of contributing
to the design and implementation of specific plans,
programmes and policies aimed at improving the
functioning of the national productive system, with a
view to making it more competitive and thus to tackle
the challenges involved in the current dynamic of the
global economy.3


From the foregoing, two important considerations can
be derived to be used in this reference framework:


a) The necessity and usefulness of distinguishing two
dimensions of the operation of national systems
of innovation: (i) execution, which is how various
economic and social agents or actors converge
in the generation, diffusion and application of
knowledge; and (ii) policy, which is how public
policies facilitate, regulate and promote the
harmonious functioning of the agents involved in
innovation processes.


b) The policy dimension of the NSI approach includes
or substitutes the traditional separation between
industrial policies4 and science and technology
policies, which means that when there is a reference
to innovation policies, what is envisaged is the
systemic interaction between science, technology
and industry in generating economically useful
knowledge.5


Thus, innovation policies and their interactions with
part of the economic system can be interpreted as
forming a system which, to be sustainable6, must fulfil
two fundamental functions due to the dynamic of their
processes: immediate reaction and long-term reaction
to events in the environment. These fundamental
functions are exercised by two subsystems – the
executive subsystem (productive and innovative in
the true sense) and the policy system – which operate
in distinct hierarchical dimensions. These, in turn,
fulfil five local sub-functions: production, regulation,
control, foresight and cohesion (Table 1).7


The first refers to the production of that which the
system regards as an objective, which at the same
time allows it to exist – in this case the generation and
exploitation of knowledge for the benefit of society.
As there can be various entities responsible for this
production, the second function is to regulate or
coordinate them. The third function controls the flow
of resources, monitors performance and makes the
necessary corrections to ensure that system fulfils its
objectives. The fourth function concerns the vision of




27Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


the future and the determination of strategies. The
fifth dictates the guiding polices which enable the
cohesion of the system.


B. GovERNANcE of
ScIENcE, TEchNoloGy
ANd INNovATIoN (STI).
fuNcTIoNS of cohESIoN
ANd foRESIGhT – PolIcy
SySTEm8


In the republic of El Salvador, there is no body at
present which governs the entire system of science,
technology and innovation policies. It would be logical
for its governance to rest ultimately with the presidency
of the republic and the bodies which support the
executive, namely the Technical Secretariat of the
presidency and those ministries whose functions
are relevant to STI activities,9 particularly those of
Agriculture and livestock, Economy and Education.10


Each of these bodies has various interactions with
other agents which more particularly design and
implement specific plans and programmes, or even
execute activities designed to promote STI (Figure 1).


Such is the case of the Technical Secretariat of the
presidency, which was in charge of the elaboration
and approval of the Five-year development plan
2010-2014 through the Economic and Social Coun-
cil; the ministry of Agriculture and livestock, with the
National Centre for Agriculture, livestock and For-
estry Technology (CENTA) answering directly to it; the
ministry of Economy, which designs and implements
concrete measures to promote innovation through
the vice ministries of Economy (Support Unit for the
integral export promotion strategy) and Trade and In-
dustry and their Quality and productivity, productive
Chains, Export development (FOEX), and Innovation
and Technological development directorates; and
the ministry of Education which, through the recently
created vice ministry of Science and Technology, pro-
motes actions in favour of scientific and technological
development.


more specifically, from the legal and regulatory view-
point, the National Council for Science and Technol-
ogy (CONACyT) is the higher authority with respect
to scientific and technological policy11. Under the Act
which created it, its mission consist of “Formulating,
directing, coordinating and continuously disseminat-
ing national polices on science and technology, aimed
at the economic, social and environmental develop-


Source: UNCTAD.


Figure 1. The principal government bodies involved in the system of innovation policies


Vice Ministry of Trade
and Industry


Vice Ministry of Economy


Vice Ministry of Science
and Technology


Economic and Social Council


CONACYT


Directorate of Productive Chains


Directorate of Productive Export
Development


Directorate of Quality and Productivity


MINISTRY OF AGRICULTURE


MINISTRY OF ECONOMY


MINISTRY OF EDUCATION


TECHNICAL SECRETARIAT
OF THE PRESIDENCY


Directorate of Innovation and
Technological Development


Support Unit for the Integral Export
Promotion Strategy




28 Science, Technology and Innovation Policy Review - El Salvador


ment of the country”. In order to fulfil it, CONACyT was
assigned the following roles:
• To formulate and direct national scientific and tech-


nological development policies and programmes,
• Advise the Government of the republic on invest-


ment programming and budget preparation of insti-
tutions which receive state funding for scientific and
technological activities;


• Execute the National Scientific and Technological
development programme through all the research
centres and academic institutions whose activities
fall within the fields of science and technology;


• Formulate in coordination with the ministry of plan-
ning and Coordination of Economic and Social
development, on the basis of national scientific,
technological and socio-economic development of
objectives, policies on international technical assis-
tance and foreign financial cooperation for science
and technology;


• manage and administer financial resources and
national and international technical assistance in
support of the National Scientific and Technological
development programme;


• promote activities to extend the frontiers of
knowledge, by fostering the training of scientists
and engineers, education, advanced training and
diffusion of science and technology;


• direct and coordinate the activities and execution of
policy in standardization, metrology, verification and
certification of quality;


• Ensure the strengthening of academic institutions
involved in science and technology;


• drive the establishment of a legal framework relating
to science and technology.12


CONACyT is precisely one of the bodies undergoing
a process of transformation. Until mid-2010, it was
an autonomous institution related to the executive
through the ministry of Economy. Now, its functions
related to the promotion of science, technology and
innovation are being transferred to the vice ministry
of Science and Technology, to which it will continue
to be attached with the same name. In addition, the
functions in the quality sphere will be fulfilled as part
of the Salvadorian Quality and productivity System, by
five autonomous entities:
• The National Quality Council, the umbrella body for


the system;
• The Salvadorian Standardization Agency (OSN);
• The Salvadorian Technical regulation Agency


(OSArTEC);


• The Salvadorian Accreditation Agency (OSA);
• The Centre for metrological research (CIm).13


Also worthy of mention is the Innovation promotion
Group (GpI), a multisectoral group established in may
2005 to foster innovation activities.


The goals of the Innovation promotion Group include:
- Creating a unified, integrated effort, orchestrated by


representatives of the private, public and academic
sectors, to formulate guidelines for innovation.


- defining the vision, mission and strategic directions
which guide the action of the Group and those who
sign up to the national innovation effort.


- helping to create the necessary conditions to
facilitate the establishment and consolidation of the
national system of innovation.


- Ascertaining, analysing and validating government
and private inputs in this area, as the basis for
analysis and management of the effort.


- Contributing to the identification of strategic
economic activities to focus efforts and identify the
country’s best opportunities.


- Analysing expert opinions and driving initiatives,
projects and actions required by the national reality
to implant the innovation strategy.


- Supporting the promotion and development of the
theme of innovation.


The Innovation promotion Group is a forum for
discussion without any binding function or its own
budget. Currently, the Group has virtually ceased its
activity.


The governance of STI in El Salvador is complemented
by the national polices which are described in the
following section.


1. National Science, Technology and
Innovation Policy, 2006–2030


Chronologically, one of the most recent national policy
documents on STI is the one prepared and approved
by the National Council for Science and Technology in
2006, updating the previous policy which dated from
1997 (CONACyT 2006). It is structured on the basis
of a global framework, (shown in Figure 2), which
sets out the general vision of the country centred
on social wellbeing and the contribution of science
and technology to that wellbeing. It also includes 13
proposals which would form and facilitate the global
vision, with a time horizon up to 2030. It should be
mentioned that one of these refers to “the existence




29Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


of a National System of Science, Technology and
Innovation, with functions that would give impetus
to technological and scientific activity in the country,
create multiple links between institutions and social
actors which would encourage the interrelation of
the scientific, technological and productive spheres
[…]”14


The document also includes 21 conditions of factors
necessary to achieve the country’s vision, 13 areas
of knowledge for the development of STI (listed in
Table A.1 in Annex A), 10 objectives and 15 general
policy action lines, as well as the following strategic
components:
• Education and training;
• Scientific and technological information;
• Technology transfer, innovation and development;
• Information and Communications Technologies


(ICT);
• Science and technology aimed at the development


of the country’s regions and zones;
• Science and technology infrastructure;
• Financing of scientific and technological development


and innovation.


Each strategic component consists of a description,
action lines, the respective institutional framework


and the “tools”15 proposed to implement them. It also
identifies CONACyT as the coordinating body and the
Innovation promotion Group (GpI) as the liaison body
between agents and processes of the national system
of STI (SINACTI).


2. The Five-Year Development Plan,
2010–2014 (PQD)


With a much broader scope,16 as it involves a
comprehensive development plan for El Salvador,
the five-year plan is the most recent general policy
document and its purpose is to guide the formulation of
specific policies, including polices on STI (Government
of El Salvador, 2010).


The plan is structured around two strategic objectives:
(i) the introduction of a new growth model of integrated,
sustainable and inclusive development; and (ii) the
entrenching and consolidation of democracy. Naturally,
the guidelines of STI activities belong within the first
objective. The principal guidelines in the Five-year
development plan related to STI are set out in Table A.1
in Annex A. Figure 1 shows the priority programmes
and projects in the Five-year development plan and
Table 2 shows the total costs of these programmes
and projects and the funding gap.


Figure 2. Global framework of the National STI Policy, 2006


Basic principles of the policy on
science, technology and innovation


Favourable national environment
for policy development


Strategic components Strategic guidelines


Lines of action Areas to be stimulated


Vision General objectives
NATIONAL POLICY ON SCIENCE,
TECHNOLOGY AND INNOVATION


Source: CONACYT, 2006.




30 Science, Technology and Innovation Policy Review - El Salvador


Strategic area Overall total (1+2)
Total funding


and management (1)
Total


funding gap (2)


Equity, social inclusion and poverty reduction 2,100 926 1,174


Economic revival 1,579 713 865


Sustainable development 590 544 46


Public security 336 86 250


Special development dimensions 209 52 157


TOTAL 4,814 2,322 2,492


Note: The subtotal autonomous institutions (ISSS, FONAVIPO-FSV, CEL) is 474.7 millions of dollars overall.
Source: Government of El Salvador, 2010.


Table 2. Priority programmes and projects in the Five-Year Development Plan (millions of dollars)


3. National Scientific and Technological
Development Plan


The ministry of Science and Technology has proposed
a National Scientific and Technological development
plan. The reference basis for this plan is as follows:
previous work by CONACyT covering the period 2009-
2030; the Five-year development plan 2010-2014; and
the National research Agenda prepared by the min-
istry of Education through the vice ministry of Science


and Technology.17 The general objective of the plan is
to establish the criteria for scientific and technological
development. Its specific objectives include:
• putting the development of science and technology


as development and innovation tools at the service
of society and sustainable economic development;


• promoting the recognition that r&d are crucial
elements in the generation and appropriation of new
knowledge to help solve development problems;


• making research and development and innovation
a factor to promote and incentivize entrepreneurial
development with social responsibility;


• Educating and training human resources of a number
and quality to form a critical mass of professionals to
generate strategic change for development;


• promoting the visibility of scientific and technological
information, the communication of advances in
science and technology and their use in decision-
making;


• Using ICT to stimulate growth and sustainable
development;


• Establishing mechanisms to allow the coordination
of public and private entities such that science and
technology focus on the country’s development;


• Contributing to the conformation of a science
and technology infrastructure which provides a
favourable environment for the development of STI;


• Contributing to the creation of and search for
financial instruments and incentives available to the
executing agents of the various programmes and
activities for the development of STI.


The plan’s scope of action is based on the National


Source: Government of El Salvador, 2010.


Figure 3. Priority programmes and projects in the
Five-Year Development Plan by strategic area
(percentage)


Equity, social inclusion
and poverty reduction


Economic revival


Sustainable development


Public security


Special development
dimensions


33%


12%


7%
4%


44%




31Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


research Agenda which is linked with the Five-year
development plan through a synthetic matrix which
identifies research strengths in 29 areas and some
156 strategic lines (see Table A.2 in Annex A).18


A main objective of the National research Agenda is
to guide the scientific and technological development
research activities of national and private research
centres.


The management and strategic direction of the plan is
the responsibility of the ministry of Education through
the vide ministry of Science and Technology which
will be supported by its own structure. Its execution
will involve all the centres, institutions, entities and
bodies in the public and private sector and research
and higher education institutions whose activities fall
within the field of STI or which devote part of their
budget and human resources to these activities. For
its part, the research Agenda takes concrete form in
the content of the plan involving 10 programmes and
32 projects (see Table A.3 in Annex A).


4. The comprehensive export promotion
strategy


At the beginning of July 2010,19 the ministry of Economy
launched the export promotion strategy 2010-2014
(mINEC 2010), a document designed to strengthen
activities which drive foreign trade. The strategy is
structured around five pillars to achieve its goals:20


(i) the need to invest in processes which encourage
exports; (ii) the incorporation of innovation in these
processes; (iii) the links between activities involving
foreign trade and the generation of quality jobs;
(iv) strengthening productive inclusion (productive
chains, business partnerships, collaboration, etc.);
and (v) taking advantage of free trade agreements. In
addition, it is intended that the cross-cutting elements
of the strategy will be formed by the integration of
innovation and quality systems.


The document sets out five strategic objectives which
include 16 strategic areas and various action lines,
as described in Table A.4 in Annex 4, from which
21 programmes and instruments are derived. The
strategic areas and action lines of the plan most rele-
vant to STI include a set of action lines to promote the
national system of innovation, including the creation
of five sectoral technological centres, strengthening of
the INvENTA gateway, the promotion of an innovative
culture, identifying resources for innovation, and the
establishment of partnerships.


c. ThE AdmINISTRATIvE
fRAmEwoRk of
ScIENcE, TEchNoloGy
ANd INNovATIoN.
mANAGEmENT, coNTRol
ANd REGulAToRy
fuNcTIoNS – lINk
BETwEEN ThE PolIcy
SySTEm ANd ThE
ExEcuTING SySTEm


In the Salvadorian case, these functions consist of the
implementation of specific programmes and projects
to promote STI activities, and the establishment of
regulations and systems to monitor and control them.
These tasks are carried out by the ministries mentioned
above who essentially participate in the design of
policies through their vice ministries and other bodies
linked to the executive through them (Figure 4). The
most important of them are mentioned below.


1. Presidency of the Republic
Attached to the presidency is the National Commission
for the promotion of Exports and Investment
(CONAdEI), whose functions involve the promotion of
exports and access to foreign investment through its
EXpOrTA and prOESA sections respectively.


2. Ministry of Agriculture and Livestock
One of the components of the Agro-Industrial
Conversion programme has been the National System
of Alliances for Innovation and Technology (SINAlIT),
whose objective was to strengthen the country’s
capacity to engage in agriculture and livestock,
agro-industrial and forestry research and technology
transfer. The primary beneficiaries of this system,
operated by the ministry (2001-2009) with support
from funds of the Inter-American development Bank,
were agricultural and livestock producers and their
organizations, agro-industrial enterprises and others
involved in the agriculture and livestock chain, as well
as entities that generate and provide technological
services, public and private, both national and
international.




32 Science, Technology and Innovation Policy Review - El Salvador


3. Ministry of Economy
The vice ministry of Trade and Industry and its Qual-
ity and productivity (dCp) and Innovation and Tech-
nological development (dIdT) directorates, which,
among other things, operate the Inventa and pixels
programmes, are implementing several programmes
to promote innovation, chiefly through the latter. The
dIdT has the specific objective of facilitating and
strengthening entrepreneurial capacities related to
innovation and technological development and, in
general, to promote entrepreneurship, incubation and
entrepreneurial development, as well as contributing
to improving regulatory, institutional and operational
conditions in both the public and private sphere.


In addition, both directorates promote innovation in
coordination with other entities and programmes of the
ministry of Economy such as the National Commission
for micro and Small Enterprises (CONAmypE), whose
function is to stimulate a range of modern, competitive
and profitable micro and small enterprises worthy of


capital investment, and the directorate for productive
Export development (FOEX), whose mission is to
strengthen the competitiveness of micro, small and
medium-sized enterprises through non-reimbursable
co-financing up to 70 per cent of the total cost of a
specific project related to the development of exports,
quality, alliances, productivity and innovation.


Also under the aegis of the vice ministry, the directorate
General of Statistics and Censuses (dIGESTyC),
coordinates and produces national social and
economic statistical information.


Other autonomous bodies linked to the executive
through the ministry of Economy and which are rel-
evant to innovation activities are the National records
Centre (CNr) whose functions include registration of
intellectual property, and the Salvadorian Investment
Corporation (COrSAIN), responsible for promoting
and developing companies and enterprises dedicat-
ed to industrial activities.


Source: UNCTAD.


Figure 4. The principal government bodies involved in the management, control and regulation systems


MINISTRY OF AGRICULTURE


Vice Ministry of Science
and Technology


MINISTRY OF ECONOMY


MINISTRY OF EDUCATION


Directorate of Innovation and
Technological Development


Directorate of Quality and Productivity


DIGESTYC


Directorate of Productive Export
Development (FOEX)


PRESIDENCY CONADEI
PROESA


EXPORTA


SINALIT


CNR


CONAMYPE


CORSAIN


SIGET


CONACYT


Autonomous bodies


Vice Ministry of Trade
and Industry




33Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


4. Ministry of Education
This ministry has recently taken charge of the
higher Education research Fund (FIES), which is a
mechanism of the Government of El Salvador for the
competitive financing of scientific and technological
projects put forward by accredited and state higher
education institutions (universities, specialized
institutes and technological institutes), seeking to
promote and incentivize capacities for their scientific
and technological innovation, and to promote links
between the academic and productive sectors. In its
first funding round, seven projects were implemented
for an investment of some 410,000 dollars, and in the
second round, six projects were implemented for an
amount of 617,000 dollars.21


In addition, the recently created vice ministry of
Science and Technology will absorb the functions of the
scientific and technological component of CONACyT.
It will be responsible for educational technologies and
technical, scientific and technological education, and
is currently planning actions which sit better in the field
of execution, such as the creation and operation of
research centres in the exact and social sciences and
technology parks.


5. Laws and regulations
Specifically aimed at STI activities, the only known
legal framework is the above-mentioned Act on
CONACyT, although at the time of writing this review,
it is not known whether the above-mentioned changes
in the government structure are yet in force. There is
a Scientific and Technological development Bill which
is at the examination stage, but at the time of writing
of this document (march 2011) it had still not been
approved. Nevertheless, it does propose a series of
arrangements which already apply in practice. Among
the most important is that the vice ministry of Science
and Technology is the lead agency for science and
technology and responsible for coordinating the
formulation and implementation of national policy
on STI, serving as the basis for the elaboration of the
National plan for Science, Technology and Innovation
mentioned above. The Bill also contemplates:
• The constitution of the National System of Science,


Technology and Innovation (SINACTI).
• The establishment of a National Science, Technology


and Innovation Observatory.
• Actions in the education sector including: (i) modifi-


cation of study programmes to include scientific and


technological education as a cornerstone of educa-
tion; (ii) strengthening of postgraduate studies and
the introduction of a system of scholarships; (iii) ob-
ligation of foreign technology-based companies to
include Salvadorian researchers on their staff; (iv)
creation of research and technological innovation
centres; and (v) establishment of a National System
of researchers.


• Actions to promote science and technology.
• Establishment of additional funding on top of the


financing allocated in the education budget of at
least 0.1 per cent of Gdp.


• Strengthening international cooperation in STI.
• Creation of the Fund for Scientific and Technological


development and Innovation (FOdECyT), managed
by CONANCyT, in order to finance research
projects.


• Generation of incentives for the development of STI.


Other legal instruments which influence innovative
activities, essentially by facilitating and stimulating
national and foreign productive investment, include:
the Industrial Free Zones and marketing Act (1998); the
Investment Act (1999); and the International Services
Act (2007), which regulates the establishment and
operation of service parks and centres.


d. oPERAToRS IN ThE
SySTEm of INNovATIoN.
PRoducTIoN ANd
ExEcuTIoN fuNcTIoN –
ExEcuTING SySTEm


The principal agents who, in the case of El Salvador,
make up the production system as such include es-
sentially enterprises, which are the cornerstone of the
generation of innovation, organizations which gener-
ate and disseminate knowledge, the constituents of
the financial sector, and independent bodies which
promote technological development and innovation
(Figure 5).


1. Industry
The industrial structure of El Salvador consists 91.6
per cent of micro-enterprises22, which employ almost
36 per cent of the country’s employed population
(dIGESTyC, 2005). The principal economic activities
relate to manufacturing industry, branches of the




34 Science, Technology and Innovation Policy Review - El Salvador


tertiary sector (chiefly commerce and to a lesser
extent transport and storage services) and the
primary sector, although the latter has been declining
in recent years (see Chapter I, Figure 5). For its part,
the secondary sector, which contributes some 22.5
per cent of gross domestic product, is concentrated
mainly in industrial assembly services (which have


grown enormously in recent years), basic chemicals
and derivatives, branches of the food industry, and
basic and transformed metal products (see Chapter
I, Figure 6).


With regard to capacity for innovation, if we take
patenting intensity as an indicator,23 this is fairly low.


Source: UNCTAD.


Figure 5. The principal agents involved in the system of execution and production


Universities


PRODUCTIVE ENTERPRISES


ASI


CENTA


ITCA


ISEADE


ENA


CAMARASAL


CAMAGRO


BMI


BFA


BH


Chambers and
associations


Centres


Specialized
institutes


Technological
institutes


RESEARCH, EDUCATION
AND TRAINING


PROinnova


AUTONOMOUS SUPPORT
BODIES


INFRASTRUCTURE


FOMILENIO


FIAGRO


FUNDE


FINANCIAL SYSTEM


INSAFORP


FUSADES


Innovation promotion group


General


STI specific




35Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


As can be seen in Annex d, the number of patents
where the inventors live in El Salvador24 is about eight
per year and the majority of them are awarded to
foreign companies which own them. The comparative
data in the same annex also show that the intensity of
patenting is low (Figures d1 and d2).


Complementing this analysis, Figure 6 shows the
low proportion of royalties received by El Salvador
for technology licensing and Figure 7 shows that its
exports of high technology barely reached 100 million
dollars in recent years. Annex d also shows the areas
in which there is greater scientific and technological
capacity, predominantly in medicine and veterinary
science, agriculture and the food industry, and to
a lesser extent in the motor and metal engineering,
organic chemistry and biochemistry.


Although these data may appear discouraging, it is
important to take into account that (according to the
interviews) there have been limited public promotion of
intellectual property, in particular patents. In addition,
the industrial structure described above does not
lend itself to the use of instruments of this kind by
micro and small businesses. Furthermore, interviews


conducted in various companies revealed that on
occasion they carry out r&d activities and even
include innovations in their products and processes,
but without considering it as such and including it in
their financial statements. This means that r&d and
its application in innovations is greater than can be
seen through conventional indicators. Box 1 shows
examples of successful innovations in El Salvador
which are not captured by national indicators. The work
done by these companies includes the acquisition of
technology and activities of imitation and adaptation,
incremental innovations which, while not radical,
have made these companies more competitive and
allowed them to expand, including internationally.
These results show the importance of incremental, not
only radical, innovation.


despite this, innovative activities in the Salvadorian
productive sector are few (see Chapter I, Figures 8
and 9), and are largely confined to the introduction
of improvements which are new to the organizations
through the acquisition of technology. This is influenced
by the structural characteristics of the productive
sector, as micro, small and medium-sized enterprises
generally have less resources for education, training,


Figure 6. Ratio of receipts and payments for royalties and licensing of technology


Te
ch


no
lo


gi
ca


l I
nd


ep
en


de
nc


e
In


de
x


Brazil Costa Rica El Salvador Guatemala Honduras Mexico


1999 2000 2001 2002 2003 2004 2005 2006 2007 2008


0


0.1


0.2


0.3


0.4


0.5


0.6


0.7


Source: UNCTAD, based on World Bank data.




36 Science, Technology and Innovation Policy Review - El Salvador


an innovative culture, infrastructure and financing to
carry out innovative activities internally.


The productive sector also has various industry
organizations which, among other things, fulfil the
functions of representation, advice and training. The
most important among them are described below.


Salvadorian Association of Industrialists (ASI)


The ASI is a group of some 500 essentially small
and medium-sized enterprises, including industry
associations in the textiles and dress-making industry,
plastics, pharmaceuticals, paper and cardboard,
footwear and metal engineering. It carries out actions


Figure 7. High technology exports (logarithmic scale)


1999 2000 2001 2002 2003 2004 2005 2006 2007 2008


Mexico


Brazil


Costa Rica


El Salvador


Guatemala


Honduras


Cu
rr


en
t d


ol
la


rs


1


10


100


1,000


10,000


100,000


1,000,000


10,000,000


100,000,000


1,000,000,000


10,000,000,000


100,000,000,000


Source: UNCTAD, based on World Bank data.




37Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


Box 1. Examples of successful innovations in El Salvador not captured by national indicators


Laboratorios Arsal S. A. de C. V.


This family company, with a long history in El Salvador, has a wide range of medicines for human and veterinary use which
sells in the domestic and Central American market (and is beginning to make inroads in South America).


It has a small r&d department, like other local pharmaceutical laboratories, seeking new markets through competitive
product knowledge and research and analysis of patents. Once products with potential have been identified, the internal
capacities to develop and manufacture it are analysed, and if the outcome is positive, the process of developing the
compounds starts.


during the engineering work of reconditioning and expanding the factory, it was found that there was a need to acquire
various specialized accessories. Given the high cost of such equipment, the engineering team, assisted by consultants
and small firms, developed and supervised the manufacture of fibre-glass doors and walls and pharmaceutical lamps
for the installations. These product and process innovations were completed outside the r&d department and were not
included in the accounts and r&d activities.


The Coffee Cup26 and Quality Grains.


These two companies are managed by the well-known Salvadorian businessman, Samuel Quirós, who also has a long
background in the motor industry. The Coffee Cup is a chain specialized in gourmet coffee which in 2002 opened its first
establishment to meet growing local demand. It has concentrated on perfecting the brand from aspects related to the
taste of the coffee blends, to those involving materials and design. For the former, it relies on Quality Grains, a coffee
producer with intensive export activities.


The exploitation of the value chain, the emphasis on product quality and the special attention paid to standardization
of processes in the distribution phase has facilitated the sale of The Coffee Cup franchises in El Salvador, Guatemala,
honduras and Costa rica. Towards the end of 2010, it opened its first outlet in Austin, Texas, after several years trying
to enter the United States market, and it hopes to open a further ten establishments in the course of 2011, to add to its
more than 30 outlets.


Source: UNCTAD.


Figure 8. Indicators of innovation under the World Banks’s Knowledge Assessment Methodology (KAM)


FDI outflows as % of GDP, 2003-07


FDI inflows as % of GDP, 2003-07


Royalty and license fees payments (US dollar/pop.), 2007


Royalty and license fees receipts
(US dollar/population), 2007


Royalty payments and receipts
(US dollar/population), 2007


Science and engineering enrolment ratio (%),
2007


Science enrolment ratio (%), 2007


Researchers in R&D / Million people, 2006


Total expenditure for R&D as % of GDP, 2006


Manufacture trade as % of GDP, 2007


University-company research collaboration, 2008


Science & engineering journal articles / million people, 2005


Science & engineering articles with foreign coauthorship (%), 2005


Average number of citations per science & engineering article, 2005


Availability of venture capital, 2008


Patents granted by USPTO /
Million people, average 2003-07


High-tech exports as % of manufacture exports, 2007


Private sector spending on R&D, 2008


Firm-level technology absorption, 2008


Value chain presence, 2008


Capital goods gross imports(million USdollars), 2003-07


Capital goods gross exports (million USdollars), 2003-07


0


2


4


6


8


10


Costa RicaEl Salvador Panama


Note: Data normalized by reference to the Latin American group of countries.
Source: UNCTAD, based on World Bank data.




38 Science, Technology and Innovation Policy Review - El Salvador


to promote the establishment of industrial policies in
El Salvador and also provides a series of services to
businesses.


The Agricultural and Agroindustrial Chamber of El Salvador
(CAMAGRO)


CAmAGrO is a private not-for-profit association. Its
prime purpose is to bring together all natural and
legal persons operating in agriculture and livestock,
forestry, fishing, agro-industrial and related activities.
Its general strategy is to design a medium and long-
term agricultural policy and take the lead in specific
strategies to achieve their adoption by governments,
and urge the relevant authorities to implement
agricultural policy.


Chamber of Commerce and Industry of El Salvador
(CAMARASAL)


CAmArASAl is a not-for-profit association which pro-
vides services and carries out productive activities
for the benefit of enterprises, such as advice on busi-
ness, export procedures, training, market intelligence,
business contacts, etc. Its mission is to promote and
defend the system of free enterprise, stimulate enter-
prise development with social responsibility, lead ac-
tions and provide services to promote its members’
competitiveness and protect their rights. It has various
training programmes.


2. Organizations which generate and
disseminate knowledge


research activities in El Salvador are essentially carried
out in the CENTA and the National Centre for Fisheries
development (CENdEpESCA) and some of the higher
education institutions: universities, specialized institutes
and technological institutes. There are 24 universities in
the country (one public), 9 specialized institutes (four
public) and 6 technological institutes (three public)
(mINEd 2011)27; all of them are duly authorized,
although only 8 universities have accreditation.28
however, according to the CONACyT register of
researchers, only 11 universities and 5 institutes carry
out research activities.29


human resources devoted to research are rather small
(see Chapter I). According to data of the register of
National Scientific researchers of CONACyT,30 the
total number of researchers comes to 502, of whom
32 have doctorates and 224 master’s degrees. In
2009, 134 researchers were listed (16 with doctorates
and 32 with master’s degrees) in higher education
institutions (CONACyT 2010). These statistics on
researchers in higher education institutions show major
inconsistencies between the number of researchers
and the level of r&d investment in each subject area
(Figure 9). 40 per cent of these researchers are in the
agricultural sciences, but expenditure on r&d in this
area accounts for only 5 per cent of total spending. In


Figure 9. Inconsistencies between the number of researchers and investment in R&D by subject area – Higher education
institutions, El Salvador, 2009


Medical sciences


Engineering and technology


Exact and natural sciences


Humanities


Social sciences


Agricultural sciences


0%


10%


20%


30%


40%


50%


60%


70%


80%


90%


100%


R&D expenditure


29%


10%


15%


5%


31%


9%


Researchers


21%


3%
6%


40%


23%


6%


Source: CONACYT (2010).




39Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


higher education institutions, there is a high proportion
of researchers in the social sciences and humanities
(29 per cent) and relatively high expenditure on r&d in
those areas (41 per cent) (CONACyT 2010).


As regards financial resources dedicated to scientific
and technological activities (r&d, education in
science and technology and science and technology
services), total expenditure by higher education
institutions in 2009 was 193 million dollars, of which 8.2
per cent relates to r&d and 88 per cent to scientific
and technological education. This means that total
expenditure on r&d as a percentage of Gdp was 0.08
per cent in 2009 (CONACyT, 2010). This percentage,
although understated because it does not include r&d
investment carried out by the private sector or research
centres, still represents very low investment.


With regard to scientific output, a bibliometric study
carried out expressly for this review (see Annex F)
identified 420 publications in indexed journals to which
authors resident in El Salvador contributed;31 of the
total number of articles, in 186 they appear as the lead
author, which in recent years means an average of four
articles per year in this type of medium. In absolute
terms, the number of articles is the lowest in Central
America (see Figure F3), but if historic information on
investment in r&d and human resources dedicated to
science and technology, actual productivity could be
estimated with precision. Collaboration in research is
primarily with the United States and, to a lesser degree,
with Spain and the neighbouring countries of Central
America (honduras, Guatemala and Costa rica).


The research topics which have been the subject of
the most intensive publications relate to public, envi-
ronmental and occupational health, especially tropi-
cal medicine, dermatology, infectious diseases and
oncology. There is also a wide-ranging output in plant
sciences and their pharmacological applications and
biochemical support. Other areas which stand out are
ecology, zoology, entomology, veterinary sciences and
earth sciences.


Concerning the impact of these articles on the scientific
community, the main areas, taking into account all the
articles, are immunology, research into the respiratory
system, meteorology and atmospheric sciences, and
food technology. On the other hand, taking into account
only those articles where the lead author is resident in
El Salvador, the publications with the greatest impact
concern oncology, orthopaedics, health policy and
services, paediatrics, andrology, nutrition and ophthal-
mology. Finally, the research bodies with the greatest
output are, in first place, the University of El Salvador,


followed a long way behind by the Central American
University, the Centre for diseases Control and preven-
tion, CENTA and the US department of health and hu-
man Services. however, considering the impact of the
publications, research by Salvadorian organizations
has little impact, with the exception of rosales hospi-
tal.


Box 2 shows some of the contrasting aspects of
research in El Salvador. Given the lack of systematic
information on research activities in El Salvador, Box 2
only shows a few examples, collected during the field
work and through a survey carried out by the directorate
of Innovation and Technological development.
Although they cannot be considered representative of
the research sector and higher education, they give
some idea of the efforts to develop capacities, as well
as the weaknesses of some of the principal institutions
in the sector.


Concerning the quality of higher education, it is difficult
to generalize, as there is evidence of differences
between institutions (mINEd 2009).33 however, the
national statistics are useful in obtaining an overview of
the country. According to these statistics, El Salvador’s
performance is inconsistent and could be described
as average (Table 3). For example, there is a high
percentage of “class time only” teachers34 (51.87 per
cent) and only a small percentage of the budget is
used for scientific research (1.49 per cent).


If, in addition, we use indicators derived from external
sources, the results are still average and, in some cas-
es, low and with considerable need for improvement
(see Table 4, Figure 10).35 In particular, major weak-
nesses emerge in the rates of enrolment in secondary
and tertiary education and the quality of teaching, es-
pecially in the sciences. To complement the informa-
tion, several of the interviews conducted in enterprises
revealed dissatisfaction on the part of the productive
sector with the quality and content of several scientific
and technological courses, which were described as
out of date and inadequate to train professionals who
could take their place in industry without the need for
additional training in the company.


Included among the organizations which disseminate
knowledge is the Salvadorian vocational Training Insti-
tute (INSAFOrp). This is a government institution re-
sponsible for the management and coordination of the
National vocational Training System. It involves public
or private actions offering professional and technical
training, and imparting or enhancing the practical vo-
cational knowledge, aptitudes and skills necessary to
carry out productive work appropriate to the socio-




40 Science, Technology and Innovation Policy Review - El Salvador


Box 2. Contrasting aspects of research in El Salvador


Resources
The University of El Salvador (UES), given its public character, is undoubtedly the institution with the greatest volume of
human and financial resources and facilities for research. Nevertheless, there is an imbalance between these and the
fact that it has more facilities than researchers. One example of this is the Centre for Scientific research and health
development (CENSAlUd), which has excellent facilities (a three-storey building and several well-equipped laboratories)
but only has 9 researchers and does not have sufficient technical staff to service the laboratories properly.


With regard to private institutions, these generally allocate only a small proportion of their income to r&d activities. The
Autonomous University of Santa Ana is remarkable in that it allocates almost 40 per cent to r&d together with don Bosco
University (UdB) which allocates almost 20 per cent of its resources to the provision of technological services (see Annex
E, Figure E.1). In addition, UdB continues to increase its technological research work, with the recent creation of the
institutes for research in energy and electronics. Among the technological institutes, the Central American Technological
Institute (ITCA-FEpAdE) also has advanced facilities for teaching and research in technological areas.


With respect to human resources, according to the small sample of universities available, the average teaching staff with
a first degree, engineering diploma or less is 60 per cent. As can be seen from Figure E.2, only the UASA, with 55 per
cent of staff with doctorates in medicine or odontology, and the José Simeón Cañas Central American University (UCA),
with almost 8 per cent of doctors of philosophy, stand apart (Figure E.4).


Productivity
research productivity is generally very low, if we rely on the indicator of the number of publications indexed in international
databases. As shown by Figure F.15 in Annex F, the total number of this type of publication was 23 during the last decade,
which represents about 0.5 articles per year for every 100 researchers, while according to the latest rICyT data,32 the
average for latin America is 20.1 articles for every 100 researchers. At least, the number of publications shows an upward
trend in universities such as UCA and the Alberto masferrer Salvadorian University, and a considerable revival in the
UES.


One aspect which attracted attention during the field study is that the UES does not have a procedure for monitoring
and evaluation of current research. It merely allocates budgets to projects which are sometimes subject to some sort of
evaluation process, but there do not appear to be deadlines for their duration or mechanisms for evaluating the results.


Links with the productive sector
Activities involving collaboration with the productive sector are still very limited in El Salvador. They are basically confined
to a few cases of establishing contact with enterprises to adapt their study programmes to the needs of certain industries
and providing technological services. In this aspect, ITCA-FEpAdE and UdB stand out. On the other hand, despite the
fact that UES has an internal department dedicated to the transfer of knowledge and technology, it does not report any
specific activity in this regard, with the exception of information gathered in the field which suggests that the Centre for
research into Nuclear Applications generates a good level of resources from the provision of services.


The private sector is somewhat sceptical about the quality of higher education, which straightaway represents a major
obstacle to the willingness of enterprises to initiate any kind of more advanced collaboration with universities, such as
commissioning research projects to solve technological problems or develop new processes or products.


Inter-institutional collaboration
This is an aspect of which there is practically no experience in the higher education institutions of El Salvador or other
research bodies, as no examples were found of research projects involving several institutions. On the contrary, it was
found that different organizations, the recently created National Centre for Scientific research of El Salvador, CENSAlUd
and rosales hospital, are carrying out projects on a common subject, Chagas disease. Although the projects do not
overlap and focus on different aspects of the subject, there is no collaboration of any kind between these institutions that
could generate synergies and benefit the researchers and the results of the research.


Source: UNCTAD.


economic devlopment of El Salvador. INSAFOrp is
financed exclusively by employers’ contributions. Its
approved budget for 2010 was 26.1 million dollars (IN-
SAFOrp, 2010). INSAFOrp does not generate income
from the sale of vocational training, or other goods or
services. INSAFOrp does not itself implement train-
ing activities, but contracts third parties to undertake


this work in accordance with its programmes. In 2009,
INSAFOrp trained over 310,000 persons, chiefly in
marketing (34 per cent), administration (20 per cent),
and management (18 per cent). Only 14 per cent were
trained in technology, methods and applications, and
2.8 per cent in computer sciences.




41Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


Indicator Unit 2009 2008


Students per teacher Students 16.17 16.18
Students per full-time teacher Students 48.92 48.22
Number of students per “class time only” teacher Students 31.05 31.27
Percentage of full-time teachers Percentage 33.06 33.54
Percentage of “class time only” teachers Percentage 52.06 51.73
Percentage of teachers with over five years in the institution Percentage 60.37 59.69
Percentage of teachers with technical diploma Percentage 4.39 4.81
Percentage of teachers with university degree Percentage 71.60 73.59
Percentage of teachers with postgraduate qualification Percentage 24.01 21.27
Number of books per student Unit 6.47 8.1
Average number of volumes per book title Unit 1.57 1.99
Students per computer Students 10.96 11.56
Students per Internet computer Students 12.11 12.59
Academic space per student Sq. metre 2.32 2.43
Recreation space per student Sq. metre 10.17 10.33
Percentage of budget allocated to teaching staff salaries Percentage 48.31 47.02
Percentage of budget allocated to administrative staff salaries Percentage 23.47 22.98
Percentage of budget used for scientific research Percentage 1.54 1.56
Percentage of budget used for social projection Percentage 3.55 3.47
Percentage of budget used for books Percentage 0.58 0.5
Percentage of budget used to buy academic equipment Percentage 1.97 1.82
Average annual cost of technical courses Dollars 620.32 607.64
Average annual cost of university courses Dollars 668.92 640.73


Source: MINED 2010c.


Table 3. National higher education indicators, 2008-2009


Figure 10. Education indicators in accordance with the World Bank’s Knowledge Assessment Methodology (KAM)


Adult literacy rate (% age 15 and above), 2007


Costa RicaEl Salvador Panama


4th grade achievement in math (TIMSS), 2007


4th grade achievement in science (TIMSS), 2007


8th grade achievement in math (TIMSS), 2007


8th grade achievement in science (TIMSS), 2007


Quality of science and maths education (1-7), 2008 Gross secondary enrolment rate, 2007


Gross tertiary enrolment rate, 2007


Life expectancy at birth, 2007


Internet access in schools (1-7), 2008


Public spending on education as % of GDP, 2007


0


2


4


6


8


10
Average years of schooling, 2000Quality of management schools (1-7), 2008


Note: Data standardzed by reference to the Latin American group of countries.
Source: UNCTAD, based on World Bank data.




42 Science, Technology and Innovation Policy Review - El Salvador


Indicator Rank out of 139 countries


Health and primary education (Basic requirements)


Quality of primary education 114


Primary education enrolment rate 70


Higher education and training (Efficiency enhancers)


Secondary education enrolment rate 106


Tertiary education enrolment rate 85


Quality of the educational system 121


Quality of mathematics and science education 124


Quality of management schools 79


Internet access in schools 105


Local availability of research and training services 83


Extent of staff training 63


Innovation (Innovation and sophistication factors)


Capacity for innovation 117


Quality of scientific research institutions 133


Company spending on R&D 122


University-industry collaboration in R&D 114


Government procurement of advanced technology products 113


Availability of scientists and engineers 125


Utility patents per million population 90
Source: Schwab, 2010.


Table 4. Indicators of the World Economic Forum on competitiveness related to education


3. Support organizations
Salvadorian Foundation for Economic and Social Develop-
ment (FUSADES)


FUSAdES is a private development, not-for-profit or-
ganization created in 1983 by a group of independent
professionals and entrepreneurs that elaborates pub-
lic policy proposals in the economic, social, environ-
mental and institutional spheres.


FUSAdES has two centres of operations: the Think
Tank Centre and the development Centre. The latter
comprises four programmes: programme to Strength-
en Social Action (FOrTAS), programme of Investment
promotion and diversification of Exports (prIdEX), the
Integral Quality laboratory (lCI) and the programme
for promotion of Technological Innovation in SmEs
(prOinnova).


prOinnova is a programme to support technological
innovation and quality in Salvadorian SmEs, estab-
lished in 2008, with support from the multilateral In-
vestment Fund (FOmIN) of the Inter-American devel-
opment Bank, through the Technological Innovation


project for Food Exporting SmEs of El Salvador.


In addition, the Integral Quality laboratory is a centre
for laboratory services which provides its services to
the agro-food industry and the environmental sphere.
The pioneering laboratory was has the necessary
ISO accreditation to carry out various types of micro-
biological analysis (of food and water) and physical-
chemical analysis of water. It has the capacity to carry
out over 300 types of analysis which allows it to as-
sist enterprises in various aspects of accreditation. It
is estimated that it serves about 700 enterprises per
year, which means receiving 1000 samples and car-
rying out 4000 analyses per month. In addition, it has
lines of collaboration with the prOinnova programme
concerning the evaluation of new products at the de-
velopment stage. Thanks to its volume of work, the
laboratory is totally self-supporting.


Foundation for Agricultural Technological Innovation
(FIAGRO)


The Foundation is a private not-for-profit body whose
basic objective is to stimulate technological innovation
in the agricultural, livestock and agro-industrial activi-




43Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


ties of El Salvador by facilitating access to state-of-
the-art technologies and innovation projects and tech-
nology transfer. Its strategic lines of action include:
• Dissemination of information and development of


specific projects in biotechnology
• Conduct of studies and provision of specific advice


in various fields
• Technical events for technology transfer, education


and training
• Incubation and advice for innovative enterprises in


the agricultural and agro-industrial sector
• Execution of projects to support technological in-


novation in the sector


National Development Foundation (FUNDE)


FUNdE is a non-governmental organization for re-
search, formulation of socio-economic policies, lob-
bying and promotion of development, the principal
target being the most disadvantaged sectors of the
Salvadorian population. The Foundation promotes
social and economic development by stimulating
activities to improve the living standards in the most
needy sectors of the population, the socio-economic
cooperation between the chief actors and decision-
makers, and the sharing and discussion of ideas on
the topic of socio-economic development.


Millennium Fund (FOMILENIO)


The millennium Fund is an autonomous public agency
based on an agreement with the millennium Challenge
Corporation (mCC) to implement a five-year programme
to reduce poverty and achieve economic growth in the
Northern Zone of El Salvador. FOmIlENIO’s capital
consists of the grant of funds by the Government of the
United States of America through the mCC.


The general objectives of the programme are: human
development, productive development and connectiv-
ity. It also incorporates five cross-cutting components:
environment, regional development, gender equality,
transparency and citizens’ participation.


The aim of the productive development project (pdp)
is to convert the Northern Zone into an organized eco-
nomic corridor which produces goods and services,
agro-food products and tourist services. It includes
specialized services and technical assistance pro-
grammes for entrepreneurial development, infrastruc-
ture and productive equipment, and investment and
credit, focusing on the establishment of six productive
chains. The principal beneficiaries comprise agricul-
tural, livestock and forestry producers, and agro-in-


dustrial producers and services in the Northern Zone.
The provides production and business services, in-
vestment services, and financial services.


4. Financial system
Multisectoral Investment Bank (BMI)


The multisectoral Investment Bank is a public credit
institution, with legal personality and its own capital.
Its objective is to promote the development of private
sector investment projects.


The BmI offers medium and long-term funds which are
granted through local financial institutions supervised
by the Superintendency of the Financial System (SSF).
It is also responsible for providing credit to financial
institutions for provision of these resources to final
users.


The Five-year development plan strategies include
the configuration of a financial system to promote
development, comprising the Agricultural promotion
Bank, the Banco hipotecario (mortgage and loans)
and the BmI, in which the BmI will become the National
development Bank of El Salvador .


Banco Hipotecario (BH)


The Banco hipotecario de El Salvador S.A. was found-
ed in 1935 with the incorporation of major agricultural
and livestock associations. The institution remained
under the control of private shareholders until 1992,
when the State became the principal shareholder. The
Bh provides specialized support for small and medi-
um-sized enterprises. On 31 march 2010, Bh had to-
tal assets and liabilities of 431 million dollars.


The Banco hipotecario focuses its work primarily
on the country’s productive sectors, including the
agricultural sector (which represents 18 per cent of
the loan portfolio), the services sector (18 per cent)
and the commercial sector (17 per cent).


Agricultural Promotion Bank (BFA)


The BFA was established in 1973 as an official credit
institution and a decentralized agency of the ministry
of Agriculture and livestock. It is managed by the State
and the private sector. Its objectives are to provide for
the financial needs of micro, small and medium-sized
businesses in the agricultural and agro-industrial
sectors.


The BFA sources its funds from deposits by the public,
the BmI and the Central American Bank for Economic




44 Science, Technology and Innovation Policy Review - El Salvador


Integration. during 2009, the total amount of credit
disbursed by the bank was 81 million dollars. The
principal productive activities financed were staple
food production, cattle and crops for export.


5. Collaboration and links between
agents


With regard to standardization and regulation, there
is good collaboration and contacts between public
sector bodies and organizations that generate
and disseminate knowledge. Examples are the
composition of the executive board of CONACyT,
and the validation of the national policy on science,
technology and innovation, the wide consultation for
the elaboration of the Five-year plan, and various
other forums for contact in which trade associations,
the academic world, independent organizations and
the government sector discuss and determine matters
related to STI activities.


Nevertheless, it is important to mention (probably due
to the lack of a homogeneous vision of the process
of innovation and its repercussions on science and
technology and industrial policies as a whole), there is
a lack of coordination and alignment between public
sector bodies themselves. This hampers the genera-
tion of synergies in policy actions, which is crucial, es-
pecially when available resources are scarce.


As regards the functions of execution and production,
links between agents are very rare. On the one hand,
public funds allocated to STI activities are very small
and do not always promote collaboration between the
academic world and industry. On the other, the view
of links held by the academic and productive sector
is still somewhat narrow, almost exclusively taking the
form of the flow of graduates into the labour market.
Thus, enterprises consider that a good linkage consist
of higher education institutions providing them with
properly trained staff, and several higher education
institutions make somewhat similar assumptions and
establish relationships and even agreements to fulfil
the expectations of certain enterprises.


Although this type of cooperation is positive (provided
that it does not mean the educational task of higher
education institutions is merely to provide labour for
the labour market), it is still confined to a very narrow
spectrum within the range of potential linkages (Figure
11). With the exception of CENTA, which by the nature
of its mission and work is heavily involved in transfer
of technology36, very little of the results of higher
education institutions which carry out research are


transferred to industry and, of course, no participation
in collaboration activities with the greatest impact on
national innovation.


This situation should not be attributed to lack of action
by higher education institutions, as the key actors in
innovation are enterprises. If the latter do not ask for
knowledge and technology, the facilitating activity
of the public sector and the executing capacity of
research bodies count for little.


Following a description of the components of the
national system of innovation and its linkages, the
principal policy instruments use in El Salvador are
described below.


E. PRINcIPAl INSTRumENTS
of INNovATIoN PolIcy


This section describes the principle instruments of
STI policy in El Salvador, using a classification based
on the nature, characteristics or mechanisms for
the utilization of these instruments (i.e. whether the
measures are direct or indirect and also the type of
financing involved). It should not be forgotten that for
these measures to work properly, it is also necessary
to have a series of environmental conditions (Figure
12) which were amply reviewed in Chapter I.


1. Direct financing measures
Public research
This is carried out through CENTA, CENdEpESCA and
the university and public education institutes mentioned
above. As indicated above (Table 4), however, resourc-
es destined exclusively for research are very slim.


Training of human resources
Although at very low levels, the Government of El Sal-
vador operates funds for scholarships in higher edu-
cation: the FANTEl scholarships for higher education
and the scholarship fund of the Central reserve Bank,
both of which are managed and implemented by au-
tonomous private bodies (the Salvadorian Foundation
for Integrated Education and the Business Education
development Foundation, respectively). INSAFOrp
also provides scholarships for agronomic studies in
the National School of Agriculture.


R&D&I financing funds
The funds identified are the FIES, FOEX–FONdEprO
and FOmIlENIO, although the latter is managed




45Chapter II: ThE COmpONENTS OF ThE NATIONAl SySTEm OF INNOvATION OF El SAlvAdOr


Source: UNCTAD.


Figure 11. Range of collaboration activities and linkages


MORE FREQUENT
/LESS RISK


LESS FREQUENT
/MORE RISK


MORE TRADITIONAL
ACTIVITIES


LESS TRADITIONAL
ACTIVITIES


KNOWLEDGE INCORPORATED
IN INNOVATIONS


CUMULATIVE
KNOWLEDGE


TACIT
KNOWLEDGE


Inflow of graduates
to industry


Continuing education


Seminars and conferences


Publications


Co-publications


Formal consultancy and
provision of services


Mobility of
researchers


Informal consultancy


Contract research


Joint research


Licensing of
technology


Joint
laboratories


Incubation
and spin-offs


Links at
postgraduate level


Source: UNCTAD.


Figure 12. Environmental conditions for the operation of STI policy instruments


COMPETITION
POLICY


INFRASTRUCTURE


MACRO-ECONOMIC
CONDITIONS


EDUCATION
SYSTEM


INDUSTRIAL
REGULATIONS


AND STANDARDS


INTELLECTUAL
PROPERTY


STI POLICY
INSTRUMENTS




46 Science, Technology and Innovation Policy Review - El Salvador


autonomously. There are other funds of autonomous
organizations such as those managed through
prOinnova, but they cannot be included as policy
instruments of the Government of El Salvador.


Support for scientific infrastructure
This is provided through resources from the annual
budget for public research centres and higher educa-
tion institutions. There is no strategy or multi-annual
plan for the development of scientific infrastructure.


2. Indirect regulatory measures37


Intellectual property
The body responsible of managing intellectual prop-
erty, as well as other records, is the National records
Centre. This body has ISO quality certification, and its
procedures have been well automated and digitized
since 2008, although it does not have on-line search
facilities, and it carries out its work in accordance with
the internationally established times38. Its capacity for
dissemination of the benefits of intellectual property
is limited, which is reflected in the lack of use made
of the various forms of protection and limited use of
them as sources of technological information.


Quality system
The body responsible for this function until recently was
CONACyT. however, as seen in section B, this func-
tion will be transferred to a new body in the ministry of
Economy, the National Quality Council, which will co-
ordinate the functions of four agencies responsible for
metrology, accreditation, standardization and techni-
cal regulation. For example, in interviews, weaknesses
were detected concerning capacity for international
accreditation in the pharmaceutical sector.


3. Other direct measures
Scientific and technological information services
This area has essentially been covered by CONACyT,
either through the Technological Information Centre,
and the compiling of STI statistics and generation of
indicators, as well as other dissemination services.
Similarly, the directorate of Innovation and Technolog-
ical development (dIdT) in the vice ministry of Trade
is working in this area (sectoral units, for example).


Promotion of networks and systems for the dissemi-
nation of an entrepreneurial and innovation culture
The main instruments found under this heading are
the responsibility of SINAlIT, operated by the ministry
of Agriculture and livestock, the programmes of the
directorate of Innovation and Technological develop-


ment and, to some extent, some of the actions co-
ordinated by INSAFOrp. however, as a whole, these
efforts are still modest and, as mentioned above, do
not take advantage of the synergies what could be
generated by coordinated action.


4. Catalytic financial measures
Loans and guarantee funds
These are operated through the organization in the
financial system described in section d.4. There is
still no experience of instruments which would have
the greatest impact, such as venture capital or seed
capital.


5. Combined or mixed measures
Creation of industrial conglomerates or clusters
The actions of FOmIlENIO include targets which to
some extent serve this objective, as does SINAlIT in
the ministry of Agriculture and livestock.


Foresight
The development of the Five-year plan implies a long-
term forward-looking exercise for the country, but there
has so far not been any integrated attempt, at national
level, to conduct an STI foresight exercise that would
allow the identification of some priority areas.


6. Other
International cooperation
International cooperation is one of the mechanisms
most used to implement actions in support of STI ac-
tivities. Some of the chief actors in El Salvador are
UNdp, German cooperation through GIZ, Japanese
cooperation through the JICA and United States co-
operation through FOmIlENIO. International banks,
such as the IAdB and World Bank have also been im-
portant actors.


This chapter has listed and described the components
of the national system of innovation of El Salvador, its
linkages and the STI policy instruments deployed by the
Government of El Salvador. This description, together
with the evaluation of Salvadorian performance in sci-
ence, technology and innovation, described in Chapter
I, will provide the basis for a diagnostic of the national
system of innovation and the formulation of a series of
recommendations to strengthen it in Chapter III.


NoTES See page 59.




El Salvador: a National System
of Innovation – work in progress.


diagnostic of the system and
proposals for its development




48 Science, Technology and Innovation Policy Review - El Salvador


The description in Chapter II of the components
of the El Salvador’s national system of innovation
(NSI) allows us now to undertake a diagnostic of that
system (section A). Based on this diagnostic, section
B discusses a set of proposals for strengthening the
components and links of the NSI, illustrated by the
experience of other countries and best practice in the
design of STI policies, programmes and instruments.


A. GENERAl dIAGNoSTIc


In El Salvador, the two systemic conditions which would
constitute a solid and sustainable national system of
innovation do not exist. On the one hand, there is no
joined-up system of STI policies, but rather isolated
policies targeting either science and technology or
else innovation, industrial development or exports.
Furthermore, resources allocated to them are very
limited, even in comparison with the Central American
and latin American environment. On the other hand,
there are incipient subsystems for generation of
knowledge and production with very limited capacity
for collaboration. These factors and processes are
described in detail below.


1. Functions of cohesion and foresight
As evidenced by the information provided in chapter
II, there is no government body which specifically
provides cohesion and direction to policies concerning
STI activities. In theory, this work should have been the
responsibility of CONACyT, but this was a body with
a very weak position in the government hierarchy and
lacked the necessary resources to carry out the tasks
originally assigned to it. It could even be said that
the work done by CONACyT was laudable, given the
precarious situation in which it found itself. moreover,
the Innovation promotion Group, established to
promote a single, integrated and multisectoral effort
to formulate guidelines for innovation has practically
ceased to function.


STI occupies a lowly position in the Government’s
hierarchy of priorities and decision-making and has a
small budget. Currently, in reality and in accordance
with the Scientific and Technological development
Bill (presented by the ministry of Education) and a
future Innovation Act (responsibility of the ministry
of Economy), this responsibility will fall to the vice
ministries of Science and Technology and Trade and


Industry. This shows the lack of a more integrated
approach to innovation, which would encourage
the participation of other government agencies and
coordination between science and technology policies
and innovation policies.


As a consequence, the various ministries and even the
Technical Secretariat of the presidency have proposed
policies along one line or another, which, despite being
well-intentioned, do not provide complementarity or
synergies which could multiply their effectiveness. A
clear example of this situation is the fact that both the
ministry of Education and the ministry of the Economy
have programmes to strengthen the national system
of innovation which, without containing fundamental
contradictions, do not contemplate the common
strategic lines which, aligned with State policies at
the highest level, would generate synergies. however,
shortly after the completion of the review, mINEd
and mINEC worked on a joint proposal for a policy in
Innovation, Science and Technology which could help
to remedy this situation.


In addition, the industrial policy, the innovation policy,
the science and technology policy as well as the
public-private partnership policy are being developed
in an isolated manner, without taking into account
what, among others, the ministry of Agriculture and
livestock or the ministry of health, are doing in the
area of STI.


With respect to foresight, the Five-year plan has been
produced, representing the country’s development
vision and plan. however, this excellent work lacks
specific detailed programmes, at least as regards STI.
What does exists, the National Science, Technology and
Innovation policy 2006-2030 and the recent National
plan for Scientific and Technological development
are very broad and ambitious. The National STI policy
includes 13 areas of knowledge for scientific and
technological development, while the National plan for
Scientific and Technological development proposes
29 areas and 156 strategic lines. With investment in
r&d of some 16 million dollars39 and 500 researchers,
it seems unlikely that such ambitious plans will come
to fruition.


Under the same heading, the Integral Export promotion
Strategy (2010-2024) is a much more realistic proposal,
with goals that are seen to be achievable and specific
programmes and instruments. however, it is not clear,
for example, how the five strategic sectors that it sought
to stimulate were defined, especially ICT where it was




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dIAGNOSTIC OF ThE SySTEm ANd prOpOSAlS FOr ITS dEvElOpmENT


found that there was insufficient capacity. moreover,
the document contains certain inconsistencies in
that the lines of action do not fully correspond to
the programmes and instruments. Neither does it
contain elements that link the strategic goals with
the programmes, nor indicators for monitoring and
making the necessary adjustments.


In short, no national foresight exercise on STI has been
carried out from which would emerge a reasonable
and limited number of priority areas in which, as
well as research strengths and production capacity,
potential applications in areas of economic and social
relevance would be envisaged. This first step should
lead on to development programmes and policy
instruments to direct the scarce resources to activities
with the greatest potential and impact.


2. Management, control and regulatory
functions


When it comes to management, the basic problem
is the lack of policy coordination among the principal
government bodies. Given the limited amount of
policy instruments and resources, managing them
does not present a problem and there are adequate
organizations to satisfactorily fulfil the necessary
functions. The same can be said of the legal and
regulatory aspects in general.


With regard to the Scientific and Technological
development Bill, although it contains various very
positive actions, it also includes aspects or actions
which may cause problems and/or are formulated
ambiguously, notably:


• The hierarchical position of the management of STI
at vice-ministry level and in the education sector. This
orientation presents difficulties primarily because it
does not reflect the multi-sectoral character of the
activities in question and the fact that, to some extent,
it replicates the model already tried with CONACyT
of managing STI policy at a level subordinated to a
ministry.


• The constitution of the National System of Innovation,
Science and Technology, a fairly common practice in
latin America, reflects a narrow interpretation of the
systemic visions applied to STI which can generate
misleading expectations concerning the nature of a
national system of innovation.


• Added to the foregoing is the problem of the future
Innovation Act, which the ministry of Economy will be


responsible for presenting. Although the Scientific
and Technological development Bill provides that
the two laws will complement each other, it may be
difficult to reach agreement on the limits of action
of the two ministries involved in the sphere of
innovation.


Another aspect about which no information was found
concerns monitoring, evaluation and adjustments
(control) carried out in conjunction with the STI
policies measures that are applied. In fact, during the
workshop held to analyse the first draft of the review,
the lack of an evaluation culture was confirmed. This
lack of monitoring and evaluation can be found at the
level of policy design as well as at the programme and
project implementation level, and there is even a lack
or insufficiency of preliminary diagnostics as well as
formal methods of monitoring progress and evaluating
impacts. Examples of these shortcomings are:
• The creation of new research centres, although their


constitutions and structure is still not clear.40 In this
regard, no diagnostic is known which would justify
its creation, especially when, given the scarcity of
resources, it might be preferable to strengthen the
infrastructure and staff of existing public research
organizations.


• The project to create a “technology park”, without
any evidence of a preliminary analysis being carried
out, including a comparison of the successes and
failures of this type of initiative in latin America41 and
the viability of implementing one in El Salvador.


• The proposed industrial policy42 which is being
drawn up by the vice-ministry of Trade and
Industry which, although it does have a preliminary
diagnostic includes innovation as one of its lines, its
specific instruments do not include evaluation and
monitoring from the design stage.


3. Production and execution function
The key component of what could form El Salvador’s
system of innovation, the productive sector, is still
embryonic and is too heavily concentrated in micro-
enterprises. Although some industries do exist with
certain strengths in the local environment, few of
them are competitive in the latin American region and
neither do they show any inclination to innovation.


Furthermore, the research sector is weak in terms of
both human and financial resources, being almost
totally dependent on the higher education sector, and
lacks competitiveness in latin America. Education in




50 Science, Technology and Innovation Policy Review - El Salvador


general and higher education in particular also have
considerable room for improvement if they are to
catch up with the most developed Central American
countries.


Consequently, the contacts between knowledge
generating bodies and their users for productive
purposes is very limited. This is due to a variety of
factors apart from the structural weaknesses of those
involved mentioned earlier. Among these the following
should be highlighted: low demand for knowledge and
technology in the productive sector, which also means
lack of awareness of the usefulness of knowledge
to generate value, the scarce and limited financing
options, and the small range of innovation policy
instruments and the related budgetary constraints.


With respect to the functioning of industrial chambers
and associations as well as support bodies, while
there are no quantifiable data to evaluate their work,
the actions they take are positive. however, in the
case of the former, their involvement in promoting
innovation and fostering an innovative culture has
been limited and some are not powerful enough to
influence the State in taking decisions in favour of
their members. As regards the latter, their scope of
action depends very much on their budgets and size,
but they generally perform well. In addition, the work
of FUSAdES deserves special mention, as one of
the organizations whose work has had an important
impact on the promotion of enterprise activity in
general as well as of innovation.


Finally, the institutions of the financial system have
only been marginally involved in the promotion of
innovation, with the exception of the BmI, which has
worked in partnership with other bodies and has
supported large-scale programmes and projects.
however, a problematic aspect concerns the lack of
staff in the financial system trained in the evaluation of
business plans or innovative projects.


B. STRENGThENING
ThE comPoNENTS ANd
RElATIoNShIPS of ThE
SAlvAdoRIAN SySTEm
of INNovATIoN


Based on the above analysis of the Salvadorian
system of innovation, the following section suggests a


series of actions necessary to strengthen the system’s
components and relationships.


1. Political and social conviction and
commitment


The first step that should be taken to bring about the
emergence of the system of innovation in El Salvador,
which will allow it to convert itself from an efficiency-
based economy to a knowledge-based economy,
consists of changing the perception that the State and
society have of innovation. This involves:


1. The conviction, from the highest level of government
and society in general, that the generation of
knowledge and technological innovation have
become the driving forces of growth and social
and economic development. The governance
of STI should be headed in the last resort by the
presidency of the republic. however, up to now,
political debate in El Salvador does not show any
sign of sufficient attention to STI topics which
justifies political involvement at the highest level,
even though an intention to work in this direction
can be observed. In reality, this responsibility
currently falls on the vice-ministries of Science and
Technology and Trade and Industry.


2. Under this heading, the agreement, adoption and
dissemination of an up-to-date definition of innova-
tion is essential to explode the myth of this concept
and include at least four types of innovation that
are recognized today: product, process, organiza-
tion and market innovation, as well as the various
degrees of originality that innovation may present
– new to the company, new to the local market and
new to the global market. This new, unified vision
of the concept of innovation has implications which
will be discussed in sections 2 and 5.


In addition, it would be helpful with respect to dis-
semination to use the concept of open innovation,
which is an approach based on the idea that com-
panies cannot confine themselves to their own re-
search activities in order to be innovative and that
they can and must use external as well as internal
knowledge (Chesbrough, 2003). This concept, while
it may be a new form of management discipline that
refers to old ideas, could be useful in inducing in
the business world a systemic vision of innovation.


3. Forming an integrated vision of productive develop-
ment centred in innovation (including higher edu-




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dIAGNOSTIC OF ThE SySTEm ANd prOpOSAlS FOr ITS dEvElOpmENT


cation, scientific and technological development,
productive articulation) and supported by environ-
mental conditions which include education (basic
to higher secondary), foreign direct investment and
export promotion.


4. The will to overcome differences between state enti-
ties and economic agents to allow the implementa-
tion of the changes necessary in all areas, so that STI
becomes effectively the driving force of the economy
and, ultimately, society as a whole. Specifically, differ-
ences of approach were observed, on the one hand,
between the ministries of Education and Economy
with respect to STI policies and policy instruments.
Secondly, in the field work and the review of the STI
development plan, a preference was observed in the
approach of the vice-ministry of Science and Tech-
nology for the promotion of science at the expense
of the development of policies aimed at the develop-
ment of entrepreneurial innovation. This resulted in
insufficient attention to the needs of enterprises for
technology and innovation.


It should be emphasized that coordinating the
work of the ministries is more than just holding joint
working meetings and agreeing on certain matters.
It involves the alignment and convergence of the
agendas of the ministries concerned and elimination
of duplication of efforts by some bodies.


5. The establishment of realistic plans, programmes
and policies, with clearly defined goals and objec-
tives, as well as appropriate performance indicators
to measure achievement of goals in the allotted
time.


6. The allocation of the necessary human and financial
resources necessary to achieve the goals set out in
the plans, programmes and policies.


The following sections put forward some recommen-
dations on areas which require particular attention.
however, it is necessary to point out that: (i) this pro-
cess must rely on four fundamental pillars: investment,
education, research and entrepreneurial develop-
ment; and (ii) it is a long-term process which, although
it may bear fruit in the short term, must be sustained
through several government administrations if it is to
achieve a significant impact on the country’s social
and economic development.


2. Direction and cohesion
In addition, the responsibility for the development and


sustained improvement of these four pillars belongs
to both the public and private sector, although the
composition of their contributions can vary according
to the different specific circumstances in which
they are involved. In other words, the launch of this
process means that the highest authorities of the
State must take charge of the direction and cohesion
of the Salvadorian system of innovation but there
are important aspects relating to research, training
and investment which must also be assumed by the
private sector.


The natural division of functions of the Executive
into ministries can be an obstacle to the operation
of systemic policies, since the different entities
could assume that promoting STI is their exclusive
responsibility, when what is required are cross-cutting
policies which allow each ministry, in coordination with
the rest, to adopt policies aimed at national innovation.
Thus, it would be desirable for El Salvador to have a
supra-ministerial body (whose head would naturally
be the president of the republic) which would take
charge of the functions of direction, coordination,
foresight and establishment of general policy lines
which, with regard to the objectives of innovative
development, would allow the various ministries to
operate as a system.


With respect to the systemic operation of both the
government structure and the various executing
agents, it is crucial to stress that the concept of
national system of innovation (like any system of
human activity which has a purpose) is not a physical
entity or institution. It cannot be created by a law or
decree. It is simply a methodological framework which
allows us to comprehend a complex reality in order to
manage it in a coherent manner so as to orientate it
towards a given goal.


3. Foresight and setting of priorities for
research and development


The launch of the process of transformation and
the development of its pillars must be defined and
orientated by means of an in-depth national foresight
exercise which, up to now, has only been undertaken
in terms of the country’s general foresight. however,
the specific part relating to the development of STI
has not been developed in an integrated way. Neither
is there any sign of the pursuit of an appropriate
foresight methodology through a review of international
experience on this subject.




52 Science, Technology and Innovation Policy Review - El Salvador


It needs to be considered that this type of study or
exercise can only be carried out when there is the
will and capacity to take the necessary decisions to
implement the recommendations which result from
them. This means that the participation of decision-
makers in these exercises is crucial, as is the
involvement of the executing agents involved in the
areas covered by the four pillars mentioned above.


The outcome of this foresight work would be possible
scenarios of development in science, technology and
innovation, from which the most desirable and prob-
able would be selected. It would also include the
specific actions necessary to achieve it (or to avoid
evolving towards an undesirable scenario). due to re-
sources constraints, these actions must include priori-
ties for scientific and technological development in a
few areas which combine at least: (i) current existence
of research and production capacities or the potential
to develop them in the short term; and (ii) the pros-
pect of opportunities for exploiting these capacities
through innovations with a high economic and social
impact in the medium and long term. Analyses of the
bibliometric and patent studies type, such as those
presented in the annexes, are tools which can be very
useful in justifying the choice of priority areas.


It is necessary, therefore, to carry out a comprehensive
analysis of those industrial and research areas which
are really strong and which employ local capacities.
That would be followed by a review of whether the
strengths have a consistency and what are the areas
and sectors in which it is possible to obtain immediate
results, those which need to be strengthened and
developed in the medium term, and even deciding
whether some of them will have to be abandoned
or developed in the distant future. It should be clear
that the setting of priorities means making strategic
sacrifices, i.e., ceasing to finance areas which are
not among those identified as key to El Salvador’s
development.


The foregoing represents the starting point for setting
priorities, defining concrete goals to be achieved
in specific timeframes, appropriate indicators to
measure performance, and the budgetary and
investment amounts to be allocated to each. The
results of the foresight exercise should thus be
translated into specific programmes which are clear
as to the contribution each makes to achieving the
general goals, designating the entities responsible
for their execution, with well-defined timeframes and
criteria for evaluation of their achievement.


4. Organizational structure and
management


The analysis has highlighted the fragmented vision
of the innovation process, how a phenomenon which
is part science, part technology, part management,
part industrial capacities, etc. has generated a
lack of alignment between the policies set by the
different ministries whose responsibilities converge
in innovative activities. It has given rise to a degree
of privilege to policies on the primary generation or
supply of science and technology, i.e. those which
assume that it is enough to promote research to
generate interactions which lead to innovation.
The systems approach and network features of the
innovative process, however, show that this type of
policy is insufficient. It is necessary to involve different
agents and both supply and demand aspects.


a) Statistics, information and indicators


The proper functioning of the supra-ministerial body
mentioned in section 2, and of the ministries involved
in innovation actions, requires modernization in
terms of the gathering of information and generation
of STI indicators. As has been seen, CONACyT has
done good work in this sense, but it has not been
very systematic and there is still plenty of room for
improvement in this field, especially with regard
to carrying out regular surveys of innovation and
adoption and use of information and communication
technologies in the productive sector.


This means, firstly, modernizing the digital and
telecommunications infrastructure, which would
interlink the various national bodies which provide
services and carry out actions related to STI. It also
means modernizing the models on which the gathering
of information is based and translating data into
indicators that provide useful information for decision
making. These information gaps must be corrected,
and, as far as possible, aligned with international
standards43 to allow international comparison of r&d
and innovation activities in El Salvador.


b) Evaluation


An aspect which, nowadays, is fundamental to the
design and implementation of public policies and
which in the case of STI policies is highly important
(due to the multi-factorial character of innovation) is the
integration of evaluation and monitoring mechanisms
in the work of designing policies, instruments and




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dIAGNOSTIC OF ThE SySTEm ANd prOpOSAlS FOr ITS dEvElOpmENT


programmes. In the case of El Salvador, the perception
is of a deficient, indeed almost non-existent, culture of
evaluation with regard to bodies involved with science,
technology and innovation activities, including the
country’s public university itself.


Only by systematic monitoring and evaluation of the
results of policies, instruments and programmes is it
possible to know with certainty the effectiveness and
efficiency in the use of resources, or to obtain feedback
on the utility of programmes and instruments, so
as to allow their informed adjustment or even their
cancellation.


That is why both the Technical Secretariat of the
presidency and the ministries involved in creating the
vision of productive development based on innovation
need to contemplate the training of their staff on the
design and evaluation of public policies. They, in turn,
would be responsible for sharing their knowledge so
as to generate a multiplier effect and disseminate the
culture and skills required for evaluation.


5. STI policy instruments
The types of STI policy instruments are very varied
and have generally been the subject of two main ap-
proaches: the nature, characteristics or mechanisms
for deployment and their objectives or goals. The first
approach distinguishes, for example, whether the
measures involve financing or not, are direct or indi-
rect, or whether they are cross-cutting (of general ap-
plication) or target certain sectors or specific groups.


On the other hand, the second approach tries to identify
the deficiencies or weaknesses which the instruments
are seeking to correct. In general terms, identifying
these deficiencies uses the concept of innovation
possibility frontiers,44 distinguishing between policies
which modify the innovation possibility frontiers of all
the enterprises and policies which induce enterprises
to position themselves at a different point within their
current possibility frontier. The former are policies
which could be called facilitating (or systemic), while
the latter consist of corrective policies, i.e. of a more
orthodox kind (from an economic perspective).


The most common practice consists of adopting a
mixed approach, constructing matrices which combine
the range of types and objectives to characterize
what some authors call the policy mix of a country in
particular.45 From now on, we will use this approach
to identify the principal STI policy instruments in El
Salvador. Table 1 shows a possible policy mix, and an


approximation of its current use in El Salvador. Table
1 also serves to exemplify instruments which can be
explored in the future.


Based on Table 1, some of the instruments which
are still not used in El Salvador and which could be
considered include: increasing the funds allocated to
training at postgraduate level in the identified prior-
ity areas; an increase in funds allocated to r&d and
innovation with collaboration between various entities
which generate and use research, including higher
education institutions, research centres, enterprises
and hospitals which carry out research; an increase in
funds allocated to r&d and innovation in enterprises;
the design of tax incentives or exemptions for r&d
in enterprises; the development of a culture which
promotes technological foresight and intelligence in
enterprises; the development of technological intel-
ligence services; promoting the creation of mecha-
nisms for the transfer of knowledge in universities,
from technology transfer offices to incubators for sci-
ence and technology-based enterprises; the creation
of a mechanism for accreditation of the country’s re-
searchers (although it could be solely honorary and
need not necessarily involve economic incentives,
along the lines of some models used in latin America)
which recognizes the work of those who distinguish
themselves in pure and applied research and devel-
opment and transfer of technology.


One aspect which it is important to take into account
when defining the policy mix, and which is connected
with the definition of innovation discussed in section
1, is the need to have differentiated policy instruments
for medium-sized and large enterprises and for
mSmEs. Based on the identified priority areas, these
instruments contemplate distinct objectives (targets
to be achieved by the instrument), requirements,
funds and credits. What is vital is not to forget that
both types of enterprise need to be supported and
that they have different needs for innovation.


related to the above and the aspects mentioned
earlier concerning the setting of priorities, it is also
important to mention that STI policies should not be
confused with social policies. Given the number and
needs of mSmEs in El Salvador, it is easy to fall into
the trap of trying to support the maximum possible
number of enterprises. however, this only leads to
a dispersion of resources. It is not an STI policy but
rather a response to other social objectives which,
while legitimate, are not STI objectives.




54 Science, Technology and Innovation Policy Review - El Salvador


It is important to emphasize that the successful
application of a policy instrument in a country depends
on its coherence with the established objectives and its
management. Box 1 provides a set of good practices
in the use of STI policy instruments which may be
useful as a guide to their design and management.


Sectoral and regional systems of innovation


The construction of a national system of innovation
must be based, firstly, on building the capacities of


the smallest components of the system, the small
producers, while at the same time, strengthening the
components which have already reached a certain
level of development. There is no doubt that, in this
respect, various policies in El Salvador have been more
oriented to the traditional productive sectors such as
agriculture, livestock and agro-industry. however,
from a sectoral perspective, these efforts need to
be expanded to generate productive chains in other
industries with potential, such as pharmaceuticals and


Table 1. STI policy mix matrix and approximation of its current use in El Salvador


Deficiencies targeted (a)


Corrective
or orthodox


policies


Facilitating
or systemic


policies


Deployment
mechanisms Policy instruments


Direct financing
measures


Research in public bodies


Funds for university research


Training of human resources (scholarships and mobility)


Support for STI infrastructure


Funds for entrepreneurial R&D


Support for R&D in collaboration


Public sector procurement


Indirect financing
measures


Tax incentives for R&D by volume


Progressive tax incentives for R&D


Catalytic financial
measures


Seed and venture capital


Networks of investment “angels”


Guarantee funds for credit to MSMEs


Guarantee funds on net capital of MSMEs


Other direct
measures


Competitive-technological intelligence services


Technology brokerage services (transfer)


Dissemination of an entrepreneurial and innovation culture


Promotion of networks


Indirect regulatory
measures


Intellectual property rights


Competition policies


Metrology and standardization


Mixed measures Technological Development Centres


Incubation of enterprises


Creation of clusters


National STI foresight exercises
a It should be noted that the orientation range of some instruments may vary in many of the cases. For example, tax incentives for


R&D can be of general application (the same rules for all enterprises) or may target certain groups (reduced requirements or greater
benefits for MSMEs).
Intensive use of the instrument
Little use of the instrument
Not used


Source: UNCTAD.




55
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dIAGNOSTIC OF ThE SySTEm ANd prOpOSAlS FOr ITS dEvElOpmENT


Box 1. Good practices in the use of STI policy instruments


The successful application of a policy instrument in a country depends on the characteristics, objectives and form of
management of that instrument. It cannot be assumed that the transplantation of a successful policy instrument will be
likely to work well in another country, since its success depends on its perceived objectives, design and management.
The following is a set of good practices in the use of STI policy instruments which may be useful as a guide to their
design and management. These good practices stem from the experience of other countries, chiefly in latin America.
Some examples from countries which have used these instruments are included as a guide – the lists of examples are
not exhaustive.


Postgraduate scholarships
General description: programmes or funds for internal or external training/strengthening mechanisms


Potential beneficiaries
direct: Individual persons: students or researchers
Indirect: research centres, enterprises and society in general


Scope: mainly aimed at priority areas


Type: Intermediate, between corrective and facilitator (see Table 1)


Orientation: Generation of knowledge


Origin of resources: public, international cooperation and, exceptionally, enterprises


Examples: Argentina, Brazil, Chile, mexico


Good practices
- Attention to strategic sectors or those with potential impact
- Alignment with STI development priorities
- Complemented by programmes to strengthen quality national postgraduates
- Complemented by repatriation programmes and other mechanisms to encourage return
- Transparent evaluation mechanisms and accredited evaluators
- promotion of enterprise participation in specific financing programmes
- Systematic evaluation mechanisms


Financing of R&D and innovation projects
General Description programmes or funds for financing research, development or innovation projects/collaboration


Potential beneficiaries
direct: public research centres, enterprises or both
Indirect: Society in general


Scope: General and targeted according to national policies


Type: Generally corrective/may be converted to facilitator (see Table 1)


Orientation: From generation of knowledge to innovation


Origin of resources: public, international cooperation loans and enterprises


Examples: FONdECIT and FONdEF-Chile; mixed Funds-mexico; FINCyT-peru


Good practices
- Attention to strategic sectors or those with potential impact, regional needs and micro enterprises and SmEs
- Alignment with industrial development policies and other spheres of public policy
- promotion of research-industry collaboration
- Competitive funds
- Collaboration in advanced training
- Transparent evaluation mechanisms and accredited evaluators
- Systematic evaluation mechanisms


Tax incentives for R&D and innovation
General description: Tax reductions to stimulate technological development and innovation


Potential beneficiaries
direct: Enterprises
Indirect: public research centres and higher education institutions (collaboration) and society (cont.)




56 Science, Technology and Innovation Policy Review - El Salvador


Box 1. Good practices in the use of STI policy instruments (cont.)


Scope: ranging from general to aligned with national policies


Type: Basically corrective (see Table 1)


Orientation: Innovation


Origin of resources: public


Examples: Chile, mexico


Good practices
- Appropriate design, balancing support for large enterprises and mSmEs
- legal and regulatory framework
- Simplicity of mechanism (transparency and accessibility)
- low administrative costs for the public sector and enterprises
- long-term reliability and stability of the mechanism to allow planning by enterprises
- Clear criteria and definitions relating to STI activities
- Systematic evaluation mechanisms


Enterprise incubators-accelerators
General description: Organizations which provide a wide range of services to support primarily new enterprises


Potential beneficiaries
direct: Individual entrepreneurs, enterprises
Indirect: public research centres and society in general


Scope: Generally targeted (specific sectors and mSmEs)


Type: Corrective (See Table 1)


Orientation: Innovation


Origin of resources: public, private or mixed


Examples: Brazil, Chile, mexico


Good practices
- Attention to strategic sectors or those with potential impact, regional needs and micro enterprises and SmEs
- Alignment with industrial development policies and other spheres of public policy
- Alignment with STI development policies
- Concentration of resources and convergence of instruments
- Gradual progress, contemplating the available critical mass and market opportunities
- Covering the pre-incubation-acceleration spectrum
- participation in networks
- Systematic evaluation mechanisms


Source: UNCTAD.


metal engineering, for example. It is even possible to
envisage the convergence of sectors which have
strengths with others where it is worthwhile generating
capacities, such as health or metal engineering,
and information and communication technologies,
in order to generate policy instruments aimed at
the development of new products and services with
export potential.


As a complement to sectoral policies, it would also be
desirable to explore the development of regional
systems of innovation (see Annex C). Although El
Salvador is a small country, its diversity means that
zones can be identified which require special attention
in aspects of development, or can be characterized by


a certain specialized production (an example of this is
the FOmIlENIO’s work in the country’s northern zone).
The complementarity between policy instruments
to generate value chains and the promotion and
stimulation of production in the regions, generating
productive zones or corridors, can be a more effective
mechanism for strengthening the national system of
innovation, by substituting policies which require major
investment and for which the necessary conditions to
implement them are not sufficient in El Salvador (like
the as yet ill-defined proposal for technology parks).


Investment and financing


There is an urgent need to increase national spending




57
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dIAGNOSTIC OF ThE SySTEm ANd prOpOSAlS FOr ITS dEvElOpmENT


or investment in r&d, since, compared with latin
America, El Salvador’s spending is among the
lowest. precisely due to the scarcity of resources, the
orientation of resources to priority sectors and areas
of research with high future potential is vital, by means
of policy instruments which can take advantage of
existing strengths both in research and productive
development.


however, this increase in national investment is not just
the responsibility of the State. It is essential to increase
the participation of private capital in the financing of
STI activities through a mix of policies. These policies
must contribute through training and cultural change,
as well as through well designed incentives (such as
indirect and tax incentives, or competitive funds for
research projects), so that private investors involve
themselves in the national commitment to innovation
and assume undertakings with higher levels of risk.


The proposal included in the Five-year plan to create
a development bank through the combined work of
the existing entities (BmI, Bh and BFA) is appropriate.
however, it would be important to ensure that resources
actually exist and the access to them is rapid and
efficient. likewise, the broad and correct effort to
obtain funds from international cooperation should
not be overlooked but should even be intensified, also
as a function of the priority development areas.


Promotion of a systemic vision and innovative cul-
ture


The systemic approach to innovation can be applied
and operates at different hierarchical levels. part of the
STI policy mix must be focused on disseminating the
benefits of this approach to training entrepreneurs and
researchers and training them in it. The application of
these concepts to the organization and operation of
productive firms and knowledge generating entities is
one of the foundations or the glue needed to construct,
from the bottom up, regional and sectoral systems of
innovation, which in turn become facilitators of the
coordination of a national and even supra-national
system of innovation.


This dissemination and training must culminate in a
cultural change, which we have discussed, which is
also necessary to achieve the commitment of all the
actors to the transition from an efficient economy
to one based on knowledge and innovation. The
responsibility for this transition is a shared one, and
there must be an awareness that although it can


be directed and coordinated by the State, it is the
economic and productive actors who will make this
possible through investment and work.


6. Education
A reform and modernization of the educational system
at all levels, as well as an increase in public spending
in this area, is essential to support the change in the
medium and long term. Education policies have an
impact on all areas of national development and have
been fundamental companions of those relating to
STI in many countries, irrespective of their stage of
development. Fundamental changes are necessary,
from the training of the teachers themselves and their
access to continuing education, to the reformulation
of study plans and programmes to strengthen the
teaching of mathematics and the natural sciences. An
interest for science and technology, curiosity and the
capacity to solve problems need to be promoted from
the early childhood age.


In the case of tertiary education, it is further necessary
to increase significantly the financing allocated to
postgraduate studies. models can be exploited
which represent targeted support, both to academic
institutions which offer quality programmes (which are
subject to strict evaluation criteria) in areas defined as
priorities, and students taking master’s degrees and
doctorates in those programmes. Similarly, models can
be exploited which involve enterprises in the financing
of scholarships for students working on subjects
of value to those enterprises. It is also important
to increase bilateral and multilateral international
cooperation agreements to allow a substantial
increase in the number of Salvadorian postgraduate
students in quality programmes in various countries.


Finally, it is also vital to generate programmes of
incentives for repatriation or eventual benefiting from
Salvadorian talent which has stayed in other countries
after the end of their postgraduate studies, or which
has emigrated in search of better opportunities to
use their abilities. In this regard, there are various
experiments in latin American countries (sometimes
designed to attract human capital in general) which
could be examined with a view to trying to adapt
them to conditions in El Salvador. These include the
establishment of centres of excellence (FONdAp
in Chile), the UNESCO fellowships (operating in
several countries), repatriation grants accompanied
by research posts in universities (in mexico), or the




58 Science, Technology and Innovation Policy Review - El Salvador


programme to attract top r&d talent in panama.
Some of these programmes involve the creation of
an environment conducive to distance collaboration
by local research groups or hosting foreign-based
researchers for a given period of time. Other are
aimed at generating the conditions to attract national
or foreign researchers based abroad to settle
permanently in El Salvador.


With regard to the training offered to enterprises, it is
also recommended that the activities of INSAFOrp
should be reviewed and modernized, to make it more
proactive and a true driver of an innovative culture.
According to information obtained in various interviews


and other studies (Arritt, 2006), it is also necessary
to reinforce the accreditation of the consultants
contracted to carry out the training.


Following on from this analysis of the national system of
innovation, Chapters Iv and v provide a more detailed
analysis of the system of innovation in the agro-
industry and the information and communications
technology sectors. Although the innovation activities,
the configuration of the actors and their relationships
are different in each sector, the analysis of those
sectors corroborates the general diagnostic of the
national system of innovation.




59
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dIAGNOSTIC OF ThE SySTEm ANd prOpOSAlS FOr ITS dEvElOpmENT


NoTES
1 See for example, the definition suggested in the introduction (metcalfe 1995).


2 By innovation, we mean: “…the implementation of a new or significantly improved product (good or service), or process, a
new marketing method or a new organizational method in business practices” (OECd 2005). In this generally accepted
definition, the currently accepted dimension of newness is measured in terms of whether the implementation is new for
the firm or for the market, which gives it a broader meaning than the previous distinction between radical and gradual
innovations – for example, the acquisition of technology is a form of innovation (OECd and Eurostat 2005).


3 See Annex B for a theoretical discussion of NSI.


4 In the strict sense of industrialization, not the broad sense of productive development.


5 This view of innovation policies, traditionally limited to the attention paid to the vectors of industrialization, even predates
the concept of NSI (rothwell and Zegveld 1981); on their inclusion in this approach, see dalum et al. 1992 and lundvall
and Borrás 2005.


6 Capacity to maintain an identity independent of other systems within a shared environment, i.e. the system’s ability to
maintain an independent existence.


7 model based on Beer 1972, 1984, 1985.


8 With respect to science, technology and innovation, the structure of the Salvadorian Government has been in a state of
change since the Government of president Funes took office, thus at the time of writing this review, there may be certain
bodies whose tasks and functions are in a state of transition.


9 Given the country’s natural resources, orientation and productive goals.


10 This list of ministries is not exhaustive, since, for example, the ministries of health and Tourism, as well as others, may
be involved in STI activities. here we are simply considering those with the most intensive activities in this area.


11 Act on the National Council for Science and Technology, legislative decree Nº 287, Official Journal, 10 August 1992.
however, the new Scientific and Technological development Bill assigns this responsibility to the vice minister of
Science and Technology (see Section C.4).


12 Ibid.


13 Bill on the Salvadorian Quality System, ministry of Economy, version received in may 2011, but still under consideration
by the legislative Assembly.


14 CONACyT, 2006, p. 5.


15 Not necessarily STI policy instruments.


16 And a more realistic time horizon, up to 2010, involving two future reviews.


17 prepared with the support of the scientific community of El Salvador.


18 The priorities in research, development and innovation are identified by a survey of activities carried out by research
centres and universities in El Salvador and their potential.


19 http://www.minec.gob.sv/index.php?option=com_content&view=article&id=663:eife&catid=1:noticias-
ciudadano&Itemid=77.


20 By 2024, it is proposed approximately to triple the number of exporting companies, increase by 25 per cent the number of
destinations, triple export revenues and increase by 25 per cent the number of products exported.


21 Source: http://www.mined.gob.sv/index.php/noticias/1-institucional/4263-seminario-sobre-investigacion-y-presentacion-
de-proyectos-fies-.html, information dated december 2009, collected in September 2010.


22 defined as enterprises with four employees or less.


23 Which may perhaps not be the best indicator but provides a reasonable approximation in the absence of more precise
information.


24 This does not mean that they have Salvadorian nationality.


25 defined as the ratio of royalties received and paid for licensing of technology.


26 Taken in part from Argumedo (draft) and various press information.


27 mINEd (2011) mINEd Information Bulletin available at www.mined.gov.sv


28 voluntary certification of academic quality for higher education institutions.


29 however, this registry (available at www.redisal.org.sv) includes organizations for which there is no evidence that they
carry out research, while it does not include universities which do, in fact, carry out research, such as the Alberto
masferrer Salvadorian University or the Benjamín Bloom hospital.


30 register of National Scientific researchers of the Salvadorian research Network (rEdISAl), www.redisal.org.sv,
information collected in February 2011.




60 Science, Technology and Innovation Policy Review - El Salvador


31 The research period runs from 1941, although there are only three publications before 1972, the year when they began
to be more frequent and regular.


32 http://www.ricyt.org/index.php?option=com_content&view=article&id=149&Itemid, data obtained in may 2011.


33 In addition, in the interviews conducted, both positive and negative comments were made on some universities,
technological institutes and educational bodies.


34 This indicator reflects the percentage of teachers contracted only to teach classes (hora clase) in relation to the total
teaching staff of the institution. “Class time only” teachers have no responsibilities other than to teach the class for which
they are contracted. Thus, this is not conducive to helping students outside the classroom and they do not participate in
research projects and the social project of the institution (mINEd 2010c).


35 Schwab (2010).


36 however, in interviews with autonomous bodies, it was stated that CENTA’s transfer activities could still be significantly
improved.


37 These instruments may also be seen as forming part of the environmental conditions.


38 It should not be forgotten that demand for intellectual property services in El Salvador is low.


39 Investment in r&d by the higher education and government sectors in 2009.


40 The report of Activities (mINEd 2010a) reports the creation of the Centre for Scientific research of El Salvador and the
National Centre for research in the Social Sciences, as well as research projects carried out. It does not have data on
the physical infrastructure and number of researchers belonging to them, but only short documents relating to the initial
planning.


41 Which can be traced back to the mid-80s where there is an abundance of failed experiments.


42 draft (march 2011).


43 The OECd Frascati manuals or UNESCO standards, for example.


44 Which can be defined as the ratio of the improvement in performance [from an innovation] to specific expenditure on
r&d incurred to achieved it, in a given period of time; alternatively as the ratio of the time required to achieve a specific
improvement to the cumulative effort required to achieve the improvement. Cf. Nordhaus (1969).


45 See, for example, Boekholt et al. (2001).




Innovation in the
agro-industrial sector




62 Science, Technology and Innovation Policy Review - El Salvador


Branch of Economic Activity**
1990


Millions of
dollars


2000
Millions of


dollars


2010 *
Millions of


dollars


1990
% of GDP


2000
% of GDP


2010
% of GDP


Growth
1990 - 2010


(%)


Agriculture, Hunting, Forestry and
Fishing 821 925 1,168 17.1 12.3 12.9 42.3


Green coffee 218 174 143 4.5 2.3 1.6 -34.6


Cotton 11 1 0 0.2 0.2 0.0 -100.0


Basic grains 160 171 198 3.3 2.3 2.2 23.2


Sugar cane 29 55 55 0.6 0.7 0.7 87.4


Other agricultural products(1) 116 165 289 2.4 2.2 3.2 149.1


Livestock 140 164 222 2.9 2.2 2.5 58.5


Poultry 73 120 154 1.5 1.6 1.7 111.2


Forestry 50 52 72 1.0 0.7 0.8 45.1


Hunting and fishing products 23 22 35 0.5 0.3 0.4 50.0


Agro-industry 485 704 895 10.1 9.4 9.9 84.5


Meat and meat products 40 33 35 0.8 0.4 0.4 -11.8


Dairy products 25 53 65 0.5 0.7 0.7 161.9


Fish products 0 0 0 0.0 0.0 0.0 200.0


Flour and bread 97 146 199 2.0 1.9 2.2 106.4


Sugar 38 123 158 0.8 1.6 1.7 310.2


Other processed food products 72 111 157 1.5 1.5 1.7 120.1


Beverages 111 151 177 2.3 2.0 1.9 59.0


Processed tobacco 37 0 0 0.8 0.0 0.0 -100.0


Leather and leather products 52 68 79 1.1 0.9 0.9 51.5


Wood and wood products(2) 14 21 26 0.3 0.3 0.3 79.0


National GDP 4,801 7,531 9,082 89.2


*= provisional data. **= selected branches based on their relation with agro-industry.
(1)= includes ornamental plants and flowers, (2) includes Peruvian balsam
Source: UNCTAD, based on data from 2011 published by the Central Reserve Bank of El Salvador (www.bcr.gob.sv).


Table 1. Agriculture and manufacturing, by branch of economic activity in millions of dollars (constant 1990 prices)
and as a percentage of GDP


A. AgRo-InduSTRy In
El SAlvAdoR


Agro-industry, that is the sub-series of manufacturing
activities whereby primary and intermediate products
derived from the agricultural, livestock, fisheries and
forestry sectors are processed (FAO, 1997), includes
a broad range of processes of varying degrees of
technological sophistication. It includes processes
which have an industrial and not merely an artisanal
component, and which range from mere preservation
of products and operations closely related to
harvesting, to the production, using modern methods
and heavy capital investment, of articles such as textile
products, paste and paper. Agro-industrial activity


is distinguished from other industrial sectors by the
seasonal nature of its raw materials, their perishable
nature and fragility, as well as their variability in terms
of quantity and quality.


Agro-industry is an important sector for El Salvador for
several reasons. Agricultural and agro-industrial activ-
ities represent 22.8 per cent of national GDP and 19.4
per cent of exports (Tables 1 and 2). Because agro-
industrial activity is based on agricultural inputs and
provides work opportunities in rural areas, it provides
a stimulus for agricultural and rural development and
poverty reduction. Agro-industrial activities encour-
age better use of agricultural products by improving
preservation and can help to improve food security.
In addition, agro-industrial processes add more value
to agricultural products and provide opportunities for




63Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


1995 2000 2005 2009 2009 (%)


Food and animals 699 681 589 812 16.2


… coffee and coffee substitutes 498 379 170 248 5.0


… sugar, molasses and honey 55 70 106 132 2.6


… sugar confectionery 8 18 12 16 0.3


… fish, crustaceans, molluscs and preparations 38 31 73 101 2.0


… milk, cream and derivative products (except butter and cheeses) 2 11 4 6 0.1


… cheeses and curds 0 0 3 6 0.1


Beverages and tobacco 13 26 49 98 2.0


Non-edible raw materials, except fuel 28 23 31 46 0.9


Oils, fats and animal and vegetable wax 8 8 7 11 0.2


Hides and products made from hides 2 1 2 3 0.1


Cork and wood products (except furniture) 2 3 2 2 0.0


Total agro-industry 751 742 679 972 19,4


Total exports of goods 1,645 2,941 3,418 3,797 75,8


Total exports of goods and services 2,040 3,640 4,546 5,007 100,0


Source: UNCTAD, based on Globstat and UNCTADStat data.


Table 2. Agricultural and agro-industrial exports of El Salvador (in millions of current dollars)


greater economic profits. Furthermore, given its geo-
graphical limitations, El Salvador has little chance of
succeeding as a producer of large volumes of agri-
cultural products, and its advantages will lie more in
the specialization in niche products, including agro-
industrial products. Even without having large agricul-
tural output in the country, it is possible to develop
an important agro-industry by importing raw materials
from other countries in the region, although this would
require greater trade integration in central America.


Although there are no specific figures for Salvadorian
agro-industry, the study of the principal branches
of the primary sector and those branches of
manufacturing industry based on processing of
primary products, shows a diverse set of activities. In
the last two decades, these economic activities, with
some exceptions, have shown growth but their weight
in the national economy has been reduced (Table 1).
The relative importance of sugar, dairy products, flour
milling and baking products and processed foods
should be highlighted. On the other hand, there is
a significant reduction on the production of green
coffee and the disappearance of cotton growing and
tobacco-related activities.


coffee remains the main Salvadorian agricultural ex-
port product, although it has lost ground as a propor-
tion of GDP. Sugar is the second biggest export prod-
uct. The evolution of production and exports of the


most important agro-industrial products is analysed
in part 1.2 of Section B.


B. dIAgnoSTIc of ThE
SySTEm of InnovATIon
In ThE AgRo-InduSTRIAl
SEcToR


This section presents a diagnostic of the system of
innovation in the agro-industrial sector. A great many
of the observations made here refer to agricultural
innovations and not specifically agro-industrial ones.
It is considered important to include these references
given the importance of the agricultural sector to agro-
industrial activities.


1. Production and execution function –
executing system


The principal agents which execute agro-industrial
are enterprises and agricultural producers. They
are supported by research, education and training
centres, the financial system, and support bodies
(see Figure 1). These activities are carried out in the
framework of the available overall and innovation-
specific infrastructure.




64 Science, Technology and Innovation Policy Review - El Salvador


Source: UNCTAD.


Figure 1. The principal agents involved in the system of execution and production


PRODUCTIVE ENTERPRISES


AVES


CENTA


UJMD


UCA


UES


ENA


Asociación Azucarera


CAMAGRO


BA


INSAFORP


BFA


BH


Chambers and
associations


Centres


Technological
institutes


RESEARCH, EDUCATION
AND TRAINING


PROinnova


AUTONOMOUS
SUPPORT BODIES


INFRASTRUCTURE


International cooperation


FOMILENIO


FUSADES


FIAGRO


FUNDE


FINANCIAL SYSTEM


Procafe


Agro-industrial innovation


General


Universities


1.1. Support infrastructure for
agro-industrial innovation


The growth of an innovative agro-industry in the
country will largely depend on the availability of a solid


infrastructure which facilitates product innovation and
marketing of those products.


El Salvador lacks the supportive infrastructure for pro-
moting agro-industrial innovation. In the first place, it




65Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


does not have a developed national quality system1.
There are difficulties in implementing quality systems
(due to the lack of qualified national human resourc-
es) which particularly affect smaller enterprises. In-
spection capacities to check and enforce sanitary and
phytosanitary standards are inadequate. Moreover,
shortcomings can be observed in the infrastructure
of good quality laboratories: some types of analysis
cannot be carried out in the country, training of labo-
ratory staff is not always adequate, and the infrastruc-
ture and equipment that is available is not properly
used. Although the development of quality systems
does not necessarily lead to innovation activities, it is
a prerequisite for commercialising the products. The
availability of a quality infrastructure also allows the
development of new products. The configuration of a
national Quality System (chapter II) and the availabil-
ity of financial and human resources to implement it
will be crucial to the development of agro-industry.


In the area of biotechnology, the country does not have
an infrastructure of research laboratories equipped for
advanced techniques in biotechnology2.


As regards the infrastructure for the development of
agro-industrial enterprises, it is worth mentioning the
work done by various programmes and organizations,
in particular PrOinnova and FIAGrO, to promote the
development of innovative agro-industrial enterprises.
however, there are no funds or permanent support
programmes for the incubation of agro-industrial
enterprises nor a business/technology park for agro-
industrial enterprises.


The experts consulted also pointed out the absence
of an organized system of collection centres or
wholesale markets to facilitate the commercialisation
of the inputs needed by agro-industry. Moreover, the
country has a limited number of suppliers of machinery
for agro-industry and depends on foreign suppliers.
In addition, the supply of packaging to meet the
requirements of different products is limited.


lastly, weaknesses in the overall infrastructure, in
addition to those mentioned in chapter I, should be
mentioned, as they affect agricultural production and
the marketing of agro-industrial products: a limited
cold store infrastructure at the international airport of
El Salvador, where there are no proper installations for
handling frozen or refrigerated products for export;
poor development of the road network in rural areas
which makes the transport of agricultural products
more difficult and more expensive and the slow down
in the modernization of water management.


1.2. Enterprises
As discussed below, three types of enterprises can
be observed in El Salvador, according to their level of
investment in r&D and innovation. Firstly, there are
a limited number of large and medium-sized agro-
industrial enterprises which carry out r&D activities
using their own resources, engage in innovation
activities (generally in the development of new
products and adaptation of processes), and recognize
the strategic value of innovation. The turnover of these
enterprises generally puts them outside the scope
of government support programmes for innovation.
Some of them have an innovation department with a
specific budget allocated. Others allocate budgets to
innovation on an ad-hoc basis. These enterprises tend
to acquire well-known foreign brands of machinery to
obtain correspondingly high quality products, they
obtain specialist technical assistance from abroad
or from recognized domestic consultants, and keep
themselves informed through foreign travel and
international contacts. Box 1 illustrates the experience
of two of these enterprises.


A second group comprises enterprises, mostly small
with some medium-sized, which seek all possible
public and private support to grow and become
exporters. Innovation is not a strategic element for
these enterprises, which tend to make their innovation
activities subordinate to the support they can obtain.


lastly, there is a group of subsistence enterprises,
with artisanal production processes which often do
not meet even minimum quality standards and which
have little capacity or interest in innovating.


There is no detailed information on the level of private
investment in r&D or innovation activities in agro-
industrial enterprises. In terms of the results of r&D,
there is some limited patenting activity in the country,
but this is mainly in the areas of health and veterinary
science, agriculture and the food industry. In total,
17 patents were identified in these three areas in the
period 2001-2010 (Annex D). however, the operating
rights for these patents are essentially owned by
foreign companies. For example, of the five patents in
the food industry, three are owned by a single foreign
multinational.


The agricultural and agro-industrial sectors consist
of a large number of subsectors, each with its own
particular conditions. This study has examined those
agro-industries which by virtue of their production
value, raw materials that they use and/or the labour




66 Science, Technology and Innovation Policy Review - El Salvador


Box 1. The experience of innovative Salvadorian agro-industrial enterprises


Case A. Nobs Hidrofusión – An innovative enterprise in essential oils


This company, with over 25 years’ experience in the cultivation of vetiver grass and other plants (aromatic, grasses,
ornamental) and trees (fruit and forest), went into the development of processes to extract essential oils. vetiver grass
is one of its principal products and is produced entirely for export. Thanks to the determination of processes, times and
extraction yields for different plant species, it has developed the production on a commercial scale of other essential oils.
Its r&D work was carried out independently, without support from any public institution, based on knowledge acquired,
studies and trial and error.


nobs hidrofusión opened the way into the international market for vetiver essential oil (chiefly in the united States and
the European union) with the support of foreign cooperation. At the request of its customers, it successfully modified
the extraction process to obtain top quality “haiti Type” vetiver essential oil – the vetiver oil for which there is the highest
demand and price in the international market. The first sale of 200Kg was made in 2008. The sales prices obtained are
well above the best purchase prices at international level. This super-price has been achieved by the excellent quality of
the product, shown by analyses carried out by a German laboratory and the certification obtained.


The company engages in three main activities. The sale of vetiver grass, a plant used to control soil erosion, was the main
source of income until 2008, when it was overtaken by sales of essential oils. The sale of trees and other grasses and the
construction of gabions generate modest but stable income. The third activity is the production and sale of essential oils
of vetiver, coffee, styrax and cascarilla.


Since 2008, it has been developing a project to sell biomass/foliage of vetiver plants to a sugar mill to use in the generation
of electricity. The first tests have been carried out and negotiations are at present under way with a sugar mill. FIAGrO
has supported the formulation of this investment project.


The company enjoys international recognition for its experience and the quality of its essential oils, which have international
certification such as the 100% organic certification issued by the German company BcS Öko-Garantie and the Kosher
certification issued by the rabbinate based in costa rica.


Sales of essential oils rose from less than 22,000 dollars in 2004 to 225,000 dollars in 2010. Projected sales for 2011 are
over 400,000 dollars.


Case B. Agroindustrias San Julián – A processing company which produces dairy products, raises pigs, produces
coffee, engages in forestry and produces charcoal.


This family agro-industrial company, founded in 1985, combines the manufacture of dairy products, breeding and fattening
of pigs, forestry, coffee using drip irrigation and vegetables. Through a strategy of horizontal integration, it maximizes
the use of its resources. The company has 47 hectares in the Department of Sonsonate, and a milk processing plant, an
animal food processing plant, pig breeding and fattening units, forestry for charcoal and fine woods, and production of
process coffee. It currently generates over 320 direct jobs.


Agroindustrias San Julián (Agrosania S.A. de c.v.) is one of the leading Salvadorian dairy companies and exports to
Guatemala, honduras, the united States and canada. It has been a pioneer at national level of the introduction of
new packaging (e.g. Zipper vacuum packs and Doy Packs with cream dispensers), the introduction of new products
in the market (such as loroco cream or dips made from cheese and natural ingredients). It has also been innovative
in production processes and is the only central American company which recovers milk solids using ultra filtration
equipment. Part of the whey and other by-products of the dairy plant are used for pig feed.


The company pursues a policy of quality differentiation and complies with BPM and hAccP quality standards, and is
currently in the course of obtaining ISO 22000 certification. It has also invested 750,000 dollars in installing a waste water
treatment plant, refrigeration and milking equipment, as well as modern steam boilers. These improvements introduced
over five years have generated excellent results in terms of quality and market share.


Thanks to the use of state-of-the-art technology in pig production, including imported genetic strains, automated feeders
and raised floors, optimum weights have been achieved in minimum time. The company has its own food factory and
solid separators for the use of the dung which, combined with charcoal waste, is used to produce organic fertilizer used
in shady woodlands in coffee plantations. It is currently engaged in a 200,000 dollar project for the production of methane
gas which will be used in the boilers and will allow energy savings of 12,000 dollars per month.


The forestry division has three production areas: coffee growing, forestry and charcoal production. It is the only company
in the country which has implemented drip fertigation in its coffee plantations. With an initial investment of 2,500 dollars
per hectare, this system has improved productivity to 35 quintals (1 quintal = 100Kg) of green coffee per hectare,
exceeding by far the national average of 6 to 8 quintals per hectare. They have an ecological process which can remove
the coffee pulp almost dry to save water. The resulting pulp is used in turn for the production of organic fertilizer.


(cont.)




67Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


Box 1. The experience of innovative Salvadorian agro-industrial enterprises (cont.)


The plantation of woodland provides shade for the coffee bushes. The managed pruning of these trees is used to
produce and market fine wood and as an energy source. The company has special furnaces which produce high quality
charcoal in only 72 hours, whereas artisanal methods require 15 days to produce charcoal of lower quality.


This company, for which r&D is a strategic element, has achieved sustained double-digit growth from its inception, based
on investment in innovation programmes using its own capital and bank financing. The chief sources of information it
uses to innovate are the Internet, foreign travel and contracting of foreign experts. The company gives prizes to its
workers who contribute innovative ideas, both to reduce production costs and to develop new products and services.
The company has had little government support, as it is considered large, but has received support from international
cooperation and non-governmental organizations. Its executives have been trained abroad and maintain contacts with
experts in other countries.


Source: UNCTAD based on communications with the managers of these companies.


that they employ, are most important to the Salvadorian
economy (Tables 1, 2 and 3). They are analysed
separately below.


The Agricultural and Agroindustrial Chamber of El Sal-
vador (cAMAGrO) is the most representative orga-
nization of the agricultural and agro-industrial sector,
and affiliates over 20 associations from various sub-
sectors. Its principal mission is to influence agricul-
tural and agro-industrial policies. It also collects and
processes strategic information for the sector and
provides services to promote its affiliates’ competi-


tiveness. cAMAGrO does not carry out or promote
innovation and technology transfer activities. Although
it has no particular commitment to the sphere of in-
novation, cAMAGrO could play an important role in
promoting a culture of innovation and the establish-
ment of appropriate conditions in which agro-indus-
trial innovation could prosper. It is worth noting that,
given the heterogeneous characteristics and widely
scattered nature of producers, cAMAGrO can only
represent a fraction of small producers.


1. Coffee industry


Number of
establishments


Total employees
at 31 August 2004


Coffee 014004 Coffee processing 51 4,612
154908 Coffee roasting and grinding 2 19


014007 Rice processing 10 472
Meat and
meat
products


1511 Production, processing and preservation of meat 31 3,536
….151103 Poultry slaughterhouses 4 2,050
….151105 Preparation, preservation and elaboration of meat products 17 1,454


1512 Elaboration and preservation of fish 7 1,946
1513 Elaboration and preservation of fruit and vegetables 18 515
1514 Elaboration of oils and fats of vegetable and animal origin 2 521
1520 Elaboration of dairy products 73 2,693
1531 Elaboration of flour milling products 12 886
Maize 1532 Elaboration of starch and derivative products 2,779 3,720


…. 153202 Milling of wet maize (milling for nixtamal) 2,710 3,600
1533 Elaboration of prepared feeds for animals 25 422
1541 Elaboration of bakery products 2,096 10,815
Sugar 154201 Manufacture and refining of sugar cane and other by-products (sugar


processing plants) 8 3,757


154202 Milling of sugar cane to produce sugar candy and other products (presses) 4 68
1543 Elaboration of cocoa and chocolate and confectionery products 27 616
1544 Elaboration of macaroni, pasta and similar 5 98


Source: UNCTAD, based on VII Economic Census 2005 (DIGESTYC 2005 and disaggregated data supplied by DIGESTYC).


Table 3. Number of establishments and jobs in Salvadorian agro-industry, according to the 2005 economic census




68 Science, Technology and Innovation Policy Review - El Salvador


2004/05 2005/06 2006/07 2007/08 2008/09


Total exports 1,711.8 1,668.9 1,591.5 1,913.9 1,791.3


Green coffee 1,707.8 1,665.0 1,587.9 1,911.9 1,789.6


.. of which special coffees 302.1 385.8 444.5 519.0 684.0


Processed coffee 4 3.9 3.6 2.0 1.7


Percentage special/green 17.7 23.2 28.0 27.1 38.2


Percentage processed/green 0.23 0.23 0.23 0.10 0.09


Source. Salvadorian Coffee Council, Salvadorian Foundation for Coffee Research (PROCAFÉ).


Table 4. Coffee exports, 2004 -2009 (thousands of quintals)


coffee production contributes 1.5 per cent of GDP
(Table 1) and is an important activity in family agricul-
ture, where small producers, account for 82 per cent
of producers, and 11.5 per cent of total production
(Procafé, 2010). The results of this agro-industry are
closely related to international prices of green beans.
As in other coffee producing countries, the added
value of exports is low because a high proportion is
green coffee. The development and export of pro-
cessed coffee (whole roasted bean or ground roast
and others) does not appear to be an option for El
Salvador, given the consolidated structure of interna-
tional specialization with, on the one hand, producer
countries like El Salvador and, on the other, process-
ing countries that have developed technologies and
competitive advantages in the business of roasting,
blending, and brand development and placement.


Furthermore, the production of special coffees
(including gourmet, fine, sustainable, fair trade and
organic coffees) has shown remarkable growth in El
Salvador. In the season 2008-2009, special coffees
accounted for 38 per cent of coffee exports (Table
4). According to the sources consulted, the premium
price on special coffees is over ten dollars per quintal.
The development of special coffees appears to be a
decision that would accord with the country’s current
potential.


The production of coffee itself faces major challenges
in terms of research, technology transfer and train-
ing, including agronomic management of production
(renovation of coffee plantations, disease and pest
control, etc.) and improvement of varieties. Productiv-
ity in coffee production has fallen markedly in the last
twenty years (see Procafé, 2010) mainly due to the
ageing of plantations. renovating the coffee planta-
tions is thus a fundamental task. Investment in tech-
nological infrastructure (e.g. drip irrigation) would also
help to improve productivity. For example, one of the


business owners interviewed confirmed that the intro-
duction of drip irrigation improved productivity from 8
to 38 quintals of green beans in a single season. The
majority of innovation and research efforts have been
concentrated in production (for further details, see the
work done by PrOcAFÉ in section 1.5).


Although in general, low levels of innovation can be
observed in coffee processing, there are success
stories of innovative companies which have developed
high added value products such as special coffees and
have even made important organizational innovations
such as developing a vertical business like coffee
cup, a successful franchise serving coffee to the final
consumer (see Box 1 in chapter 2). The expansion
of this type of organizational innovation is limited by
the size of the domestic market and international
competition, but there is ample scope for developing
the special coffees sector.


2. Sugar industry3


Annual sugar sales topped 200 million dollars in
2009, 45 per cent of which were for exports. The area
under sugar cane cultivation and the volume of cane
harvested and sugar produced has remained fairly
stable in recent years. Productivity levels have remained
constant (variations in yields of sugar extraction can
be basically explained by meteorological conditions
which affect the sugar content of the cane), and
have remained within international standards4. These
satisfactory yields are due to the use of imported
machinery from Brazil and the united States, the use
of plants of good genetic quality (in vitro reproduction
in the national School of Agriculture (EnA)) and the
technical assistance provided to the producers.


Sugar companies use similar technologies and
competition in the sector is limited, as the profitability
of the chain is influenced by transport costs from
producer to factory.




69Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


Of the six factories5 in the country, four have an
innovation manager (Izalco, El Ángel, la cabaña and
chaparrastique). All the factories are certified in ISO
9000 as well as in Kosher and in Good Manufacturing
Practice. One of the principal sources of innovation
for these enterprises is the adoption of technologies
or adaptation of existing technology similar to that
observed in other countries, as for example the
adoption of processes for self-generation of energy
using cane pulp.


In the last four years, the sugar industry has improved
its sugar refining capacity in two refineries, increasing
the proportion of sales of refined sugar to 20 per cent
of total sugar exports.


The Sugar Association of El Salvador is the trade
organization which groups the six sugar factories
(sugar cane processing plants). It is a consolidated
organization but does not include the entire productive
chain. The association has promoted the interests of
sugar factories but has not promoted the development
of new products.


There is also a small rural and artisanal industry pro-
ducing panela6 for domestic consumption. Officially,
the 2005 economic census shows that there are only
four establishments (presses). however, in reality, the
number of establishments is somewhat higher, due to
the fact that the majority are informal rural micro-enter-
prises. Opportunities to export this product exist and
with the necessary support, in terms of technological
development, quality, and organization which allows
economies of scale, this small agro-industry would
have growth potential


3. Honey and its derivatives


El Salvador has over 68,000 hives distributed in
2,050 apiaries (MAG, 2009) and ninety per cent of
the production is exported, mainly to Germany. In
2010, exports of honey were over five million dollars.
Exports are mainly in bulk although cosmetic products
and food supplements based on honey have been
developed, as well as natural medicine by-products.
The private sector has been supported by international
cooperation agencies and, in specific cases, by
certain government institutions, especially for opening
markets. As far as it is known, no research programme
for the development of honey-based products exists
in El Salvador.


The National Bee-Keeping Commission of El Salvador
(cOnAPIS), created in 1998 by executive decree of


the Ministry of Agriculture and livestock, operates like
a trade association and has provided technical training
for bee-keepers to improve the yield of hives and the
quality of the products. This technical training has been
provided by a team of nine cEnTA experts who were
expressly trained in bee-keeping. By 2005, they had
trained 374 bee-keepers who own over 34,000 hives
(Gochez 2008). Given its limited availability of funds,
cOnAPIS has had difficulty in continuing to provide
financial support for the work of the cEnTA experts.
It should be noted that its principal guidelines do not
include support for research into the processing of
honey and its derivatives.


4. Processed fishing and fish-farming products


In 2010, the fishing sector exported over 65 million
dollars of processed fish products7 (chiefly tuna
steaks) and the fish-farming sector represented some
ten per cent of fish and fish-farming exports in 2006
(Table 5).


up to the end of the nineties, shrimp fishing was
the main activity of the Salvadorian fishing industry.
Over-fishing and the effects of natural phenomena
have reduced its importance. nowadays, the tuna
industry is the main commercial fishing activity. The
calvo Group set up in 2002 with a tuna plant in Puerto
de la unión, which employs over 1600 workers. This
plant processes tuna steaks for export to Spain where
they make high added value products, some of which
are then imported into El Salvador to satisfy domestic
demand. Artisanal fishing accounts for some 50 per
cent of the total volume of fishing.


Since 2001, fish-farming8, especially inland fish-
farming, has developed considerably, driven by
support from international cooperation (university of
cantabria, undated). The main products are marine
and freshwater shrimps and tilapia. The development
of this sector will depend, among other things, on the
sector’s capacity to respond to problems of water
quality, seed quality or diseases associated with
shrimps. In these areas, research and technology
transfer have an important role to play. Although
specific research is being done, in farming of tilapia,
for example, there is no national fish-farming research
programme.


nor, as far as it is known, has research been done in
El Salvador on the processing of fish and fish-farming
products.




70 Science, Technology and Innovation Policy Review - El Salvador


Millions of dollars % of total fish and fish-farming exports


Industrial fishing 43.6 60.7


Marine artisanal fishing 18.4 25.6


Inland artisanal fishing 3.4 4.7


Total fishing 65.4 91.1


Inland fish-farming 5.1 7.1


Marine fish-farming 1.3 1.8


Total fish-farming 6.4 8.9


Total fishing and fish-farming 71.8 100.0


Source: Fishing and Fish-Farming Statistical Yearbook 2006 (CENDEPESCA) according to University of Cantabria (undated).


Table 5. Production of the fisheries and fish-farming sector, 2006


5. The maize industry


Maize cultivation is a primary step for a large number
of economic activities (e.g. production of tortillas,
pupusas, y tamales). The area sown with maize has
remained stable although output and yields vary
from year to year, chiefly due to climatic conditions.
A slight increase in productivity can be observed
(Figure 2), thanks to technological improvements and
government programmes which supply improved
seed to small farmers. Although white maize is the
most widely cultivated crop, El Salvador imports
some ten per cent of the white maize consumed in the
country (Ángel, 2008).


In the white maize industry, there are two types of
enterprise. On the one hand, we find two large com-
panies which process nixtamalized white maize9 for
human consumption (DIGESTYc 2005). To make this
flour, they use imported machinery and technologies.
According to Trade Map data, El Salvador exported
32 million dollars of nixtamalized maize to the rest of
the central American region in 2010. These exports
are mainly from one of the companies, as the other
major company is part of a transnational with plants
in several countries in the region. Exports of flour have
been growing strongly (2001-2007) and much of the
imported white maize ends up being re-exported as
flour (Ángel 2008).


The other segment consists of over 2,700 artisanal
maize flour mills distributed throughout the country.
These companies use machinery which was originally
imported, but workshops can be found now in the
country which make it and provide repair services.
This traditional sector does not generally apply safety
standards and does not differentiate its products.
An exception is those medium-sized enterprises


which used nixtamalized maize soda dough to make
tamales and/or pupusas, which they package and
freeze and sell mainly in the nostalgia market in the
united States.


There are two Salvadorian companies which make
snacks based on yellow maize which sell their
products in the domestic and international market
(Ángel, 2008). All the yellow maize consumed in the
country is imported.


6. The rice industry


rice is one of the most important components of the
Salvadorian diet but its production in the country is
limited. ninety per cent of the consumption of gold
rice is imported (Ángel 2008).


There are ten rice processing companies which
generate 472 jobs (DIGESTYc 2005). For some
years, the main companies have incorporated new
processes and products generating pre-cooked rice,
rice flour and, in at least two of them, lines unrelated
to rice have been developed, making incursions into
the food and drinks area, especially for export to the
ethnic market in the united States. The machinery
and technology used come mainly from the united
States.


7. The beans industry


The cultivation of beans is characterized by great
variability, both in area under cultivation and total
production (Figure 3). The differences in productivity
fall within the normal range, given the great influence
of levels of precipitation and climatic phenomena on
this crop. The great variations in area under cultivation
are mainly due to farmers’ expectations, prior to
sowing, of the price of the future harvest.




71Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


Figure 2. Cultivated area, production and yields of maize, 2005-2011


Area (hectares) Yield (quintals per cultivated hectare)


Ar
ea


(h
ec


ta
re


s)
Pr


od
uc


tio
n


(q
ui


nt
al


s)


Yi
el


d
(q


ui
nt


al
s


pe
r c


ul
tiv


at
ed


h
ec


ta
re


)


2005/2006 2006/2007 2007/2008 2008/2009 2009/2010 2010/2011
0


10


20


30


40


50


60


-


5,000,000


10,000,000


15,000,000


20,000,000


25,000,000


Production (quintals)


Source: UNCTAD, based on data from the Agricultural Statistical Yearbook, MAG.


Beans are one of the crops which form part of the basic
diet of the majority of central American countries.
having sufficient levels of supply at an affordable
price is crucial for all the countries in the region. The
impact of policies to promote production of beans
(e.g. distribution of improved seed to small farmers)
has not been sufficient to respond to the growth in
demand. Policies are often adopted which discourage
exports (e.g. exclusion from free trade agreements
with countries outside the central American area)
(IIcA 2008).


There are opportunities to improve productivity through
technical programmes on seed selection. At present,
many small farmers select from their own grains for
use as seed, without adequate technical support.


The transformation of beans into added value products
such as, for example, boiled and fried beans packed
in cans, packets or doy packs has increased in im-
portance in the last decade. no specific information is
available on this industry, as beans are just one product
among many in companies’ processing lines.


Figure 3. Cultivated area, production and yield of beans, 2005-2011


Area (hectares) Production (quintals) Yield (quintals per cultivated hectare)


Ar
ea


(h
ec


ta
re


s)
Pr


od
uc


tio
n


(q
ui


nt
al


s)


Y
ie


ld
(q


ui
nt


al
s


pe
r c


ul
tiv


at
ed


h
ec


ta
re


)


-


500,000


1,000,000


1,500,000


2,000,000


2,500,000


2006/2007 2007/2008 2008/2009 2009/2010 2010/2011
0


2


4


6


8


10


12


14


16


Source: UNCTAD, based on data from the Agricultural Statistical Yearbook, MAG.




72 Science, Technology and Innovation Policy Review - El Salvador


8. The sorghum industry


Sorghum is mainly used for poultry and animal feeds
and its production is a traditional agricultural activity.
To a more limited extent, sorghum flour is used in some
common bakery products (it is mixed in proportions
of not more than 30 per cent with wheat flour). In the
poorest rural families, it is a human food resource.
cEnTA has, for several years, been developing and
encouraging the use of sorghum in bakery, obtaining
good quality products from sorghum flour. Sorghum is
also a grain which represents an important raw material
for the manufacture of prepared animal feeds.


9. Dairy processing industry10


Two types of dairy processing enterprise can be
found in El Salvador. On the one hand, there are a
large number of artisanal enterprises which process
milk without acceptable hygiene standards (e.g. un-
pasteurized milk). On the other, around ten formal
companies have hygienic processes and use pas-
teurized milk and the latest generation of machinery.
The largest companies have innovation departments
or managers for the development and launch of new
products. They receive international advice and, in at
least one case, have support from foreign technicians
to maintain the equipment. This group of companies,
together with the poultry industry, invest most in in-
novation. They are accustomed to launching a least
two new products per year in the market and inno-
vation forms part of their business strategy. Innova-
tion chiefly involves importing foreign technology and
training, purchasing of technological services abroad,
investment in quality control, and internal product de-
velopment (sometimes by trial and error). The main
sources of information for innovation are attendance
at fairs or specialist tours and participation of employ-
ees in product development. These processors have
professionals who have been trained abroad, espe-
cially post-graduate training. These companies do not
form partnerships with other domestic companies, but
only with milk suppliers, and markets are developed
individually.


Milk production amounts to about 500 million litres per
year, of which six per cent is destined for own con-
sumption, 13 per cent is processed in artisanal busi-
nesses without acceptable standards of hygiene (un-
pasteurized milk), 23 per cent is sold for consumption
as fluid milk and 58 per cent is processed by dairy
plants which use good practices (MAG, 2009). Milk
production is also characterized by two different sce-


narios. On the one hand are specialized dairy farms
(accounting for only three per cent of the herd but
producing 40 per cent of total milk output) which use
hygienic milking methods and apply adequate health
practices. The other group of companies, dairy and
beef farming, mainly produces milk without applying
hygienic practices in milking.


Exports of dairy products, chiefly cheeses, represent
between 10 and 20 per cent of domestic production.
The principal dairy products exported are cheeses. El
Salvador imports milk to satisfy domestic demand.


10. Poultry industry


This industry, which accounted for 1.7 per cent of na-
tional GDP in 2010 (see Table 1) has a high level of
technology and management, although for some time
its products were the traditional ones (eggs, fresh and
frozen chicken). For over a decade there has been a
move to the development of higher added value prod-
ucts (first cutting and selling pieces, later developing
a range of prepared packed and fast-food chicken
products). competition between companies is strong
and product innovations are quickly copied by other
companies in the country. Innovation in this sector
has been possible thanks to the professionals trained
abroad. The results obtained have led these compa-
nies to step up their r&D activities and launch two to
three new products on to the market each year.


The El Salvador Association of Poultry Farmers (AvES),
which has a membership of over one thousand poultry
farmers, has organized the industry and successfully
defended its interest, but it depends on the capacity of
the Ministry of Agriculture and livestock to consolidate
epidemiological surveillance programmes and
maintain the country’s sanitary status free of avian
diseases. In addition, there are also a large number
of unrepresented family poultry farms which national
sanitary programmes do not cover.


11. Prepared animal feeds


The development of the poultry, pig and cattle industry
has stimulated the growth of the prepared animal feeds
industry (i.e. balanced mixtures of pelleted nutrients
intended for animal feed). For example, the largest
manufacturer of prepared animal feeds belongs to a
group which owns a poultry business.


The bulk of the raw materials used in the formulation
of prepared animal feeds (soya flour, yellow maize and
sorghum) are imported and supply chain integration




73Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


with local grain producers is very limited. In addition,
cattle farmers buy sugar cane molasses to add energy
to food rations. Seventy per cent of yellow maize and
sorghum imported from the united States is used to
make concentrates. All the soya flour needed for this
purpose is imported (Ángel, 2008).


Driven by their customers’ demands, especially in the
poultry sector, the concentrated feeds industry has
developed high quality standards.


Statistics from the El Salvador Association of
Poultry Farmers (AvES)11 show that production of
concentrated feeds rose between 2004 and 2007.
The fall seen in 2008 probably reflects expectations of
lower consumption with the onset of the global crisis.


12. Essential oils and resins


The essential oils industry is relatively small and is
concentrated in just a few companies. This industry
requires the use of specialized machinery, equipment
and processes, as well as of scientific knowledge
regarding oil extraction and filtration to enable the
elaboration of products with a quality acceptable to
the international market (the domestic market is very
small).


Peruvian balsam is a resin of El Salvador traditionally
used in the production of natural medicines and which
is also used for essential oils, cosmetics and foods.
The production of balsam is an artisanal extraction
activity which has not changed its methods since
colonial times. It is carried on by small farmers who
supply their product to collectors or exporters. At
present, this resin, whose quality is superior to that
obtained in other countries, is exported unprocessed.
If r&D activities were undertaken, the balsam could
have greater added value.


neither the essential oils nor the resin industry make
a significant contribution to the current economy, but,
given the growth in consumption of natural products,
development opportunities for this sector exist if value
can be added to these products. The processing of
balsam, even employing basic processes such as
filtration, is already an important source of added
value. complying with international quality demands
is the main concern of today’s producers.


One of the companies in this sector12 is concentrating
on extraction of essential oil from lemon grass,
another is constantly experimenting with the extraction
of various essential oils (including coffee, vetiver,
cascarilla, styrax and liquidambar) and has managed


to developed a fairly wide and flexible range of
products to adjust to market demand.


Domestic production is still small. There are no
specific data on domestic production, but the volume
of exports (Table 6) gives an approximation of total
production. It should be noted that the export turnover
of one of the main companies shows figures higher
than those shown in the Trade Map database.


Products 2008 2009 2010


Essential oils, nse* 98 93 198


Balsam 1,414 485 886


*nse: essential oils not specified elsewhere.
Source: Trade Map, International Trade Centre.


Table 6. Exports of essential oils and balsam,
2008-2010 (in thousands of dollars)


13. Fruit and vegetables


no reliable and sufficiently disaggregated up-to-date
statistics are available, but it is estimated that a around
70 per cent of fruit and vegetables consumed in the
country (both as human foods and agro-industrial
transformation) are imported.


The supply of fruit and vegetables, and products based
on fruit and vegetables, is highly diversified. Table 7
shows the principal exports. The vegetable sector
has concentrated in the development of products
of Salvadorian cuisine (tamales, pickles) destined
for sale to Salvadorian emigrants living in the united
States. There are a growing number of enterprises
in the processed tropical fruit sector, in mainly micro
and small enterprises that are developing products,
albeit on a small scale and with little innovation and
differentiation. Due to the stimulus given by the
planting of orchards (see the MAG national Orchard
Programme), there is beginning to be a national
supply of some tropical fruits of varieties accepted in
international markets (although the export of the fresh
fruit is limited by phytosanitary requirements).


The supply of raw materials for this industry is a
critical factor. El Salvador has difficulty in expanding
domestic production. Investments in technology
(protection and irrigation systems, improved access
to water sources) are required throughout a scattered
area. Furthermore, other countries such as Guatemala
and honduras have lower production cost structures.




74 Science, Technology and Innovation Policy Review - El Salvador


2008 2009 2010


Coconuts, Brazil nuts and cashew nuts (merey, cajuil, anacardo) 427 536 317


Citrus fruit, fresh or dried. 946 739 1,860


Fruit and nuts, uncooked or cooked by steaming or boiling in water, frozen 1,596 1,552 1,325
Total Fruit 2,969 2,827 3,502


Other vegetables 3303 3846 3421


Beans, including shelled, cooked, frozen 1146 1103 946


Peppers, genus capsicum or genus pimiento 2784 2115 2466


Other fresh or refrigerated vegetables 487 556 486


Common beans, dried, shelled 9,200 5,197 2,869


Total Vegetables 17,061 13,221 10,422


Source: UNCTAD, based on data from TradeMap database.


Table 7. Principal fruit exports, 2008-2010 (in thousands of dollars)


Against this background, the growth of these agro-
industries requires the development of agreements
with regional suppliers.


In the ethnic food, fruit and vegetable industry,
innovation activities are focused on the development of
processes for the manufacture of traditional products
on an industrial scale, including standardization of
processes and the adoption of food safety measures.
These developments take place individually at
company level – each company tries to keep its
formula secret and there is no collaboration between
them.


14. Natural dyes


El Salvador’s aniline or indigo has special quality
characteristics due to the concentration of indigotine.
During the colonial period, it was one of the principal
export products of El Salvador. It is an industry with
enormous possibilities of expansion and integration in
the future. For some years, efforts have been under
way to reactivate its cultivation, processing and use
in products dyed with aniline. In this regard, research
is needed into the extraction of the dye, as the “point”
is still determined in the traditional way, by eye, by the
person in charge. Because scientific parameters are
not used, qualities and yields are not standardized.


15. Textiles industry


While the Salvadorian textiles industry makes an
important contribution to GDP (chapter I), at present
it is based on assembly for re-export which uses
imported inputs and does not have any links with local
agro-industries. Inputs for the local textiles industry
are also imported.


1.3. Financing
There is no explicit information, but the agro-industrial
sector claims to have difficulty in financing its activities
in general and innovation in particular. At the end of
2010, less than four per cent of the total value of
loans granted by financial institutions were for the
agricultural sector 13. Of the 325 million dollars lent to
the agricultural sector, the Agricultural Bank lent 26
per cent of the total value of loans. The Agricultural
Promotion Bank and the Banco hipotecario lent 24
and 19 per cent respectively.


The development finance institutions in El Salvador
are those which are making the greatest efforts to
help the agricultural sector. According to data of the
Superintendency of the Financial System, in 2010, the
Agricultural Promotion Bank (BFA) allocated 58 per
cent of its portfolio to the agricultural sector and the
Banco hipotecario (Bh) 17 per cent. For their part,
private banks allocate an average of three per cent of
their portfolio to agricultural loans, although it should
be highlighted that the Banco Procredit allocated nine
per cent of its portfolio to this sector.


In addition, as an indication, less than ten per cent of
the total value of loans granted in 2010 were for the
manufacturing industry.


As described in chapter II, a national development
bank is being created which will eventually include
venture capital. For this bank to be a key element in
the financing of innovation in the agro-industrial sector,
it will be necessary to promote change of mind-set
to one which encourages investment in innovative
projects even if they carry greater risk. It will also
be necessary to have specific capacities to finance




75Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


technological projects in the agricultural and agro-
industrial area. In addition, PrOinnova is promoting
the development of investment angels.


The Special Agricultural Development Trust (FEDA),
created in 1996, is intended to promote modernization
of the agricultural and agro-industrial sector by means
of long-term financing of investments which increase
production, employment and competitiveness in the
agricultural sector. FEDA allocates funds to an interest
rate subsidy of three percentage points on loans
granted by intermediary financial institutions from their
own resources. The operation in the agro-industrial
sector has been limited because the intermediary
institutions require loan applicants to satisfy the same
requirements as those established for other economic
activities.


FOEX-FONDEPRO is the only fund in the country which
offers lines of support and credit to agro-industry.
This non-reimbursable fund is aimed at MSMEs (i.e.
enterprises with annual turnover of less than seven
million dollars) and co-finances up to 70 per cent
of the total value of the project. In the adoption of
technology line (machinery and equipment) support
up to 60 per cent is provided to a an enterprise which
presents a project individually and up to 70 per cent
in the case of a group of enterprises in association.
The fund’s maximum contributions are 25,000 dollars
for individual projects, 100,000 for group projects,
15,000 for specific group activities and 75,000 through
competition as seed capital for projects of innovative
entrepreneurs. These funds are limited in amount
and insufficient to meet total demand from small and
medium-sized enterprises.


The fund has five lines: innovation and technology,
quality and productivity, productive chains and
association, market development and innovative
enterprise. The innovation and technology line co-
finances visits by international experts, university
advice to companies, consultancy services for product
design, improvement and certification, specialist
product and process testing services, and the
acquisition and adaptation of technologies provided
that they allow improvements to productive processes
and do not merely increase installed capacity. This
line represented about half of the 1.8 million dollars
allocated in 2008 (vicens and Stark, 2009). In all, over
900 proposals were financed between 2002 and 2008
for a total amount of 5.4 million dollars. The impact of
this financing was reflected in the export performance
of the beneficiary companies. Exports of these


companies rose by 136 per cent between 2002 and
2008. Moreover, the rate of growth of exports of non-
traditional products of these companies was above
the national average. The programme management
is recognized as good, but it is faced with problems
of financing, as it does not have a regular supply of
funds.


1.4. Organizations which disseminate
knowledge


The supply of professionals in the areas related to agro-
industry is not adequate. Every year 150 engineers
and 150 technicians graduate in agro-industry related-
areas (Table 8), but the quality of the education does
not meet the expectations of the private sector.
Moreover, the lack of more advanced and specialized
education is a major weakness. currently, there are
no doctorate course offers in areas related to agro-
industry and the number of graduates with master’s
degrees is still small.


The private sector also said in the interviews that the
current supply of technological services does not
meet the needs of agro-industrial companies.


The National Centre for Agriculture, Livestock and
Forestry Technology (CENTA) (section 1.5) provides
technology transfer and extension services, including
in the agro-industrial area. In the technology transfer
sphere, cEnTA has a Technical Supervision unit,
35 extension agencies and a technical training unit.
cEnTA’s technology transfer activity is limited. For
more than 12 years, the staff have been assigned
functions of distributing seed and inputs to small
producers which, although necessary, consumes
scarce resources and diverts technical extension
staff from their proper technology transfer functions.
It is estimated that some 70 per cent of staff time is
devoted to the distribution of agricultural packages,
displacing resources available for research and
technology transfer activities as such (ruTA, 2010).
cEnTA suffers from budgetary problems and limited
links with the private sector.


The National School of Agriculture (ENA) provides
training for professionals in the agricultural sector.
The institution stands on 210 hectares of land where
the soil is high quality, and where its students can
“learn by doing”, cultivating basic grains, fruit and
ornamental trees. It also has dairy and beef cattle,
pigs, bees, rabbits, goats, sheep and fish-farming.
The school also has a dairy, fruit and vegetable




76 Science, Technology and Innovation Policy Review - El Salvador


processing plant, in which the students learn the
basics of these agro-industrial processes. The EnA
offers studies in agronomic methods, and graduates
can continue their studies in the José Simeón cañas
central American university and take the agro-
business degree. This school has trained the majority
of agronomic technicians working in the country. The
school’s main obstacle is its limited budget which,
among other things, affects the recruitment of top
quality teachers.


Dr. José Matías Delgado University (UJMD)
The Food Engineering Faculty provides the education
most related to agro-industry. Its small budget limits
the purchase and renovation of the latest machinery
as well as better salaries for the teaching staff. There is
no information available regarding research activities
of this faculty, which seems to indicate that such
activities are limited.


José Simeón Cañas Central American University (UCA)
The Department of Process Engineering and Environ-
mental Sciences provides laboratory and research
services to companies in general.


University of El Salvador (UES)
Provides training in agro-industrial engineering,
agronomic engineering and a degree in veterinary
science. There is no known research by the uES in
the agro-industrial field.


Zamorano University of honduras.
Although located in honduras, this Pan-American
school is very important to El Salvador’s agro-industrial
activity because of its proximity to the country, its high
standard of education and the technological services
that it provides. It currently provides degree-level
education in the food industry and agro-business
management.


1.5. Organizations which generate
knowledge


cOnAcYT’s statistics show little research activity in
agricultural sciences in Salvadorian universities and
technical institutes. El Salvador is one of the central
American countries which invest least in agricultural
research, both in absolute terms and as a proportion of


Institution
Student population Graduates


2005 2006 2007 2008 2009 2005 2006 2007 2008 2009
Master of energy resource
management UDB - - - - 9 - - - - -


Master of agronomics UES - - - 1 - - - - 1 -
Master of environment and
natural resources UCA 27 17 51 35 17 - 5 8 4 8


Master of science and food
technology UJMD - 7 5 - - - - - - 2


Subtotal: postgraduates 27 24 56 36 26 0 5 8 5 10
Degree in agro-ecological
studies


Lutheran
U. 110 101 114 106 67 6 25 26 8 3


Degree in agro-industrial
studies


UES,
UJMD - - - - 62 - - - - 19


Degree in agronomics UES, UO, UNICAES 770 690 704 698 822 106 93 83 84 65


Degree in food technology UJMD 195 222 229 283 336 20 9 6 11 18
Degree in agro-business
management UJMD - - - 4 18 - - - - -


Degree in veterinary science UES, UO 511 511 577 606 601 23 14 35 35 41
Degree in agro-business UCA - - - 10 10 - - - - -
Subtotal: graduates 1.586 1.524 1.624 1.707 1.916 155 141 150 138 146
Agronomics technician ENA 99 131 158 250 323 33 36 30 45 -
Food preparation technician UJMD - 351 423 429 446 - 73 107 164 151
Subtotal: Technicians 99 482 581 679 769 33 109 137 209 151


UES, University of El Salvador; UJMD, Dr. José Matías Delgado University; UO, Oriente University, UCA, José Simeón Cañas Central
American University; UNICAES, Catholic University of El Salvador.
Source: UNCTAD, based on MINED (2010) and information available on institutional websites.


Table 8. Education in agro-industry related subjects, El Salvador, (2005-2009)




77Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


Number of agencies studied R&D expenditure(millions of 2005 dollars)
Number of researchers
(full-time equivalent)


Belize 7 2.6 16.7
Costa Rica 16 29.9 282.9
El Salvador 6 5.7 76.9
Guatemala 7 8.3 102.4
Honduras 12 11 123.7
Nicaragua 8 24.1 133.4
Panama 7 10 166.7


Source: UNCTAD, based on IFPRI-IICA 2008.


Table 9. Agricultural research and development: El Salvador in the Central American context, 2006


agricultural domestic product (Table 9). As described
in chapter I, only five per cent of investment in r&D
by higher education institutions is destined for the
agricultural sciences and ten per cent to engineering
and technology. On the other hand, 40 per cent of
researchers (50 persons) work in the agricultural
science field. The number of researchers in agricultural
sciences has declined considerably. In 1981, there
were 120 full-time equivalent researchers, but by
2006, this number had fallen by 35 per cent (IFPrI-
IIcA 2008). A matter of concern is that Salvadorian
researchers are the least qualified at regional level.
In 2006, one researcher in five had a postgraduate
qualification (IFPrI - IIcA 2008).


In El Salvador, a high percentage of research is
financed by the Government and carried out by public
institutions, in particular, cEnTA. higher education
institutions have little capacity for research in the
agricultural sphere. In 2006, 78 per cent of full-time
equivalent researchers in agricultural sciences were
working in public institutions, and although there
was increased involvement, researchers in higher
education institutions only accounted for 13.8 per
cent of the total.


The bibliometric analysis (Annex F) indicates that
categories in which there are the most publications
include plant sciences, agronomics, biology and
zoology. On the other hand, these are not areas in
which the greatest impact is achieved. In terms of
impact, the publications which stand out are in food
science and technology, ecology, microbiology and
fisheries. however, these publications rely on the
involvement of a primary author not resident in El
Salvador.


The National Centre for Agriculture, Livestock and
Forestry Technology (CENTA) has the mission of
regulating, planning and managing the support for


the generation and transfer of technology, as well
as technical assistance in agriculture and forestry.
For its research activities, it has a Technological
research Management Department, which includes
biometrics and socio-economics units, experimental
station, seed technology, research laboratories and
programmes. The centre mainly carries out research
into staple grains, with good results in the development
of genetically improved lines. The research is carried
out under agreements with international research
centres such as the International Maize and Wheat
Improvement centre (cIMMYT). This research work is
a response to the value of promoting the supply of
staple grains for domestic consumption, but is little
related to farmers’ needs (ruTA, 2010). The other
research areas are more limited. In the agro-industrial
field, cEnTA presents results of agro-industrial
processes applicable to small producers but with
limitations with regard to the development of products
on a large scale.


For a couple of decades, the institution has been
faced with serious budget problems, which have
been reflected in staff reductions and the number of
extension agencies, as well as a lack of resources
to operate properly in the areas of research and
technology transfer. various efforts to strengthen the
institutions have had limited success.


The EnA carries out research in many areas. Of par-
ticular note is the work done on sugar. The Sugar As-
sociation of El Salvador recognizes EnA’s contribution
in the in vitro production of vegetable material from
sugar cane as very valuable. It should be noted, how-
ever, that, in 2009, less than one per cent of the annual
budget of 2.3 million dollars was allocated to scien-
tific research activities (MInED 2010). Furthermore,
the level of education of the staff of the school limits
the level of research that it can do. In 2009, EnA did




78 Science, Technology and Innovation Policy Review - El Salvador


Box 2. PROCAFÉ - Supporting research and technology transfer


PrOcAFÉ, a private foundation financed by coffee-growers, supports the coffee sector with research and technology
transfer, and provides technological services to the coffee industry. It has three coffee technology centres for the validation
of varieties, production of certified seeds and coffee seedlings. It also has a beauvaria bassiana fungus laboratory to
combat coffee borer beetles (the most damaging pest for coffee bushes).


The research activities are centred on the development of new varieties, agronomic management of coffee bushes,
including pest control, and the development of special coffees. The results of this research include the launch of cuscatleco
coffee (a coffee variety with high yields) and the development of a borer beetle trap. The principal technological services
provided by PrOcAFÉ included soil and leaf analysis, and the development of diagnostics and investment projects for
producers applying for credit. The majority of the research, technology transfer and innovation activities are related to
coffee-growing, and to a limited extent to coffee processing (i.e. selection, roasting and marketing). however, PrOcAFÉ
has also supported training in roasting and tasting of coffee and has been promoting the development of the appellation
of origin of Apaneca-Ilamatepec coffee.


The Foundation is financed two-thirds from a levy on coffee-growers of 0.5 dollars for every quintal of green coffee
supplied by the producer and processed by the roaster, processor or export processor15. The other third is funded
by income from the provision of specialist services and products. The funds available for PrOcAFÉ’s research thus
fluctuate with coffee production.


PrOcAFÉ participates in PrOMEcAFE, the regional cooperation Programme for the Technological Development
of coffee-Farming in central America, Panama, the Dominican republic and Jamaica and collaborates with other
international institutions such as the International centre for Tropical Agriculture (cIAT) based in colombia and the
centre for Agronomic research for Development (cIrAD) in France for the development of the coffee borer beetle
trap. PrOcAFÉ has collaborated with the university of El Salvador in student theses and work experience and provides
training through various secondary education institutions.


Source: UNCTAD, based on PROCAFE (2010) and PROCAFE information available at www.procafe.com.sv


not have a single teacher with a postgraduate qualifi-
cation and 20 per cent of the teachers had technical
level education MInED (2010).


The National Centre for Fisheries Development
(CENDEPESCA), under the MAG, is the national
fishing authority responsible for research and
regulation of fishing at national level. Despite the
lack of an adequate budget, specialist staff and
technical resources to carry out the various research
required for the development of the sector and the
design of regulatory measures, it has been possible
to carry out important studies thanks to international
cooperation14.


The Salvadorian Foundation for Coffee Research
(PROCAFÉ) was created in 1990 as a result of the
privatization of the Salvadorian coffee research
Institute. This private institution is financed and
managed by coffee-growers through representatives
of the country’s four coffee trade associations.
PrOcAFÉ supports the coffee sector with research
and technology transfer, and provides technological
services to the coffee industry (see Box 2).


cEnSAluD has facilities for microbiological analysis
of food and waters but does not have paid posts for
researchers and does not offer services to the private
sector.


Agricultural research activities are concentrated on
crops (over 90 per cent of time is devoted to research
in this area) and research into livestock, fisheries,
forestry, harvesting and natural resources is minimal
(IFrI-IIcA, 2008). The principal research activities in
biotechnology in the country are centred on molecular
characterization and plant propagation. They are
carried out by cEnTA and the EnA. There are no
modern biotechnology research facilities (Solleiro et
al., undated).


El Salvador does not have any regional/international
research centre such as those that exist in other
countries in the region. like the rest of central America,
the country does not have any private company that
does research in the agricultural sciences.


1.6. Support organizations
The PROinnova programme of FuSADES, founded
in 2007 to stimulate development, innovation
and exports of companies in the food sector, has
developed 24 innovation projects and is facilitating
the development of another 23. It is also supporting
the conversion of the FuSADES Integral Quality
laboratory into a Technological centre which can
provide technical assistance and services related to
product development, useful life, sensorial analysis,




79Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


labelling, etc. The programme provides integral
support from enterprise diagnostics and strategic
orientation of the business, to support on technological
matters, management, registration of patents and
trademarks, access to financing, laboratory analysis
services and product labelling. The programme
has financial resources (the budget for 2011 was
1.1 million dollars) and a team of eight staff and a
roster of 16 consultants.


The Foundation for Agricultural Technological Innova-
tion (FIAGRO), established in 2002, provides access
to technology and development of innovation proj-
ects in the country’s agricultural and agro-industrial
sector. FIAGrO’s principal programmes are centred
on knowledge management and innovation through
events and tools for dissemination, studies, guides
and technical manuals, and foreign travel for techno-
logical apprenticeship. FIAGrO has administered the
technical and financial execution of 27 innovative proj-
ects in the agricultural and agro-industrial sector of El
Salvador financed by SInAlIT.


FIAGrO has developed specific competencies in
two areas: biotechnology and renewable energy. It is
currently the technical assistance window (providing
advice on pre-feasibility and feasibility studies for
the implementation of projects) for a line of credit of
27 million dollars. FIAGrO also supports company
incubation activities and enterprise development.
The AGrOInnOvA programme, implemented
from 2004 to 2008 with an allocation of 358,500
dollars, identified innovative ideas, trained over 200
entrepreneurs in preparing business plans, evaluated
over 100 business plans and granted seed capital to
the most outstanding entrepreneurs. The total amount
of investments made by entrepreneurs exceeded ten
million dollars. There are currently 36 enterprises in
operation.


The PrOinnova and FIAGrO programmes and their
impact on the development of innovations are well
received by the private sector. Even large companies,
which do not benefit from their services, participate in
events organized by the two institutions.


The Millennium Fund (FOMILENIO) (see chapter
II) has a productive development component with
a budget of 87 million dollars over five years. Its
aim is to develop business opportunities, mainly
supporting poor farmers to produce and market high
value products. This component provides technical
assistance and commercial development services to


producers, promoting the development of suppliers
in different value chains. In the agricultural sphere,
the main two chains have been market gardening
and dairy. As of March 2011, the market gardening
programme, centred in the development of collection
centres and market intelligence, generated over 3,800
jobs. As of March 2011, the dairy programme had
generated over 700 jobs and increased by eight the
number of dairy producers’ associations working in
cooperation with two dairy cooperatives. For their part,
the latter are promoting the development of quality
measures, collection, transformation and marketing
of milk. The programme is faced with difficulties in
working with a great many small poorly organized
groups of producers. FOMlIEnIO does not carry out
research and development of new producers, nor
does it collaborate with knowledge generating centres
which support development and technology transfer
activities.


The National Development Fund (FUNDE), while
playing a minor role in the promotion of innovation
in the agro-industrial sector, has carried out studies
of policies and legislation which address topics of
relevance to the development of the agro-industrial
sectors, such as the impact on the sector of trade
agreements or intellectual property rights.


INSAFORP (see chapter II) finances student scholar-
ships to allow them to study in the EnA (50 schol-
arships) and the Zamorano university (currently 20
half-scholarships and 5 full scholarships). up to 2010,
InSAFOrP has awarded scholarships to 222 Salva-
dorian students. InSAFOrP has also financed various
training in the agricultural and agro-industrial sphere
(e.g., for a while, it financed training and attendance
at international events in the field of fish-farming).
InSAFOrP does not have an integral programme of
support for training in the agro-industrial field, and
does not have detailed information on its activities as
a whole in the sphere of agro-industrial innovation.


1.7. International cooperation
International cooperation makes an important contri-
bution to the country’s agro-industrial development. A
large number of support programmes for agricultural
and agro-industrial innovation have been developed
thanks to financing and/or technical support from in-
ternational cooperation and funds. Several of these
programs, although achieving positive results, have
not been continued once the funds ran out. There




80 Science, Technology and Innovation Policy Review - El Salvador


have also been varying results. For example, German
cooperation (GTZ) supported the Ministry of Agricul-
ture and livestock from 1998 to 2003 in the diagnostic
and improvement of the capacities of micro and small
agro-industrial enterprises selected by the Directorate
of Agro-business. The results were minimal due to the
limited business capacities (both in knowledge and
experience and resources). The management capac-
ity of four enterprises was improved, but this did not
have a significant impact on their subsequent devel-
opment. GTZ also supported the importing of two so-
lar dehydrators. however, they failed to standardize
process or quality, and the equipment could not be
used for commercial production of dried products.


canadian cooperation supported the development
of an agro-industry based on loroco, an edible
flower, native to El Salvador. With the support of the
Department of Food Technology of Dr. José Matías
Delgado university, progress was made in research into
post-harvest processes (packaging and preservation)
of the loroco flower. Despite having financial support
for the building of a processing plant, the project
was more or less abandoned due to the problems
of reaching agreement among loroco producers. It
is currently financing a research programme for the
revival of the production and marketing of indigo,
working in conjunction with the Balsam Association
and the university of Alberta, canada.


The Inter-American Institute for cooperation on
Agriculture (IIcA), an institution of the Inter-American
System, has supported various agro-industrial
programmes in the country, in particular, the national
fruit programme. It is currently supporting the
development of producers in the fruit chain in the
framework of the FOMIlEnIO programme.


2. Cohesion and foresight functions –
policy system


The country’s agricultural sector has suffered a major
decline during the last two decades. In general,
economic policies have lacked continuity and have
been marked by an anti-agricultural bias (ruTA,
2010, FuSADES, 2008). The reduction in public
spending was a disincentive to private investment
in the agricultural and agro-industrial sector, and
limited the capacity of important public institutions
such as cEnTA. In the last decade, direct transfer
programmes (inputs, equipment, machinery) took
on considerable importance, in 2009 accounting for


60 per cent of public expenditure (ruTA, 2010), and
displaced expenditure on research and technology
transfer. In addition, the greater importance of loans
and international cooperation encouraged the
dispersion of resources and weakened the capacity of
the Ministry of Agriculture and livestock to establish
priorities and bring cohesion.


From 2007, public spending on agriculture strength-
ened and since 2009 there has been a commitment to
reactive the agricultural sector, enshrined in the Minis-
try of Agriculture’s Strategic Sectoral Plan 2010-2014.
The programme contains ten action programmes,
one of them on technological innovation which in-
cludes the establishment of a national system of
agricultural technological innovation, a competi-
tive fund for agricultural innovation; and a national
network of local technological innovation centres.
Food security continues to attract the attention of the
current efforts of the Government of El Salvador with
respect to agriculture. This preoccupation has been
reflected in the continuation of the annual distribution
of farm packages (improved seeds and fertilizers) to
small farmers. The Family Agriculture Plan established
in 201116 comprises four components, of which the
most prominent is the programme of distribution of
farm packages. The plan also includes a programme
of support to productive chains between small pro-
ducers and trade, and another between trade and
industry, as well as a programme for agroindustrial
innovation17. For the implementation of the Family Ag-
riculture Plan, the MAG will receive 30 million dollars
in addition to its annual budget of 54 million dollars.
The amount of resources allocated to the agricultural
innovation programme is not known.


The country does not have a specific policy of support
for innovation in the agro-industrial sector. various
different policies directly or indirectly mention agro-
industry among their priorities. Figure 4 shows the
principal bodies involved in innovation policies in
the agro-industrial sector. The national Science,
Technology and Innovation Policy 2006-2030 (chapter
II) includes agro-industry among its 13 areas of
knowledge (fishing and agriculture). The Five-Year
Development Plan, while considering agricultural
development as strategic, does not specifically
mention agro-industry. The national research Agenda
prepared by MInED includes agro-industry as one of
the 29 strategic areas. The Integral Export Promotion
Strategy identifies the agro-food industry as one of
the five priority sectors. At regional level, El Salvador




81Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


has signed the central American Agricultural Policy
2008-2017, which includes a major component on
competitiveness and agro-business.


At sectoral level, the principal sectors, coffee and
sugar, have governing bodies. The Salvadorian Coffee
Council, created in 1989, is the governing body for
coffee-growing in El Salvador. It is an autonomous
state institution, but its executive includes private
sector participation. Its mission is to direct and
formulate national policy on coffee-growing.


There is no national programme for promotion of the
agro-industrial sector which establishes priorities
within the sector or a national agro-industrial research
programme.


As a conclusion, El Salvador does not have an
articulated and functional system of agricultural
and agro-industrial innovation. The policies are
fairly ambitious and available resources are scarce.
Priorities need to be set, both in general and within
the agro-industrial sector, together with a clear and
coherent allocation of resources. In particular, the
development of competitive agro-industries needs to
give priority to promotion of the companies’ capacity to
absorb technology, i.e. prioritizing public spending on
technology transfer and training, financial incentives


for innovation and the development of linkages
between all the actors in the system.


3. Management, control and regulation
functions – link between the policy
system and the executing system


There is broad consensus on the importance of agro-
industry for the country and there are a large number
of public sector institutions whose objectives and/
or functions include some kind of support for agro-
industrial development (Figure 5), although none of
these institutions, except cEnTA, state them explicitly.
The support provided to the agro-industrial sectors
has mainly focused, apart from on technology transfer
to the relevant productive sectors, on the development
of suppliers, markets and quality systems. In a more
limited way, there has been support for the development
of new agro-industrial enterprises. Support for r&D in
the agro-industrial sphere has been very limited.


coordination of agro-industrial programmes is limited.
levels of relations between different institutions
vary. Generally, there is more collaboration between
institutions that come under the same ministry.
however, the relationship between the EnA and
cEnTA, two institutions under the umbrella of the


Source: UNCTAD.


Figure 4. The principal bodies involved in innovation policies in the agro-industrial sector


Vice Ministry of Trade
and Industry


Vice Ministry of Economy


Vice Ministry of Science
and Technology CONACYT


Directorate of Quality and Productivity


Directorate of Productive Chains


Directorate of Productive Export
Development (FOEX)


Support Unit for the Integral Export
Promotion Strategy


Directorate of Innovation and
Technological Development


Economic and Social Council


CENDEPESCA


CENTA
MINISTRY OF AGRICULTURE


MINISTRY OF ECONOMY


MINISTRY OF EDUCATION


TECHNICAL SECRETARIAT
OF THE PRESIDENCY


Salvadorian Coffee Council




82 Science, Technology and Innovation Policy Review - El Salvador


Department Budget 2011(in dollars)


Ministry of
Agriculture and
Livestock


Directorate of agricultural economy and orientation
of agribusiness 16,758,935


National Centre of Agricultural and Forestry Technology 5,214,230 (for research and technology transfer)


National School of Agriculture 2,691,515


Ministry of
Economy


Directorate of Innovation and Technological Development 379,515


Directorate of Quality and Productivity 552,230


Programme of Support for the National Quality System 4,120,000


Directorate for Productive Export Promotion
(FOEX-FONDEPRO) 3,694,575


Directorate of Productive Chains and Export Development 216,530


CONAMYPE 1,825,000


Ministry of
Education Vice Ministry of Science and Technology 3,540,645


Source: UNCTAD based on official data.


Table 10. Budgets of the principal public institutions that participate in the promotion of agro-industry


MAG, is confined to specific aspects. The objectives
of support for innovation are noteworthy, but effective
relations between them are weak and there has been
a failure to create synergies.


In addition, there are also limitations in geographical
scope. various departments have specific potential,
characteristics, resources and needs which require
different kinds of intervention. Due to the scarcity of
resources, much of the support for agro-industrial
development is managed in San Salvador.


It should be highlighted that large companies and
some medium-sized companies, do not benefit
from the public programmes, among other things,
because the requirements of those programmes
exclude enterprises of a certain size, the amounts of
financing for the required investment are very limited
and/or the information and/or support services offered
to not meet the needs of these companies. The larger
innovative companies develop their own innovation
strategies and use their own funds to finance them.


The following highlights the principal bodies which
have innovation support programmes and projects of
relevance to agro-industry, and the principal outlines
of the regulatory framework of concern to agro-
industry. The information provided below is based
on interviews with staff of the various institutions and
information available on institutional websites.


Table 10 provides a summary of the budgets of the


principal public institutions for promotion of agro-
industry. The figures relate to the total budget of each
institution or department since there are no detailed
data on the budget allocated to innovation. Although
the figures are general, they reflect the limited level
of resources available and the relative weight of the
different institutions.


3.1. Ministry of Agriculture and
Livestock (MAG)


The MAG is logically the relevant public body for the
development of agro-industry which has the largest
budget (Table 10). however, as indicated in the
previous section, a large proportion of expenditure is
devoted to programmes of direct transfer of inputs and
not research and technology transfer (ruTA 2010).


SINALIT (chapter II) has promoted research in
the agricultural and agro-industrial sector. This
programme of competitive funds was co-financed by
an IADB loan of 2.2 million dollars and contributions
by entrepreneurs reached over 190,000 dollars in
cash and 2 million dollars in kind. This programme,
implemented with the help of FIAGrO, was probably
the most structured effort with the greatest resources
undertaken in the country to drive innovation in primary
production and agro-industry. Its results were limited
by the excessive administrative requirements and
demands of the programme.




83Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


El MAG also implemented the National Fruit
Programme (FRUTAL-ES) with the help of the Inter-
American Institute for Agricultural cooperation (IIcA).
The programme, established in 2000, invested over
six million dollars. This integral research and technical
assistance programme promoted the development of
technical capacities for fruit growing and processing
and the development of markets in which to sell it.
The chief technological components included the use
of improved genetic material and the development
of value through fruit processing. The most notable
results include: technical assistance for over 3000
small and medium-scale farmers, substitution of
some fruit imports, access to international markets,
development of training programmes and material
at technical and higher level, and the development
of producers’ associations and nurseries (riveros
et al., 2008). The new meso-American fruit-farming
project will continue this work. It should be noted
that the main beneficiaries of this programme were
small farmers. In addition, like other programmes,
the agro-industrial development component had a
lower priority than in the development of production
or markets. The programme did not include an agro-
industrial research component.


In the vegetable sphere, another notable effort was
a project sponsored by uSAID, the united States
cooperation agency implemented from 2002 to
2009. This project, implemented by the company
Fintrac, provided technical assistance and irrigation
and nursery inputs to market gardeners, but did not
include an agro-industrial component.


The Directorate of Agricultural Economy and Orientation
of Agribusiness in the MAG generates and publishes
agricultural statistics.


3.2. Ministry of Economy (MINEC)
The Ministry of Economy (MInEc), and in particular
the vice Ministry of Industry and Trade, support agro-
industrial development through various departments.
The principal activities and results of the last two years
are described below.


The Directorate of Innovation and Technological
Development provides support to enterprises in the
food and drinks and agro-industrial sectors through
the InvEnTA platform, among others, stimulating the
key actors in the agro-food area, training SMEs in
the sector (12), organizing the dissemination of best
innovative practice, and supporting enterprises in the


Source: UNCTAD.


Figure 5. The principal government bodies involved in the management, control and regulation systems


Vice Ministry of Trade
and Industry


Vice Ministry of Science
and Technology CONACYT


Directorate of Quality and Productivity


Directorate of Productive Chains


Directorate of Productive Export
Development (FOEX)


Directorate of Innovation and
Technological Development


CONAMYPE


CENDEPESCA


CENTA
MINISTRY OF AGRICULTURE


MINISTRY OF ECONOMY


MINISTRY OF EDUCATION


PRESIDENCY


Autonomous bodies


EXPORTA


PROESA


CONADEI




84 Science, Technology and Innovation Policy Review - El Salvador


sector in the process of obtaining co-financing from the
Productive Development Fund (FOEX-FOnDEPrO).
The principal obstacles faced by this department are
the lack of institutional strength to design, evaluate and
monitor the unit’s various interventions in this sector
as well as a lack of resources to allow it to expand its
framework of operation and geographical scope.


The Directorate of Quality and Productivity has sup-
ported improvements in the quality and productivity
of two pilot agro-industrial MSMEs and has certified
a specialist consultant. It has also promoted improve-
ments in quality, productivity, and food safety of agro-
industrial MSMEs. The principal obstacles faced by
this department are the lack of human resources to
provide wide geographical support, the lack of inter-
institutional coordination for the elaboration, verifica-
tion and surveillance of technical standards and regu-
lations on agro-industrial products, the lack of con-
sistency in learning processes and implementation of
quality tools and systems, as well as shortcomings in
the technical competencies of the staff of the bodies
responsible for inspection and verification of compli-
ance with technical standards and regulations.


The Programme of Support for the National Quality Sys-
tem is intended to promote the new legal framework
of the national Quality System (standardization, tech-
nical regulations, accreditation and metrology), and
to ensure the approval, implementation and interna-
tional recognition of the System. The programme has
strengthened the proposal for a general framework for
conclusion of agreements on mutual recognition of
technical regulations and procedures for evaluation of
conformity, of especially importance for agro-industri-
al products. The programme has also made technical
contributions to the Quality Bill and has raised legis-
lators’ awareness concerning the content of the Bill.
The main obstacle to the development of the national
quality system is the failure by the national Assem-
bly to approve the Act on the Salvadorian System for
Quality and Productivity.


Other institutions of the Ministry of Economy (e.g., the
Directorate of Productive Export Development, the
Directorate of Productivity chains and cOnAMYPE)
also promote productive development in general.


3.3. Ministry of Education (MINED)
The vice Ministry of Science and Technology has little
part to play in agro-industrial development. Although
agro-industry is one of the 29 areas identified in the


national research Agenda, there are no known activi-
ties that have taken place or are planned in this area.
Moreover, the new national centre for Scientific re-
search of El Salvador (cIcES) does not include agricul-
tural or agro-industrial research among its priorities.


3.4. Legal framework
A legal framework, including an intellectual prop-
erty regime, trade law, labour and contract law, and
regulations on food safety, standards and biosecurity
which provides certainty, promotes competitiveness
and safeguards the fundamental interests of various
groups of producers and consumers is a factor which
facilitates innovation and agro-industrial develop-
ment.


The comments received on regulation indicate as
the main concern the limited implementation in some
sectors of basic hygiene standards and, in general,
little adoption of certification of good agricultural and
manufacturing practices, as well as difficulties in
assuring adequate tracing of products. Entrepreneurs
and experts also identified the existence of economic
and trade policies which, although meeting the need
of food security or the demands of specific groups of
producers, make inputs for agro-industrial enterprises
more expensive.


With regard to intellectual property, El Salvador is
a member of WTO, WIPO and a part to the Patent
cooperation Treaty. concerning biotechnology, El
Salvador has ratified the convention on Biological
Diversity (cBD)(legislative Decree no. 833, 1994) and
the cartagena Protocol on Biosafety to the convention
on Biological Diversity (legislative Decree no. 85,
2003). Since 2008, the planting of genetically modified
organisms has been permitted in the country (see
Special regulations for the Safe use of Genetically
Modified Organisms, Decree no. 78). El Salvador still
does not have legislation on the protection of plant-
breeders’ rights but the Free Trade Agreement with the
united States requires El Salvador to ratify or acced to
the International convention for the Protection of new
varieties of Plants (1991)(uPOv convention 1991).
FunDE has presented an alternative proposal18.


To sum up, the priorities with regard to the legal
framework relate to the application of regulations on
food safety and the adoption of quality standards, as
well as coordination of policies and legislation of various
kinds which, indirectly, affect the competitiveness of
the agro-industrial sector.




85Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


c. concluSIonS And
REcommEndATIonS


In the agro-industry of El Salvador, a wide diversification
of the supply can be seen as well as a renewed public
and private interest in developing the sector. There are
successful cases of innovative companies which have
managed to consolidate, diversify and export their
agro-industrial products. There are also numerous
opportunities to develop Salvadorian agro-industry,
such as, for example:
- the development of ethnic foods and their expansion


to other markets,
- the expansion of special coffees,
- the development of fish-farming,
- the transformation of traditional raw materials, such


as Peruvian balsam,
- the utilization of raw materials which are abundant


in El Salvador, such as honey, in the manufacture of


other products in the country,
- the processing and manufacture of products based


on fruit and vegetables,
- the adoption of quality processes in artisanal activi-


ties, or
- the transformation of the artisanal manufacture of


panela into industrial.


The development of each of these opportunities, as
well as others, requires a combination of actions at
various levels: governance, financial resources, re-
search, technology transfer, access to specialized
services and infrastructure, etc. The bottlenecks (Ta-
ble 11) facing expansion of an innovative Salvadorian
industry are chiefly:
- the limited national human resources, at profes-


sional and technical level, trained in agro-industrial
technology and innovation,


- the meagre levels of investment in research in public
research centres and higher education institutions,


Table 11. Principal strengths and weakness, opportunities and threats to innovation in the agro-industrial sector


STRENGTHS WEAKNESSES


• There are private sector institutions well-equipped to support
agro-industrial innovation.


• FOEX-FONDEPRO provides financial support (part non-
reimbursable) for innovation projects.


• Innovative activity of a nucleus of companies, mainly large
enterprises.


• Lack of an agro-industrial programme to guide efforts.
• Confused national STI policies which meet other objectives


(legitimate but not STI).
• Discontinuity of public programmes to support agricultural and


agro-industrial innovation.
• Little public priority to investment in R&D and innovation, and


weakening of CENTA.
• Limited national human resources, at professional and technical


level, trained in agro-industrial technology.
• Lack of articulation of institutions related to agro-industrial


development, chiefly between companies and higher education
and research institutions.


• Lack of interest and confidence between Salvadorian companies
to group together and develop on a joint basis.


• Scant access to financial resources for agro-industrial
innovation.


• Limited adoption and capacity to implement quality regulations
and standards.


OPPORTUNITIES THREATS


• The niche market of Salvadorians resident in the United States.
• Large number of institutions, chiefly in the public sector,


which have defined specializations and capacities to support
companies which seek to innovate.


• Broad recognition of the key role of agro-industrial development.
• El Salvador’s biodiversity offers important inputs for natural


cosmetics, natural medicines and effective food supplements.
• Project for the establishment of a national development bank.
• Programmes to support the development of suppliers.


• International and regional competition.
• Policies (of El Salvador and other countries) which affect the


supply of certain important inputs.
• Policies which prioritize expenditure in agricultural inputs


instead of investment in infrastructure, innovation and
development of markets.


• Weaknesses of Salvadorian agriculture (system of tenure
and land market, land constraints, lack of associative activity,
irrigation infrastructure, greenhouses, collection centres).


• Risk aversion and limited interest in investment in innovation.
• Appropriation of Salvadorian biodiversity by foreign companies.


Source: UNCTAD.




86 Science, Technology and Innovation Policy Review - El Salvador


- the lack of collaboration between companies and/or
research and/or educational institutions,


- an inadequate supply of technological and scientific
services, including a limited supply of scientific and
technological consultancy services, as well as a
shortage of technicians who, for example, can repair
and maintain machinery,


- an inadequate quality infrastructure to support inno-
vation,


- weaknesses in entrepreneurial collaboration under
some headings between producers and processors
or between companies in the same industry, and
generally between companies in different industries,


- limitations in the agricultural sector which affect
agro-industrial development, including, among other
things, scarce agricultural investment and structural
limitations.


Recommendations
The development of a national agro-industry centred
on the generation of high value niche products
requires technological, scientific and innovation
capacities. For the continuous development of such
capacities, it is essential to have an integrated system
of innovation capable of articulating an agro-industrial
strategy around a common vision, identifying needs,
and establishing priorities and commitments.


Bearing in mind the links between agro-industry and
the agricultural sector, an agro-industrial system can-
not be conceived separately from the agricultural
system. For this reason, we will speak of a system of
agricultural and agro-industrial innovation. This does
not mean that the specific concerns of agro-industrial
development must be watered down, and for that rea-
son, it is proposed to create a working group on the
promotion of agro-industrial development, compris-
ing representatives of the Ministries of Agriculture and
livestock, Economy and Education, as well as of the
private sector, higher education institutes and support
organizations, including international cooperation.
This working group would promote the establishment
of a national programme for agro-industrial innovation
to orientate the development of the sector in the long
term, identifying goals, actions, budgets and respon-
sibilities. It will be necessary to carry out a prospec-
tive study to identify two or three subsectors with the
greatest economic and social potential in the medium
term, in order to focus public efforts on these areas.


Innovative activity is mainly carried out by the private
sector, and its capacity to work in association and its


interest in innovating is essential. It is equally crucial for
the private sector to participate in research activities
and the design, implementation and financing of
innovation programmes.


For its part, public commitment to agro-industrial
development must be reflected in the priority attached
to expenditure, in this order, on technology transfer
activities, development of infrastructure to support
innovation, and agro-industrial research. A greater
proportion of the agrarian budget could be allocated
to these activities instead of financing of transfer of
inputs.


Public efforts must be directed towards those com-
panies which have the capacity to generate the most
impact. This requires adapting support instruments so
as to incentivize additional investment in innovation by
small, medium-sized and large enterprises. This re-
quires the use of a varied set of instruments, including
some new ones, such as, for example, tax incentives
and/or provision of technological intelligence services,
and revision of existing ones so that, for example, they
encourage greater levels of investment in innovation by
larger companies. The design of effective instruments
requires having a good information system which,
among other things, indicates the principal factors
which hold back innovation, a precise idea of the spe-
cific objective that it is sought to achieve, and an evalu-
ation of the impact of the instruments already in use.


Based on these considerations and the analysis, it is
recommended to:


1) Develop a national programme for the development of
agro-industry, in the framework of a national system
of agricultural and agro-industrial innovation


- Establish a working group on the promotion of agro-
industrial development, comprising representatives
of the Ministries of Agriculture and livestock,
Economy and Education, as well as of the private
sector, higher education institutes and support
organizations.


- Identify, in collaboration with the private and academic
sector and based on criteria of economic and social
impact, two or three priority agro-industrial sectors.


- Establish a national programme for the development
of agro-industry which identifies a set of priority
actions in terms of education, research, innovation
and infrastructure. This programme must focus on
the identified agro-industrial sectors, establish the
respective responsibilities of both public and private
actors, and allocate the necessary resources.


- In general, and in collaboration with the different




87Chapter IV: InnOvATIOn In ThE AGrO-InDuSTrIAl SEcTOr


actors, develop the draft Sectoral Strategic Plan 2010-
2014 (MAG) for the configuration of a national system
of agricultural and agro-industrial innovation.


2) Strengthen the quality of education and training in the
agricultural and agro-industrial sector, in particular, the
priority sectors or industries.


- review education and training needs (students,
teachers, extension workers and companies) in agri-
cultural and agro-industrial studies and promote the
updating of educational provision in these areas.


- Establish a programme of scholarships for students
and teacher training, for postgraduate training in El
Salvador and abroad.


- Establish a fund to implement specialist courses on
agro-industrial subjects. The funds must facilitate
the participation of international experts.


- Strengthen the capacities of the EnA, in general and
in the agro-industrial sphere, in particular, providing
it with more resources for investment in research
facilities, research and technology transfer activities
and recruitment of teachers.


3) Support agricultural and agro-industrial research in
universities, research centres and companies.


- Increase public financing of agricultural and agro-
industrial research.


- Increase the funds available through FOEX-FOnD-
EPrO for innovation, so that they can be used by a
greater number of agro-industrial enterprises.


- Establish one or two research fellowships (at post-
graduate level) in one or two agro-industries iden-
tified as having the most potential and in which at
least one higher education institution and one com-
pany in the sector collaborate.


- Promote the participation of agro-industrial compa-
nies in research activities through their participation
in the design of the national programme for agro-in-
dustry and encourage participation in the proposed
research fellowships.


- In general, strengthen agricultural innovation and
research by promoting the participation of produc-
ers in research activities, revising cEnTA’s role in
research and the resources allocated to it, and al-
locating more resources to technology transfer and
research activities.


4) Establish a package of measures to promote agro-
industrial innovation.


- Establish two or three local technological training and
innovation centres, focused on the selected agro-
industries. These centres must facilitate technology


transfer and research to solve specific production
problems. Private sector involvement in these cen-
tres will be vital.


- Establish incentives to encourage innovation that
meet the needs of large innovative companies, in-
cluding the development of venture capital, guaran-
tee funds, and tax incentives for investment in inno-
vation activities.


- Support the development of advanced technological
services, identifying needs for such services, estab-
lishing incentives for the establishment of provid-
ers of those services and encouraging cooperation
agreements with foreign technological centres which
can provide them.


- continue supporting entrepreneurial activity and es-
tablish a set of actions to promote a culture of inno-
vation in the agro-industrial sector.


- Promote the development of agro-industrial infra-
structure (processing and packaging plants, cold
chain, storage centres) identifying priorities for infra-
structure, increasing public funds for investment in
priority areas and providing financial incentives for
private investment in infrastructure (e.g. financing
feasibility studies for the establishment of factories
and establishing financial facilities for private invest-
ment).


- Increase capacity to adopt good agricultural and
manufacturing practice and to comply with sanitary
and phytosanitary standards, allocating more
resources to training of farmers and producers and
development of institutional capacities in this area.


- continue preparing market studies for agro-industrial
products and carry out more specialized studies in
the priority agro-industries.


- Facilitate the development of capacities in biosafety
and biotechnology.


5) Strengthen monitoring and evaluation of capacities,
policies and programmes.


consistent with the recommendations of a general
character for any system of innovation, it is recom-
mended:


- Through a prospective study, identify the niches with
the greatest added value and potential, and those
on which public efforts should be focused.


- Monitor, evaluate and publish in a systematic manner
the impact of policies and programmes to support
the sector, and the impact of different economic,
agricultural, health and environmental policies on
agro-industry.




88 Science, Technology and Innovation Policy Review - El Salvador


noTES
1 See, for example, the exhaustive study by Arritt (2006) in the quality system in the agro-industrial sector. Many of the


problems described were also mentioned during the interviews conducted.
2 See, for example, Falck-Zepeda et al. (2009) or Solleiro et al. (undated).
3 The analysis in this section is based on information provided by the Sugar Association of El Salvador and the exchange of


information with experts of that association.
4 According to calculations by FAO (see http://faostat.fao.org/), yields from sugar cane (in metric tonnes) per harvested


hectare were 78.5 (2008) and 91.9 (2009) in El Salvador, while the average yield worldwide was 71.4 and 69.6 respectively.
5 Data provided by the Sugar Association of El Salvador.
6 A local candy.
7 According to united nations cOMTrADE database.
8 See study of the fisheries sector in latin-American countries: El Salvador.
9 nixtamalized maize is maize cooked in water with lime. nixtamalization facilitates, among other things, the making of tortillas


and control of microbe activity.
10 Information based on BMI (2006) and information provided by managers of dairy processing plants.
11 See www.aves.com.sv.
12 Information on personal communication with Mr Javier Francés.
13 Information based on data of the Superintendency of the Financial System (www.ssf.gov.sv).
14 See FAO country profile at www.fao.org/fishery/countrysector/FI-cP_Sv/es.
15 Decree 43 (June 2009).
16 See Government of El Salvador (2011).
17 The programme is centred on the following areas: added value and market intelligence, new technologies, agricultural


computerization, bioenergy, strategic alliances with international research and innovation organizations and inter-institutional
coordination between the Agricultural Promotion Bank and cEnTA’s agricultural extension service.


18 See the proposed Act on access to genetic resources and participation in the profits: a bill agreed for El Salvador prepared
by FunDE (Aguiñada Arévalo, 2009).




Information and communication
technologies




90 Science, Technology and Innovation Policy Review - El Salvador


Information and communication technologies (ICT)
have become a crucial tool for business performance
by allowing better communications, advanced
information processing and interaction at a distance
between entrepreneurs, suppliers, consumers, public
agencies, etc. In other words, ICT allow productive
improvements in the performance of enterprises. Thus,
the value of a national ICT sector lies not only in its
contribution to the public sector but, more importantly,
in the value that it can add to other productive activities
carried on in the country.


At the request of the Government of El Salvador, what
follows is an examination of the ICT innovation system,
with the aim of making recommendations designed to
strengthen innovation in this sector. The ICT sector is
defined as those industries whose products (goods
and services) are intended to fulfil or enable the
function of information processing and communication
by electronic means, including transmission and
display. This sector includes the ICT manufacturing
industries, ICT services industries (ICT publications,
telecommunications, information technology and
computer services, websites and data processing,
and repair of computers and communications
equipment) and commercial ICT industries (wholesale
of computers and electronic equipment)1.


A. ThE globAl conTExT of
ThE IcT SEcToR


ICT have increasingly penetrated all spheres of
society. Despite contracting by 3 per cent in 2009 as
a consequence of the economic recession, the ICT
sector returned to global growth and it is estimated
that in 2010, the global market totalled 3.7 billion
dollars (WITSA, 2011). In other words, expenditure on
ICT was the equivalent of 6.2 per cent on global GDP.
The ICT market is dominated by the communications
subsector (58 per cent), followed by the computer
services subsector (20 per cent). The hardware and
software subsectors account for 13 per cent and 9 per
cent of the sector respectively (WITSA 2011).


Software services and computer services are the
segments of the ICT sector which have shown the most
growth in the last few years and which offer the best
entry opportunities for developing countries. Although
software production is concentrated in developed
countries, there are some developing countries which
have achieved significant penetration in international


markets. India has been one of the most successful
cases in terms of quantity. It is estimated that income
from the software and computer services sector in
India reached 63,700 million dollars in 2010 (of which
77 per cent is exports mainly to the United States and
the United Kingdom) rising from 1.2 per cent of GDP
in 1998 to an estimated 6.1 per cent in 2010. This
industry generates some two million direct jobs in the
country2.


The expansion of ICT has also been reflected in the
significant increase in the percentage of the workforce
which can be characterized as information workers,
i.e. workers whose primary occupation is information
processing3 in various countries in recent decades
(Table 1). Participation has increased dramatically
in all the countries of Latin America, but is still far
behind that of the developed countries (the average
for Europe and North America is 50 per cent) and the
Asian countries (average 31 per cent) (Katz, 2009).
In El Salvador, there has been considerable progress
and, by 2006, it was estimated that a quarter of the
workforce were information workers.


In turn, in recent years, and in close association
with the spread of ICT, there has been an expansion
of a series of activities which are known generically
as “information technology (IT) enabled services”,
which provide a variety of services at a distance
which previously required geographical proximity
(accountancy, human resources management,
procurement management, computer maintenance,
etc.). The number of transnational companies which
establish or contract offshore centres to provide these
services increases day by day, basically to try and
reduce costs but also to access human resources and
diversify the geographical base of their operations.
Just as in software and computer services, some
developing countries, especially China and India,
have positioned themselves as attractive locations for
the provision of these services.


These activities form part of the “new knowledge
economy” and share common characteristics: i) all
have export growth rates higher than sectors of the
“old economy”, ii) they tend to pay higher wages
and generate more employment, with high skill
levels, than the economy on average; iii) by basing
their development on the capacity for innovation and
training, they generate “side-effects” which benefit
the rest of the economy; iv) productivity increases
rapidly and there are opportunities for “late” entry (as
shown by the experience of some of the countries




91Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


1960s decade 2000s decade


Percentage Year Percentage Year


Argentina 21 1960 29 2006


Brazil 12 1960 26 2004


Chile 15 1960 31 2005


Colombia 14 1975 27 2000


Ecuador 7 1962 25 2006


El Salvador 6 1961 26 2006


Guatemala 6 1964 ... ...


Mexico 11 1960 25 2006


Panama 14 1960 28 2006


Peru 9 1961 23 2001


Uruguay 21 1963 33 2006


Venezuela (Bolivarian Republic of) 14 1961 21 2002


Average 12 ... 27 ...
(1) Katz considers as information workers all those who work in sectors 1, 2 and 3 of the ILO International Standard Classification


of Occupations (ISCO which includes professionals, technicians; legislators, senior officials and managers; and office clerks.
Source: Katz (2009.


Table 1. Percentage of the workforce considered as information workers(1) in Latin America


mentioned above) as they are sectors which have not
yet reached maturity from a technological point of view
(ECLAC, 2008). from the perspective of developing
countries, they are activities which can contribute to a
development and international insertion strategy which
is not exclusively based on the relative abundance of
natural resources or low cost labour.


Three types of IT-enabled services can be distin-
guished:


- front office services (call centres and customer
service centres),


- back office services (data capture, human resourc-
es, payroll, finance and accounting, purchasing,
transcription), and


- outsourcing of knowledge-intensive activities (finan-
cial analysis, data mining, engineering, research and
development, insurance processing, architectural
design, distance learning and publishing services,
medical diagnoses, journalism).4


The skills required by the different types of service
vary from basic training (data capture and some call
centres), sometimes supplemented by knowledge
of English, to high levels of knowledge (design,
medical diagnosis, financial analysis, r&D). Likewise,


international markets for outsourcing of these
services are at different stages of maturity. The most
established market is international outsourcing of
computer services. Customer services, finance,
infrastructure management, human resources and
knowledge services are expanding. however legal
and procurement services are still at an embryonic
stage (UNCTAD 2009).


b. DIAgnoSTIc of ThE
SySTEm of InnovATIon
In ThE IcT SEcToR


1. Production and execution function –
executing system


1.1. Infrastructure
The telecommunication sector has attracted 917
million dollars for foreign investment into El Salvador
in the last two decades. The liberalization of the
telecommunications market and the privatization
of the system in 1998 were an important factor in
attracting foreign investment and the development of
the sector.




92 Science, Technology and Innovation Policy Review - El Salvador


Country Fixed telephony Mobile telephone subscriptions Internet users
Broadband Internet


subscriptions


Brazil 21.42 89.79 39.20 7.51


Chile 21.07 96.94 33.98 9.81


Costa Rica 32.60 42.59 34.48 6.01


El Salvador 17.83 122.77 14.42 2.42


Guatemala 10.08 123.39 16.25 0.78


Hondurasa 11.12 103.32 9.80 0.00


Mexico 17.72 76.20 25.95 9.05


Nicaragua 4.44 55.80 3.48 0.82


Panama 15.55 164.37 27.79 5.82
a Broadband Internet subscription data (fixed) is for 2008.
Source: UNCTAD (2010b).


Table 2. ICT penetration, selected Latin American countries, 2009 (per 100 inhabitants)


The number of fixed telephone lines has tripled in a
decade, rising to 1.1 million lines in 2010 (SIGET). The
high growth levels seen following the liberalization
of the sector have eased off and currently growth
levels are fluctuating between zero and seven per
cent annually5. The fixed telephony market still has
a dominant operator (CTE) with 90 per cent of the
market (UNCTAD 2010c).


The mobile telephone market, on the other hand,
is more dynamic and competitive. The three main
operators (Tigo, Claro and Telefónica móvil) share
some 30 per cent of the market. The development
of mobile telephones has been dramatic. There are
currently 122 subscriptions per 100 inhabitants, 90
per cent of which are prepaid. The high number of
subscriptions can be explained in part because
consumers often use two or more mobile telephone
services to take advantage, among other things, from
differences in the costs of calls of different operators
and coverage. In addition, the country has 11 carriers
which provide international telephone services and
have allowed the expansion of international calls at
cheaper rates6.


Internet services, especially broadband, have also
grown rapidly. At the end of 2009, Internet subscrip-
tions had been almost entirely replaced by broadband
subscriptions, reaching a total of 146,062 subscrip-
tions (SIGET, 2010). foreign investment led the ex-
pansion of the country’s fibre optic network, which
almost tripled in only six years, from 2,564 Km in 2003
to 7,163 Km in 2008 (UNCTAD, 2010c). Telefónica was


the first company to offer broadband Internet services
and currently has a leading position with 90 per cent
of the market (UNCTAD, 2010c). In terms of broad-
band penetration, El Salvador is further ahead than
other countries in the region, but still somewhat be-
hind Costa rica, Panama and other leading countries
in the Latin American region (Table 2).


In terms of affordability, installation costs of telephone
lines have fallen from 331 dollars in 1998 to 40 dollars
in 20107. on the other hand, the monthly subscription
and local calls (residential and commercial) for fixed
telephones have increased (UNCTAD 2010c).


There are opportunities to improve the affordability
of ICT, especially fixed telephones. A comparison
of prices 8 at regional level, taking into account
purchasing power parity and the level of gross national
income (Table 3) shows that the basket of ICT prices
is perceptibly lower in Costa rica and Panama, and
also in Guatemala in the case of fixed telephones.
The debate on the costs of ICT, in particular, basic
line charges for fixed telephones, led the Legislative
Assembly of El Salvador to decree, in April 2010, a
strengthening of the functions of SIGET to determine
and revise the maximum amount of basic telephone
charges and reduce the cost of access to fixed
telephones to 6.14 dollars per month (excluding VAT)
(official Journal of El Salvador, 2010).


Infrastructure for innovation in ICT


In addition to general ICT infrastructure, which covers
access, use and impact of ICT for companies and




93Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


Country Basket of ICT prices
Sub-basket of fixed telephony


as % of GNI per capita


Sub-basket of mobile
telephony as % of GNI


per capita


Sub-basket of fixed
broadband as % of GNI


per capita


Costa Rica 0.84 0.80 0.46 1.24


Panama 2.18 2.34 0.96 3.23


El Salvador 4.47 3.96 2.44 7.01


Guatemala 7.39 3.48 3.27 15.42


Nicaragua 19.68 5.26 15.54 38.25


GNI: Gross National Income.
The ICT basket of prices is a compound index calculated as the simple mean of the fixed telephony, mobile telephony and
broadband sub-baskets.
Source: ITU 2010.


Table 3. Affordability of telecommunications, basket of prices, Central America, 2009


individuals and, thus, the potential for expansion of
the ICT sector, it is important to examine whether there
is an adequate infrastructure for innovation in the ICT
sector. In this case, we mean the existence of an
infrastructure which allows for research, development
and innovation in ICT, such as, for example, software
testing laboratories, technology parks or incubators
of technology-based companies, or an infrastructure
which facilitates ICT research.


El Salvador lacks supportive infrastructure for innova-
tion in ICT. There are some university ICT laboratories9,
but these are used primarily for educational activities
and do not provide services to the ICT industry. There
are no software quality control laboratories. Neither
does El Salvador have a consolidated support infra-
structure for incubation of technology-based compa-
nies. There is no developed provision of seed capital
funds, there are no technology parks nor consolidated
efforts for the incubation of technology-based compa-
nies. Germina is a recent proposal for the incubation
of technology-based companies promoted by fran-
cisco Gavidia University, but it still too early to see any
results.


In the framework of infrastructure to support research,
it should be noted that seven higher education
institutions in El Salvador are connected to the
Salvadorian Advanced Network of research, Science
and Education (rAICES)10. This network provides
dedicated Internet connections for the academic
community and connects with others in the Latin
American region and in Europe. The network allows
the conduct of research which requires access to, or
processing of, a large volume of information, as can


occur with research projects which have a large ICT
development component. however, there is no more
detailed information on its use and impact.


1.2. Access to and use of ICT
El Salvador has high rates of access to mobile
telephony but limited access to fixed lines (17.8)
and Internet (14.4), especially broadband (2.4 in
subscriptions)(see Table 2).


Salvadorians mainly access the Internet through
paying access points (mainly cybercafés) (most
frequent place of use for 44 per cent of users) and at
home (35 per cent) (Table 5).


At departmental level, there is an important digital
divide in terms of household Internet and fixed
telephony access (see Table 4) and major efforts are
needed to achieve greater fixed telephone and Internet
coverage for the country as a whole. for example, in
the majority of departments, less than 3 per cent of
households have Internet access, while in La Libertad
and San Salvador, over 11 per cent of households
have Internet access.


on the other hand, mobile telephone penetration is
high throughout the country and the variation between
departments much less (with a minimum penetration
of 74.3). Given the mobile telephone coverage, the
development of government electronic services on a
mobile platform could be of particular interest.


Internet use is mainly aimed at educational activities
and communications (Table 5). The available data do
not tell us what percentage of users use the Internet
to interact with the public administration, to carry out




94 Science, Technology and Innovation Policy Review - El Salvador


Households with Internet access
Households with fixed


telephone access
Households with mobile


telephone access


Total Country 6.4 34.2 80.6


Total Urban 9.5 45.6 83.6


Total Rural 0.5 11.8 74.8


Ahuachapan 1.5 17.3 75.0


Cuscatlán 1.7 21.6 76.4


Sonsonate 2.3 21.8 75.3


La Paz 1.1 22.5 74.3


Morazán 2.2 23.0 74.6


Cabañas 1.6 23.4 77.1


Usulután 2.0 24.2 76.8


La Unión 2.1 24.7 78.7


San Vicente 2.6 26.7 75.0


Santa Ana 5.2 29.2 83.5


Chalatenango 3.3 32.2 78.0


San Miguel 6.4 33.5 78.9


La Libertad 11.6 37.2 83.5


San Salvador 11.1 50.4 85.5


Source: UNCTAD, based on DIGESTYC (2010).


Table 4. Households with Internet, fixed telephone and mobile telephone access in El Salvador, as percentage, 2009


banking transactions or to buy goods and services. As
recommended by ECLAC11, it would be interesting if
the multi-Purpose household Survey reported Internet
use in multiple places and multiple activities by each
individual surveyed, rather than being restricted to the
most frequent place of use and activity.


It is also important to have information on access to
and use of ICT by enterprises, especially small and
medium-sized enterprises. Like many countries, there
has been no official survey in El Salvador of access
to and use of ICT in enterprises. The Partnership for
measurement of ICT for Development12 can advise
on and support the collection of information in this
sphere.


The only information available on the use of ICT
by mSmEs in El Salvador is the survey of over 150
Salvadorian enterprises carried out in 2004 as part of
a study of five Central American countries (monge-
González et al., 2005). Seven years have passed
since the survey was carried out, during which time
great changes have taken place (e.g. the expansion
of mobile telephony, the growth in the ICT-based
services sector and the development of Web 2.0
(from on-line software services to social networks or
social media)13, but its analysis can provide some


relevant indications: larger companies had greater
levels of access to ICT and the use of ICT by mSmEs
was not very sophisticated. for example, less than
a third of Salvadorian mSmEs used computers to
carry out administrative functions (accounting, stock
management, sales analysis, etc.) and only 5 per
cent used ICT for productive processes. The Internet
was mainly used as a source of information and as
a means of communication. only 8 per cent of the
mSmEs interviewed used the Internet to participate
in public tendering and 17 per cent of SmEs used
electronic banking. moreover, the development of
electronic commerce was incipient: less than 5 per
cent of mSmEs placed orders or paid their suppliers
via the Internet or email.


The conduct of another survey of access to, use and
impact of ICT in the business sector would provide
further insights regarding the development of its
access and use. The survey carried out in 2004
provided very interesting information on a wide range
of relevant areas. This could be taken as a reference
point but should be updated in order to identify the
use and impact of the new ICT tools by companies,
obtain more details of the main barriers and incentives
for the adoption of different ICT tools and the impact




95Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


Place of use Most frequent type of activity


At home 34.9 Buying or ordering goods and services 0.3


At work 9.7 Communication 17.8


In educational establishment 9.4 Electronic banking 0.6


Places with paying access (cybercafé, infocentres) 44.0 Formal education and training activities 67.3


Interaction with government organization or public
authorities 0.3


Other 13.8


Source: UNCTAD, based on the Multi-Purpose Household Survey, 2009 (DIGESTYC, 2010).


Table 5. Internet users by place of use and type of activity (percentage of total users aged over 10 years), 2009


of public policies and programmes on the adoption of
these tools.


1.3. Enterprises
At present, there are no reliable data on the ICT
industry in El Salvador. The last economic census,
carried out in 2005 (DIGESTYC 2005), indicates that
the share of this sector in GDP was around 7 per cent,
and that 95 per cent of that contribution came from
the telecommunications sector.


In that year, there were 1,077 enterprises in the ICT
sector14, chiefly in the area of telecommunications
services (829 enterprises) and computer services (221
enterprises). In that year, over 8,200 persons were
employed in the sector. Total sales reached 923 million
dollars, of which 95 per cent were telecommunications
services. Computer service accounted for 38 million
dollars. It should be borne in mind that various major
industries in the ICT sector (e.g. sales of computers
or data processing services) did not report in the
economic census in 2005.


During the conversations which took place, industry
representatives, entrepreneurs and the relevant
academic institutions indicated that the ICT sector
in El Salvador is composed of 5 large hardware and
software companies, each with a turnover of between
10 and 25 million dollars, and another group consisting
of 75-100 companies. A high percentage of software
companies are software licensing companies and
less than one third sell services.


The opinions gathered indicated that there is no sig-
nificant research and development among compa-
nies in the sector, and that there is a predominance
of generic software and, therefore, less added value.


Among the most widespread services are adaptation
of enterprise resource planning software (ErP) and
software programming for other companies, generally
in the most common languages (e.g. Java). Demand
for software in the country is led by the banking sector,
but this sector tends to buy abroad.


Software developers find it hard to survive, and
those companies that do manage to grow do so
thanks to a regional strategy. According to a study
carried out by Exporta15, a high percentage of the
44 companies interviewed had had experience
of exporting their services, mainly in the Central
American area, the United States and the Caribbean.
however, international trade data show limited reach
of Salvadorian ICT exports, and a level of imports
somewhat lower than other countries in the region
(see figure 1).


The international certification of software companies
is an important factor for their development and
international expansion. No specific data is available
on the number and level of certification of Salvadorian
companies. Although there was an initiative to certify
national companies (see Exsource group in Box 2),
the enterprises are still not certified.


In El Salvador, apart from Exsource group, there are
two ICT industry associations:
(1) the Salvadorian Chamber of Information and Com-


munication Technologies (CASATIC), which repre-
sents the ICT manufacturing and marketing sector.
CASATIC was established in December 2010 by
some twenty-five companies.


(2) the Salvadorian Association of Computer Profes-
sionals (ASProC) which represents information
technology professionals.




96 Science, Technology and Innovation Policy Review - El Salvador


Argentina Brazil Costa Rica El Salvador Guatemala Honduras Mexico Nicaragua Panama


5,405 17,603 1,407 206 409 230 2,873 36 1,249


Source: UNCTAD, based on UNCTADstat data.


Table 6. Export of IT-enabled services in Latin America (millions of dollars), 2008


Figure 1. Importance of ICT in international trade, countries of Central America, 2009


M
ill


io
ns


o
f d


ol
la


rs
a


t c
ur


re
nt


p
ric


es
a


nd
e


xc
ha


ng
e


ra
te


s


Pe
rc


en
ta


ge
o


f t
ot


al
tr


ad
e


1,562


11 37 3 4 0


1,976


364


669


373


135


543


Costa Rica El Salvador Guatemala Honduras Nicaragua Panama


0%


2%


4%


6%


8%


10%


12%


14%


16%


18%


20%


Exports (millions of dollars at current prices and exchange rates)


Imports (millions of dollars at current prices and exchange rates)


Exports (% total trade)


Imports (% total trade)


0


200


400


600


800


1,000


1,200


1,400


1,600


1,800


2,000


Source: UNCTAD, based on Globstat data.


IT-enabled services


Since 2004, El Salvador has experienced considerable
growth in the market for outsourced services,
especially call centres. A considerable number of
foreign companies have established themselves in the
country to set up call centres. At present, El Salvador
has 40 call centres, of which 20 work exclusively for
customers abroad, and have generated 9000 jobs
(frost & Sullivan, 2011). El Salvador offers proximity
to the United States and competitive wages in
comparison with other Latin American countries. The
principal market in this sector is the United States (85-
90 per cent of the market) and knowledge of English in


this sector is in great demand (frost & Sullivan, 2011).
The development of this sector was promoted by the
International Services Act, 2007 (see Box 3) and forms
part of the integral export promotion strategy. This
strategy seeks to encourage the migration of current
supply to other more complex services.


The commercial data show that the wider range of
IT-enabled services still plays a small role in El
Salvador, both in absolute terms and in comparison
with other countries in the region (Table 6) and in
relative terms with regard to trade in services in El
Salvador (Table 7). furthermore, these services have
been growing slowly since 2000.




97Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


Imports Exports


2000 2005 2008 Annual growth (%) 2000-08* 2000 2005 2008
Annual growth
(%) 2000-08*


IT-enabled services 333 313 386 2% 194 186 206 1%


IT-enabled services as % of total
services 36% 26% 19% ... 28% 16% 14% ...


Communications services 27 25 45 6% 86 123 154 7%


Insurance services 113 102 189 7% 63 32 30 -9%


Financial services 38 13 12 -14% 7 7 1 -18%


Computer and information
services 14 3 5 -12% 4 .. 1 -16%


Royalties and licence fees 21 30 34 6% 2 2 1 -7%


Other business services 119 138 100 -2% 31 21 19 -6%


Personal, cultural and leisure
services 1 2 1 0% 1 ... ... .. ...


* Annual compound growth rate.
Source: UNCTAD, based on UNCTADstat data.


Table 7. Trade in IT-enabled services (millions of dollars at current prices), El Salvador, 2000-2008


The content and information media sector


The availability of relevant up-to-date and dynamic
content, in Spanish, is an incentive to use ICT. The
promotion of national content industries, especially
those for education and training, information
services for businesses and investors, or content
with marketing potential (i.e. content for mobile
phones) complements the development of the ICT
industry. In 2008, 83 companies had been identified
in the creative industries, chiefly in graphic design,
architecture, animation and digital imagery. These
industries generated 2,000 jobs, 70 per cent of which
were concentrated in 11 companies.


Box 1 highlights a series of interesting initiatives which
are taking place in the country. In the software industry
is the Exsource group, a group of companies dedi-
cated to the development of software applications.
In addition, recent years have seen a proliferation of
various initiatives in the area of digital animation, in-
cluding short films for television, animation for video
games and videogames for web platforms and, to
a lesser extent, for mobile platforms. There are also
groups of Salvadorians who are getting involved in the
development of mobile phone applications, an em-
bryonic sector which, not being consolidated at global
level, offers entry opportunities. The Government of El
Salvador is supporting initiatives in the area of mo-
bile phone application and digital animation through
the Inventa platform and the PIXELS programme (see
section B.3).


1.4. Financing through the market
In El Salvador, there are no specific mechanisms for
private financing of r&D in ICT, such as seed capital,
business angels or venture capital. It should be noted
that software development companies are faced with
additional difficulties in obtaining financing due to
their lack of sufficient physical assets, the risk inherent
in an activity based on innovation and the reluctance
of the financial system to get involved in this type of
business.


firstTuesday, a meeting place for businessmen, in-
vestors and entrepreneurs of innovative businesses is
a recent initiative and a step in the right direction in
identifying financing needs and bringing investors and
entrepreneurs together.


1.5. Bodies which disseminate
knowledge


The principal input in the software sector is knowledge.
In El Salvador, a large number of universities and
higher education institutions provide education in
computer technologies. Annex G is a summary of
current educational provision.


El Salvador has a considerable number of students
in areas related to information technology at degree
or technical level (see Table 8). however, the number
of university students who ultimately graduate is
considerably lower. To encourage a larger percentage
of graduates, it will be important to understand the




98 Science, Technology and Innovation Policy Review - El Salvador


Box 1. Examples of Salvadorian potential in ICT and ICT-based services


Software development
Exsource group is an affiliated group of companies dedicated to research and development of software applications
established in 2003 in the framework of a programme for the development of clusters. Its start-up was made possible
thanks to financial support of 400,000 dollars provided by the Government of El Salvador, the Inter-American Development
Bank and private companies. Its objectives include promotion of quality in the sector through CmmI certification of the
17 affiliated companies. It currently has a software factory constituted by five companies which generates 30 direct jobs
and has an annual turnover of more than 200,000 dollars.


Mobile phone applications
Mindblock is the first Salvadorian company to devote itself mainly to the development of video games. It was formed
towards the end of 2010, bringing together talents from various disciplines. on 14 february 2011, they launched their first
formal product on the market, under the name “Pest fest”, which is available for iPhones, iPods and iPads in iTunes, and
the download costs 0.99 dollars. The three partners in the company met thanks to the Pixels programme. This programme
also allowed them to publicize their skills and products.


Digital animation
Virtual Grafix Animation Studios, established in 2000, is a company which specializes in 3D animation, architectural
visualization, multimedia projects (production of CDs and DVDs), television commercials, audiovisuals and graphics, and
has successfully exported its services to the United States, Panama, Guatemala and honduras.


Happy Punk Panda Studios is a company with five years’ experience dedicated to digital animation and the development
of digital advertising campaigns.


The animation industry requires the involvement of publishers, producers, illustrators, animators and scriptwriters. At present,
there is a need to improve the teamwork with specialists in these different areas in order to be able to offer products of
better quality. In addition, the industry demands better trained animators who can carry out more complex tasks, such as,
for example, creating pace and acceleration and bringing characters to life.


Given the size of the domestic market, it is important for both companies to obtain support for exports and access to market
intelligence. These are areas where public programmes could be very effective.


Source: UNCTAD, based on MINEC (2011), www.virtual-grafix.com, www.pixelsawards.com/, www.mindblockgames.com, http://
happypunkpanda.com/


causes of dropping out or falling behind in studies.
measures of various kinds, student support or
adaptation of education programmes could improve
the graduation rate.


The number of postgraduate students of computer
studies, information technologies or systems is
very small, and there are no doctorates in this
area. Various people mentioned the need for more
specialized postgraduate courses which could meet
the expectations for the development of an innovative
local industry. There exist academic institutions
interested in providing these courses, but without a
greater availability of scholarships for students, the
demand is insufficient.


Several experts consulted also mentioned the need
to have a greater supply of computer and systems
technicians. The student population in technical
studies related to information technologies is small
(5,824) compared with university level students
(12,936). however, given the low rate of graduation


of university students in these areas, the number of
graduating technical students has been higher than
university graduates in the last two years.


INSAforP also offers training courses in computer
techniques. In 2009, this institution (see Chapter 2)
trained over 800 people in this area. INSAforP’s
training work could be amplified, both in number
(currently it only represents 2.8 per cent of the total
number of people trained by the institution) and the
type of courses offered, offering more specialized or
advanced ICT courses.


Several experts pointed out that the educational
provision does not adequately meet demand in
the sector. on the one hand, there is an underlying
demand for people with technical level training as
well as specialized training. on the other, university
students are trained in a wide range of subjects
to give them more opportunities for finding work
and there is a lack of more specialized education.
The experts consulted indicated various areas (for




99Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


Student population Graduates


2005 2006 2007 2008 2009 2005 2006 2007 2008 2009


Master of computer studies 15 20 8 4 - - - 12 - -


Master of systems - - - - 22 - - - - 4


Master of communication
technologies - - 5 9 7 - - - - 7


Subtotal: postgraduates 15 20 13 13 29 - - 12 - 11


Computer engineer 7,206 2,818 2,180 2,213 3,910 331 104 147 162 296


Systems engineer - 4,403 5,633 5,984 4,284 - 215 246 296 224


Telecommunications engineer 300 316 341 389 416 - 3 3 17 29


Degree in computer studies 5,022 3,662 3,440 3,755 3,514 207 204 532 431 395


Degree in systems - 917 911 879 812 - 35 74 59 65


Subtotal: graduates 12,528 12,116 12,505 13,220 12,936 538 561 1,002 965 1,009


Computer technician 2,167 1,987 2,018 2,984 3,295 418 397 517 749 836


Electronic communication
technician 62 58 71 - - 11 16 13 - -


Systems technician 1,688 2,202 2,597 2,632 2,371 290 364 456 787 664


Telecommunications technician - - 8 113 158 - - - 23 33


Subtotal: Technicians 3,917 4,247 4,694 5,729 5,824 719 777 986 1,559 1,533


Source: UNCTAD, based on MINED data (2010).


Table 8. Training in information technologies in El Salvador


example, software development for mobile phones)
with potential and which require specialized training.
In general, these educational programmes seem to
be updated on a reactive basis.


In El Salvador, various institutions offer certificates in
information technology. The wide number of possible
certificates, from supplier certificates (e.g. microsoft
or CISCo) to internationally recognized third party
certificates (e.g. CmmI at its five levels), as well as their
cost, makes choosing them difficult for both students
and the institutions that offer them. A continuous
dialogue between the private sector and educational
institutions could be used to design and offer training
and certification programmes which meet industry
demands.


1.6. Bodies which generate knowledge
In El Salvador there are a limited number of
organizations which carry out r&D in the area of
ICT. There are no statistics in this respect, but the
information gathered suggests scant investment in
r&D both in the productive sector and the educational
sector. on the one hand, bearing in mind the type of
activities carried out by companies in the sector and


their size, investment in r&D by the private sector
cannot be very high either. As shown in Section B.1.5,
software development companies in the country are
few. on the other hand, in 2009, higher education
institutions allocated 4.6 million dollars to the exact
and natural sciences in total (which include information
and computer sciences) and 1.6 million dollars to r&D
in engineering and technology which include, among
other things, computer engineering (Table 9). In the
educational sector, some r&D activities are carried
on, although many of them are student dissertations.
The bibliometric study expressly carried out for this
review (see Annex f) did not identify any relevant
publication in these areas.


Neither does the number of ICT researchers appear
to be very high. In 2009, there were a total of 27 re-
searchers in the exact and natural sciences in total
(which include information and computer sciences)
and four in engineering and technology which include,
among other things, computer engineering (Table 9).


It should be noted that not all software development
activities can be considered as r&D activities.
According to the frascati manual, (oECD 2002, pp.46
and 47), for a software development project to be




100 Science, Technology and Innovation Policy Review - El Salvador


Expenditure on R&D (dollars) Researchers
Teacher-


researchers


Exact and natural
sciences


Mathematics, information and computer sciences,
physical sciences, chemical sciences, earth sciences,
biological sciences 4,648,730 27 15


Engineering and
technology


Civil engineering, electrical engineering, electronic
engineering, information engineering, mechanical
engineering, materials engineering, medical engineering,
environmental engineering, environmental biotechnology,
industrial biotechnology, nanotechnology, other
engineering and technology 1,601,620 4 88


Source: UNCTAD, based on CONACYT data (2010).


Table 9. R&D expenditure and personnel in exact and natural sciences and in engineering and technology, 2009


classified as r&D, its completion must be dependent
on a scientific and/or technological advance, and the
aim of the project must be the systematic resolution
of a scientific and/or technological uncertainty.
Software-related activities of a routine nature, such as
business application software and information system
development using known methods and existing
software tools, are not to be included in r&D. (oCDE
2002).


Among the principal educational institutions which
undertake research in this field, special mention should
be made of ITCA and Don Bosco University. ITCA
promotes applied research projects. In 2009, it carried
out six research multi-disciplinary research projects,
including a software development project that applied
artificial intelligence technology. In addition, as a result
of research projects in earlier years, ITCA-fEPADE
has obtained copyright registration for four computer
programmes (ITCA-fEPADE, 2010). The school has
three laboratories in the information technology area:
hardware design, electric machines and PLC16, and
network design. These laboratories were built with the
help of international cooperation.


The research projects carried out by Don Bosco
University include:
- Development and implementation of supercom-


puter models,
- Development of fourth generation technologies in


mobile applications, and
- Development of a didactic computer for teaching


basic programming.


This University has several ICT-related laboratories,
including a computer laboratory and an electronics
laboratory.


2. Cohesion and prospection functions
– policy system


In the last fifteen years, various processes and
strategies have been established to promote the
development of the information society in El Salvador
(see figure 2). The principal initiatives were:
- The reform of the telecommunications sector in 1996


which brought about the development of the sector
(see section B 1.1. above).


- The “Connecting to El Salvador’s future” initiative
in 1999, which stimulated the development of
infocentres in the country.


- A draft National Information Technology Policy
prepared by the National Information Technology
Committee and endorsed by CoNACYT, but which
was not approved at government level.


- The establishment of a National Commission for the
Information Society, comprising participants from
the public and private sector, academia and civil
society.


- The “eCountry Programme” launched by the
President of the republic of El Salvador in 2005. This
integral programme unites the various ICT initiatives
and incorporates new ones.


- The National eCountry Programme Strategy
2007-2021, drawn up by the National Commission
for the Information Society in 2006. It identifies
five strategic lines (infrastructure, electronic
government, development of the knowledge society
and human resources in ICT, the ICT industry and
electronic commerce, and the legal and institutional
framework).


- The establishment of the Technology and Computer
Innovation Unit of the Government of El Salvador




101Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


(ITIGES), under the Private Secretariat of the
Presidency in 2009.


- The Integral Export Promotion Strategy 2010-2014,
and the strategic planning bases 2010-2014, which
focuses on export and investment development in
the IT sector, business processes based on ICT and
the creative industry.


The eCountry Programme includes a strategic line
on the ICT industry and its collaboration with the rest
of the productive sector. It should be noted that in
practice the eCountry Programme is not being used
as a reference framework.


Various government bodies have been responsible
for the design of these plans and programmes (and
even the implementation of activities) in the ICT area
(see figure 3), but no entity has been assigned
responsibility for the governance of the information


society which, among other things, is concerned
with the vision of the future and the determination of
integral strategies, and which lays down policies that
can bring cohesion to the system.


It should be emphasized that no evaluation or
monitoring has taken place of the achievements at
national level in the development of the information
society which would allow the necessary adjustments
to be made. Neither have there been any technological
foresight studies which allow priorities to be set for the
development of ICT infrastructure.


As regards innovation policies in the ICT sector, El
Salvador does not have a specific policy in this area,
but public policies on support for science, technology
and innovation17 include the ICT sector as one of the
priority sectors. however, as mentioned in Chapter III,
in general, these plans are very broad and ambitious
for the available resources.


Figure 2. Initiatives of the Government of El Salvador to create an information and knowledge society


2004 2009


ITIGESElectronic
Government
Strategy


2005


Integral
eCountry
Programme


2006


National
eCountry
Strategy


2000


Draft National
Information
Technology
Policy


2002


National
Commission
for the
Information
Society


1996


Reforme of
the telecom-
munications
sector


2010


Integral
Export
Development
Strategy


1999


“Conecting to
El Salvador's
Future” initiative
and Infocentres


Source: UNCTAD, based on the National eCountry Programme Strategy (CNSI 2006) and ITIGES (2010).


Figure 3. The principal government bodies involved in the system of ICT policies


Vice Ministry of Science
and Technology


CONADEI


ITIGES


MINISTRY OF ECONOMY


MINISTRY OF EDUCATION


TECHNICAL SECRETARIAT
OF THE PRESIDENCY


Directorate of Productive Export
Development (FOEX)


SIGET


Vice Ministry of Trade
and Industry


Autonomous bodies


Source: UNCTAD.




102 Science, Technology and Innovation Policy Review - El Salvador


Source: UNCTAD.


Figure 4. The principal government bodies involved in the ICT management, control and regulation systems


ITIGES


MINISTRY OF ECONOMY


MINISTRY OF EDUCATION


TECHNICAL SECRETARIAT
OF THE PRESIDENCY


Vice Ministry of Trade
and Industry


EXPORTA


PROESA


SIGET


CONAMYPE


CONADEI


Autonomous bodies


Vice Ministry of Science
and Technology


National Directorate of Scientific and
Technological Research and Innovation


National Directorate of Scientific and
Technological Education and Innovation


Directorate of Innovation and
Technological Development


Directorate of Productive Export
Development (FOEX)


DIGESTIC


3. Management, control and regulatory
functions – links between the policy
system policies and the executing
system


In El Salvador, there are various public institutions
responsible for the implementation of programmes
and projects in the ICT area (see figure 4). The
principal institutions and programmes are described
in detail below, based on the five strategic lines
identified in the eCountry Programme: infrastructure,
electronic government, human resources in ICT, ICT
industry and regulatory framework.


Infrastructure


In the telecommunications sphere, the main institutional
reference is the General Superintendency of Electricity
and Telecommunications (SIGET), the regulatory
body for the sector. however, there is no institution
responsible for laying down telecommunications
policy like the telecommunications boards that exist
in other countries.


Electronic government


In the sphere of electronic government, the Technology


and Computer Innovation Unit of the Government of
El Salvador (ITIGES), under the Private Secretariat of
the Presidency, is responsible for the development of
electronic government. Its work strategy is focused
on the development of electronic government in the
strict sense, and does not include responsibilities for
the development of the ICT infrastructure, regulatory
framework, development of an ICT industry or the use
of ICT by the business sector18.


The work programme has focused on the standard-
ization of ministry gateways19 and a programme of
e-regulations which provides on-line information on
all procedures involved in doing business in El Sal-
vador. Special mention should be made of the on-line
tax declaration services, developed by the ministry of
finance, and the interrelation with the bank to make
payments in real time.


other government institutions have developed
electronic procedures on their own account (e.g.
the Social housing fund and the National records
Centre), but the number of institutions which allow
transactions with the public administration is still
limited, and there is no interface between the different
institutions20.




103Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


Through public procurement, for example by contract-
ing software development services, the administration
can support the development of the local ICT industry.
Several of those involved indicated that at present the
role of ICT public procurement as a factor in the de-
velopment of a local ICT industry is limited. on the one
hand, public investment has focused on replacement
of hardware. on the other, ITIGES has its own team
which develops software applications. furthermore,
some companies in the sector have difficulty in being
able to conclude contracts with the public administra-
tion and have decided not to offer their services to the
public sector.


Education and research in ICT


one of the seven components of the National Scien-
tific and Technological Development Plan proposed
by the Vice ministry of Science and Technology (see
Chapter 2) is the development of ICT based on two
programmes: (1) development of the knowledge-
based society, with projects to strengthen access to
and use of ICT, and (2) development of mSmEs in ICT.


Currently, the Vice ministry of Science and Technology
is promoting the use of ICT in the national education
system through its ICT access projects in schools,
promotion of responsible use of the Internet and pro-
motion of knowledge of programming and application
of software among the teaching profession. The an-
nual financing required for these three programmes is
one million dollars21.


As well as public programmes, there is a series of
programmes supported by civil society and private
sector organizations which support the development
of technical capacities in children and adolescents.
for example, the Connection to Development
Association, through a network of telecentres, offers
ICT access services and training in their use for
artisans and mSmEs (ECLAC, 2010c). The Ágape
Association22, has a training programme in ICT,


English and investment for young people with limited
resources.


Through the higher Education research fund (fIES),
in its two rounds, three research projects in the area
of ICT have been financed (see Table 10) for a total
amount of 198,000 dollars, matched by an investment
of 66,000 dollars by the higher education institutions.


No public programmes for the development of an
infrastructure for innovation in ICT are known (e.g.
support for incubation of ICT companies or the
development of quality software laboratories). The
new National Centre for Scientific research of El
Salvador (CICES) does not include ICT research
among its priorities.


Promotion of the ICT industry


The International Services Act, 2007, grants benefits
and tax incentives to national and foreign investors in
the area of information technologies.


The promotion of ICT, business process outsourcing
based on ICT and a related content industry form
part of the current plan for export and investment
promotion (see Bases of Strategic Planning 2010-
2014 of the National Export and Investment Promotion
Commission (CoNADEI, 2010). In these areas, the
strategy identifies the following objectives.


In information technology:
- Specialization and certification of professionals,


technicians and companies in the country
- Promotion of software companies or developers


and attraction of investment in data processing and
outsourcing of IT


- Creation of incentives for the software sector
- Improvements in accounting of software exports.


Business process outsourcing, voice and non-voice
services:
- Development of bilingual human capital


IES Project
Financing (in dollars)


FIES Counterpart Total


Don Bosco University Development and implementation of supercomputer models 49,988 16,662 66,650


Francisco Gavidia
University


Creation and implementation of an incubator for information
and communication technology companies 100,000 33,333 133,333


Catholic University of
El Salvador


Voice over IP platform (VoIP) in advanced networks using
open code 47,980 15,993 63,973


Table 10. Projects in the ICT area financed by FIES, 2008 and 2009




104 Science, Technology and Innovation Policy Review - El Salvador


- Investment Promotion (ProESA)
- Development of local industry (EXPorTA)
- Adaptation of the regularity framework
- maintenance of the existing industry


In business processes which make intensive use of
knowledge – creative industry:
- financing and entrepreneurship
- Promotion and attraction of investment
- Legal and institutional framework


In addition, the National Scientific and Technologi-
cal Development Plan proposed by the Vice ministry
of Science and Technology (see Chapter II) also in-
cludes a programme of development of mSmEs in the
ICT sector. It includes three specific projects:
- Support for the creation and development of


enterprises in the ICT sector
- Support for ICT enterprises to bring them under the


International Services Act
- Incentives for the use of ICT in distance learning,


electronic commerce, multimedia production,
telemedicine and others.


These plans do not identify specific objectives for
these programmes, nor the financial and human
resources to implement them, not do they assign
responsibility for their execution and evaluation. There
is no budget and/or fund dedicated to the promotion
of the ICT industry. Neither has an entity been explicitly
designated, with responsibility for promoting the
development of the ICT industry and the use of ICT in
the country’s productive activities.


In addition, the Directorate of Innovation and Tech-
nological Development in the ministry of Economy,
through the Pixels programme and the Inventa plat-
form, promotes innovation in this sector chiefly by
contributing to the creation of conditions which fa-
cilitate entrepreneurial capacity building and through
coordination with different bodies and programmes.
The Pixels Digital Animation Awards is a digital anima-
tion competition organized by the ministry of Econo-
my. The TIGo mobile Challenge, a competition spon-
sored by fUSADES in conjunction with francisco Ga-
vidia University, held for the first time in 2010, seeks to
stimulate the development of applications for mobile
devices.


All these proposals and initiatives are highly pertinent
and necessary but the current scope and financing
of the programmes is insufficient to support the
development of an innovative ICT and ICT services
sector.


To be able to achieve strategic advances, a wider
range of resources will be necessary, including higher
levels of public and private investment in r&D in ICT,
greater university-company collaboration to link up
research activities, generate innovative products,
adapt educational provision and develop a range of
technological services which meet the needs of the
industry, as well as an infrastructure for innovation
in ICT. The lack of a forum for effective interaction to
discuss needs and possibilities in this area is a major
institutional gap. It will also be necessary to coordinate
related support policies in the sector, that is, a complete
alignment of the respective work agendas to generate
synergies and, ultimately, greater impact.


As mentioned above, there is no up-to-date informa-
tion on the ICT industry and its activities nor on the
use of ICT by Salvadorian companies. DIGESTYC col-
lects data on the ICT industry in its economic census,
although not all the headings are listed and the last
census dates from 2005. DIGESTYC also collects in-
formation on the use of ICT by individuals through its
household survey, but up to now it has not collected
information on the use of ICT by companies. CASAT-
IC, the Salvadorian Chamber of Information and Com-
munication Technologies, has included as part of its
work plan24 the elaboration of a census of ICT compa-
nies in El Salvador, in order to be able to undertake a
needs assessment. In march 2011, it still did not have
the financing to carry out the census.


Regulation


Box 2 provides a summary, albeit not exhaustive,
of the regulatory framework in the ICT sphere. The
UNCTAD study of the prospects for harmonizing
cyberlegislation in Central America and the Caribbean
(2010Aa) provides more detailed information on the
current state of Salvadorian legislation concerning
electronic commerce.


It should be emphasized that, in El Salvador, there is
no special legislation governing electronic commerce,
but there are various general laws which apply. In legal
proceedings, especially with regard to the evidential
value of electronic documents, there are not specific
rules (UNCTAD, 2010a). In 2000, a preliminary
Electronic Commerce Bill based on the UNCITrAL
model law was prepared but not approved (molina
Tamacas, 2009). Since then, various bills have been
proposed in this sphere. In the regulatory sphere, the
main priorities to encourage the development of the




105Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


ICT industry are the approval of a law on electronic
signatures and a law on data protection.


Several representatives of the private sector also
mentioned limitations in El Salvador’s regulatory
framework in promoting public procurement of
software from domestic companies. CASATIC and
ASProC, in their proposal to the Government of El
Salvador, advocate adaptation of the law in order to
favour the participation of domestic companies which
tend to be of smaller size and have greater difficulties
in participating in public procurement processes. In
particular, they suggest adapting contract periods
and urged that in contracting foreign companies, the
participation of domestic companies, which could
provide support, should be required. The reform of
the Public Procurement and Contracts Act (LACAP)
approved in may 2011 seeks, among other things,
to streamline public contracting and encourage the


participation of domestic mSmEs. It provides, for
example, that central and local government entities
must procure from or contract with domestic micro,
small and medium-sized enterprises to the value of at
least 12 per cent of the annual budget for procurement
and contracting of goods and services, subject to
guarantees of quality.


The Legislative Assembly of El Salvador, the
principal legislative body of El Salvador, does not
have a committee dedicated to matters of science,
technology and innovation. The Committee on Culture
and Education of the Legislative Assembly marginally
deals with aspects of science and technology, and
the Committee on Economy and Agriculture analyses,
among other things, legislation regulating telephony
services.


Box 2. Salvadorian legislation on ICT 1


Telecommunications
- Telecommunications Act. Legislative Decree No. 142 (1997) and Telecommunications reform Act. Legislative Decree No.


379 (2010) which approved digital portability.


Electronic transactions and electronic signatures
- Legislative Decree No. 523 (2001). reform of Legislative Decree Nº 529/1999 on Simplification of Customs (1999).
- Banking Act. recognizes the legal validity of electronic transactions and the use of electronic signatures.
- Act of Electronic Entries of Value in Account. recognizes the use of electronic media for electronic transactions.


Consumer protection
- The Consumer Protection Act does not contain specific provisions on electronic commerce, but as the means by which


suppliers offer their products and consumers acquire them are not distinguished, the general rules apply to on-line
transactions.


Intellectual property (relating to telematic media)
- Decree 604 (1993) Promotion and Protection of Intellectual Property Act.


El Salvador has ratified:
- The WIPo Copyright and Performances and Phonograms Treaties.
- The Universal Copyright Convention.
- The Brussels Convention on relating to the Distribution of Programme-Carrying Signals Transmitted by Satellite
- The Central American Convention for the Protection of Intellectual Property.
- The Dominican republic - Central America - United States free Trade Agreement .
- The Agreement on Aspects of Trade-related Intellectual Property rights.


Electronic government
- Decree No. 79 (2004): Creation of the National Commission for the Information Society. reforms incorporated by Decree


No. 140 (2005)
- Legislative Decree No. 868 (2000). Public Procurement and Contracts Act. reforms incorporated by Decrees 140 and


203 (2009) and Decree No.725 (2011)
- The Tax Code authorizes tax declarations through electronic communication networks


(cont.)




106 Science, Technology and Innovation Policy Review - El Salvador


Box 2. Salvadorian legislation on ICT 1 (cont.)


- The Simplification of Customs Act, establishes the basic legal framework for the adoption of mechanisms for the
simplification, facilitation and control of customs transactions through the use of automated information exchange
systems.


- The International Services Act, regulates the establishment and functioning of service parks and grants benefits and tax
incentives to national and foreign investors, including in the area of information technologies and r&D.


Access to public information
- Act on Access to Public Information, approved by Legislative Decree 534 (2010), guarantees the right of access of all


persons to public information.


Principal legal initiatives
- Electronic Communications and Signatures Bill.
- Bill to reform the Criminal Code of El Salvador (to cover computer crime), presented to the Legislative Assembly in July


2010.
- Data Protection Bill.


Source: UNCTAD (2010a) and based on official documents.
(1): Non-exhaustive list.


c. concluSIonS AnD
REcommEnDATIonS


The level of development of the local ICT industry is
still embryonic and cannot be described as a system
of innovation in ICT as such.


The country has strengths and opportunities to de-
velop the ICT sector. There is a wide range of training,
both at technical and graduate level, and, to a lesser
extent, postgraduate. There are a considerable num-
ber of companies established in the country, including
international companies and a large number of smaller
entrepreneurs and companies. Various bodies, public
and private, express interest in promoting the devel-
opment of ICT and the country has a developed ICT
infrastructure which allows such activities.


Nevertheless, it cannot be said that the local ICT industry
is a competitive innovative sector at international level.
The sector is still small and has difficulty in exporting
its services. The level of investment in r&D is meagre,
the links between universities and the private sector
are limited and there are bottlenecks in training and
accreditation and certification of institutions and
companies. International and regional competition,
given that there are more competitive actors in the
Central American region itself, is a major threat to the
development of this heterogeneous sector, which is
also faced by limited Internet use for government and


banking transactions. Support for the sector is limited
by the scarcity of available public resources.


The emergence of an innovative ICT sector requires an
adequate provision of well qualified human resources,
more investment in r&D (both in the educational system
and by the private sector), entrepreneurial capacity
to develop and market services, and an appropriate
regulatory framework to encourage investment in ICT
and supply and demand for services in this area. In
order to generate more value, given the limited scale
of the domestic industry, it will be important to develop
specific niche markets where companies can compete
at international level.


If it is desired to reverse this situation, what is needed
is to reinforce and consolidate the strategic vision of
support for the sector. A series of recommendations
are presented below.


Recommendations
1) Develop a national strategy for the development of the
ICT sector.
- Strengthen the productive aspects of the eCountry


Programme, promoting greater concern among all
those involved to strengthen the ICT sector, identify
a set of priority actions to develop the sector, estab-
lishing the responsibilities of the various actors and
identifying the necessary resources. These actions
must be centred around the five areas listed below.




107Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


Table 11. Principal strengths and weaknesses, opportunities and threats of the ICT sector


STRENGTHS WEAKNESSES


• Ample education and training provision
• Ample supply of companies and entrepreneurs in the ICT area
• Various bodies (public and private) express interest in promoting


ICT.
• Developed ICT infrastructure, especially in the main economic


centres


• Limited scale and international competiveness of the sector
• Limited provision of specialized education, especially at


postgraduate level.
• Low level of investment in R&D in the sector
• Few links between universities and the private sector
• Low levels of adoption of international certification, educational


accreditation and quality control in the sector.
• Important elements of the legal framework not yet established
• Limited access to financial resources for ICT (lack of seed and


venture capital, limited public funds)
• Limited consolidation of a joint strategy for the public, private


and academic sectors to develop the sector.
• Lack of conviction of the importance and cross-cutting impact


of ICT in productive activities


OPPORTUNITIES THREATS


• Support initiatives for innovation: digital animation, mobile
phone applications


• Opening up of trade: opportunities to increase technological
capacity, purchase of capital goods, access to new
technologies, incentives for innovation


• Electronic government
• Foreign investment – International Services Act
• Support from international cooperation
• Public and private initiatives in support of access to and training


in ICT for disadvantaged sectors
• International and regional collaboration on ICT


• Regional and international competition.
• Scarcity of available public resources.
• Limited Internet use to carry out bank transactions and


transactions with state organizations and public authorities
• Heterogeneous businesses: broad micro and small enterprise


sector with low productivity.


Source: UNCTAD.


- Establish a forum for dialogue between the education
sector, public bodies and representatives of the
private sector which, among other things:


- facilitates the process of identifying areas with the
greatest potential


- examines the educational needs of the sector and
promotes the updating of educational provision


- identifies opportunities for joint research


- identifies services required by the business sector


- which could be provided by the academic sector.


2) Improve the quality of education and training in the ICT
sector.


- Develop a programme of financial support for certifi-
cation and accreditation of persons, institutions and
companies in the ICT sphere.


- Examine educational needs in the sector and promote
updating of the educational provision in the area.


- Establish a programme of scholarships for students
and training for teachers, for postgraduate training in
El Salvador and abroad


- review the ICT training provided by INSAforP and
adapt it on the basis of a review of the needs of the
business sector in the short and medium term.


3) Support ICT research in universities and companies.


- Increase financing of ICT research.


- require participation of companies in research funds
for higher education institutions.


- Establish one or two research fellowships in ICT (at
postgraduate level) in areas identified as having the
greatest potential, in which at least one academic in-
stitution and one company in the sector collaborate.


4) Establish a set of measures to develop greater business
sophistication in the sector, where Salvadorian companies
can consolidate, carry out larger-scale projects, compete
at international level, and provide specialized and added
value services.


It is recommended to:


- Strengthen the mechanisms of incubation of tech-
nology-based companies.




108 Science, Technology and Innovation Policy Review - El Salvador


- Strengthen the supply of services and capacities in
competitive intelligence in the ICT sector.


- foster the development of other sources of financing
for the sector (development of venture capital,
guarantee funds, fiscal measures).


- Promote entrepreneurial development of other ICT-
related sectors which complement the development
of technology-based companies, especially the
content industry .


- Develop the programme to promote foreign direct
investment in the sector, with priority to investment in
areas with the greatest potential and added value, or
which complement them.


- Consolidate initiatives to support innovation in ICT
undertaken by the ministry of Economy, providing
them with more resources and promoting their
outsourcing.


- Establish a set of actions to promote the adoption of
ICT by SmEs.


- Encourage further development of electronic
government services, especially those which are
most relevant to companies and/or based on mobile
platforms, and facilitate the participation of domestic
companies in public procurement related to the their
development and that of other ICT services.


5) Collect information on innovation activities and areas
of greatest potential in this sector, carry out a prospective
survey of the ICT sector and strengthen monitoring and
evaluation of capacities, policies and programmes.


Consistent with the recommendations of a general
character for the whole system of innovation, it is
recommended:
- To support the conduct of a national survey of


innovation which specifically includes the ICT sector,
in order to identify current capacities, incentives and
barriers to innovation and potential.


- Also, ensure that the proposed national prospective
technological study identifies niches with the greatest
added value and potential in the ICT sector and on
which public efforts should concentrate.


- Systematically monitor, evaluate and publish the
impact of policies and support programmes in the
sector.


- monitor access to and use of ICT in small and
medium-sized companies.


6) Complete the current regulatory framework in order to
stimulate the use of ICT and confidence in the sector and
drive its development:
- facilitate the adoption of the bills on electronic


signatures and transactions and on data protection.
- review possible obstacles in the regulatory


framework in order to strengthen the impact of
public procurement on the development of the
domestic ICT industry.


- raise awareness among the principal actors,
especially members of the Legislative Assembly, on
the regulatory aspects of ICT.


- In the medium term, consideration must be given to
updating the regulatory framework to take account
of mobile telephony.


This set of recommendations needs to be fleshed out
on the basis of a broad consensus and commitment
of all those concerned. It is therefore proposed,
as a first step, the establishment of a forum for
dialogue between the education sector (including
higher education institutions and INSAforP), the
private sector (including Exsource group, CASATIC
and ASProC) and public bodies (including ITIGES,
the ministry of Economy, the ministry of Education
and SIGET). This forum must, first of all, identify the
specific areas of the ICT sector with the greatest
potential and on which efforts are to be centred. As
far as possible, the identification of these priority
areas must be supported by the national prospective
technology survey.


Given the current size of the sector, it is not considered
appropriate to establish a specific governing body for
ICT, and it is considered that the proposed governing
body for science, technology and innovation (see
recommendations in Chapter VI) could provide
guidelines to foster innovation in the ICT industry. The
forum for dialogue suggested here could support the
STI governing body in the ICT sphere.


Some of the recommendations which could be
implemented in the short term include the review of
the educational needs of the sector, consolidation of
the initiatives to support innovation in ICT which are
currently being taken by the ministry of Economy and
Exsource group. Subsequently, depending on the
results of the prospective survey, these activities may
need to be adjusted.




109Chapter V: INformATIoN AND CommUNICATIoN TEChNoLoGIES


noTES
1 oECD definition 2006-07. In oECD (2009) Guide to measuring the information society, 2009.
2 figures from NASSCom, chamber of commerce for the information technologies sector of India.
3 The concept of information workers is a much broader concept than workers in the ICT sector.
4 See UNCTAD 2009.
5 See SIGET 2011.
6 See UNCTAD 2010c.
7 ITU World Telecommunications Indicators database.
8 The international comparison of the cost of Access to ICT between countries is not simple, and requires a number of


assumptions. for more details of the methodology used in the elaboration of the ICT basket of prices, see ITU (2010).
9 Don Bosco University, ITCA.
10 José Simeón Cañas Central American University, Don Bosco University, Technological University, francisco Gavidia


University, Catholic University of El Salvador, Specialized School of Engineering ITCA and the University of El Salvador.
11 See observatory for the Information Society in Latin America and the Caribbean, oSILAC, (2010 p. 104).
12 See measuring-ict.unctad.org/.
13 for further information on the importance of the architecture of technologies designed for services and Internet services


for companies, see UNCTAD (2009).
14 Based on the oECD definition of ICT sector in 2002 (based on the International Standard Industrial Classification,


rev 3.1).
15 See reference in CoNADEI (2010).
16 Programmable Logic Controller.
17 The National STI Policy of El Salvador 2006-2030, the draft National Scientific and Technological Development Plan


(2011), the National research Agenda 2010, and the Integral Export Development Strategy 2010-2024.
18 See ITIGES (2010) and Lito Ibarra (2009).
19 See www.presidencia.gob.sv/index.php/temas/ticas/estandarizacion-y-actualizacion-de-los-sitios-web-de-las-


instituciones-del-gobierno, 15 September 2010.
20 See ECLAC (2010).
21 According to the draft budget for the execution of the National Scientific, Technological and Innovation Development Plan


(2011).
22 See Ágape-Supérate programme at www.agape.com.sv.
23 As a result of this project, starting in 2010, francisco Gavidia University has GErmINA, an ICT enterprise incubator.


Its mission is to foster and stimulate entrepreneurship and accelerate the gestation of innovative projects in technology,
to transform them into successful companies.


24 See draft ICT-based strategic development projects of El Salvador prepared by CASATIC and ASProC (2011).






Conclusions and recommendations.
A road map for strengthening the


system of innovation of El Salvador




112 Science, Technology and Innovation Policy Review - El Salvador


A. ConCluSIonS And
RECommEndATIonS


The economic and social development of El Salvador
requires scientific, technological and innovative
capacities. El Salvador, a small and open economy
endowed with limited natural resources, needs to base
its growth in increased productivity and productive
transformation towards activities with a higher
technological content that increase the production of
higher added value goods and services. This would
foster a virtuous circle of learning and dissemination of
technology and, ultimately, would allow the country to
be competitive internationally. Achieving this requires
the development of capacities to adopt, use, adapt
and generate knowledge. These capacities develop
with investment (both public and private) in activities
which generate knowledge and STI as well as with
the strengthening of a national system of innovation
that promotes and facilitates these activities and their
application in the productive sectors.


El Salvador lacks adequate systemic conditions to
develop capacities to adopt, use, adapt and generate
knowledge. There is no governmental body which
provides direction and supervises policies concerning
STI. Neither is there an articulated system of STI
policies, but rather isolated policies focused either on
science and technology or on innovation, industrial
development or exports. No foresight exercise
has been carried out to identify research strengths
and production capacities, and establish priorities
from which development programmes and policy
instruments are derived. A lack of monitoring and
evaluation of policies and programmes to allow making
the necessary adjustments was also observed.


As regards the generation of knowledge, the research
sector is weak in human and financial resources,
has little private involvement and is heavily weighted
towards the social sciences and humanities. Levels
of investment in R&D, both public and private, are
extremely low. Furthermore, there is little contact
between the knowledge generating bodies and the
productive sector and current research efforts have
little impact on improvements in production. The
productive sector does not demand knowledge or
technology, there is little awareness of the utility of
knowledge in generating value, there are few financing
options and a limited number of innovation policy
instruments with limited budgets.


The education system suffers from serious weak-
nesses. Education in general, and higher education
in particular, has ample room for improvement, espe-
cially in terms of quality, the expansion of science and
technology teaching and research work.


Despite these shortcomings, there are a number of
capacities in the sphere of STI which can be developed
and on which successful results can be built. There is
scientific research with international impact, especially
in the health sciences. There are also high quality
educational nuclei. There are innovative companies
and some positive experiences of university-company
collaboration, such as the design of specific study
programmes. There is interest in various quarters
in promoting science, technology and innovation,
from various public institutions, non-governmental
organizations and international cooperation. However,
there is a general lack of interest on the part of the
private sector. Lastly, the bases of the legal framework
are adequately established such that they do not put
a brake on innovative activity.


The country also has a number of factors which
offer opportunities for capacity building in science,
technology and innovation. El Salvador has a good
road and air transport system and telecommunications
infrastructure (especially mobile telephony). There are
also national programmes, such as the port of La Unión
or Fomilenio which offer opportunities for development
of technological capacities and innovation. The
strong presence of Salvadorians abroad is a channel
of access to valuable resources and knowledge.
Productive diversification provides opportunities for
progress in many areas and the opening up of trade
is an incentive to innovation by increasing competition
and by facilitating the purchase of capital goods and
access to new technologies. International cooperation
makes an important contribution to the development
of innovation skills, and there are ample opportunities
for greater international collaboration in research
and innovation. Finally, the country enjoys broad and
continuing agreement on the macro-economic stability
policies and openness to trade which encourage
private sector (domestic and foreign) confidence to
invest in the country.


The country must face the challenge of building STI
capacities against a background of scarce public
resources. The weaknesses of public institutions,
for example in the sphere of policy coordination,
also represent a threat to the development of these
capacities which require broad agreement and clear




113
Chapter VI: CoNCLUSIoNS AND RECommENDATIoNS. A RoAD mAP FoR STRENgTHENINg


THE SySTEm oF INNovATIoN oF EL SALvADoR


Table 1. Principal strengths, weaknesses, opportunities and threats in the national system of innovation of El Salvador


STRENGTHS WEAKNESSES


• Pockets of scientific research
• Results in areas of the health sciences
• Pockets of high quality education
• Pockets of innovative enterprises
• Specific experiences in university-enterprise collaboration
• Various bodies (public and private) show interest in STI.
• Adequate bases of legal framework established


• Lack of coordination between institutions and lack of alignment
of STI policies


• Scarcity of resources allocated to STI
• There is no foresight survey of STI to establish clear priorities
• Lack of monitoring, evaluation and learning from STI policies


and programmes
• Weak research sector, dependent on higher education and


heavily weighted to the social sciences and humanities
• Weak education system, low quality, little orientation to scientific


and technological education
• Few links between research activities and production
• Limited access to financial resources for STI (lack of seed and


venture capital, limited public funds)
• Weak national quality system


OPPORTUNITIES THREATS


• Development of road and air infrastructure
• Development of telecommunications, especially mobile
• Development programmes: port of La Unión, Fomilenio etc.
• Diversified productive activities
• Open trade: opportunities to increase technological capacity,


purchase of capital goods, access to new technologies,
incentives to innovation


• Foreign investment and low rates of inflation.
• Support from international cooperation
• Salvadorians abroad
• International and regional cooperation in STI


• Scarcity of available public resources
• Heterogeneity of enterprises. Broad micro and small enterprise


sector with low productivity
• Commercial and consumerist culture
• International competition. Without greater capacity to absorb


technology, among other factors, Salvadorian companies will
have difficulties


• Weaknesses of public institutions
• Cost and fragility in the face of criminality, natural disasters and


external shocks
• Macro-economic imbalances: low levels of investment and


saving, facility of fiscal accounts


Source: UNCTAD.


and continuous guidelines. The heterogeneous
nature of business, where there is a large micro and
small enterprise sector with low productivity, will
also determine the objectives which the country can
achieve in STI. The consumption culture acts as a
disincentive to productive investment, and the rise in
international competition, without greater capacity for
technological absorption, among other factors, will
cause difficulties to Salvadorian companies. Lastly,
the cost of criminality, natural disasters and external
shocks (such as the sharp increases in the price of
oil or other commodities or drastic reductions in
remittances) and the country’s fragility in the face of
these phenomena, should not be overlooked.


Based on the foregoing diagnostic, a series of
recommendations are suggested focusing on five
major pillars:


1. Establish an institutional and
administrative, human and financial
framework able to lead and
coordinate the development of STI in
El Salvador


Establish a governing body for science, technology and
innovation with the responsibility of defining the major
strategic lines in STI, integrating STI in the national
development strategy and monitoring and evaluation
of policies. This would include coordination of efforts
to collect information on STI and the management of
foresight activities. By its nature, this governing body
should be positioned at a hierarchical level much
higher than currently occupied by CoNACyT.


This body must be given the authority, leadership
and resources necessary to carry out its mission.




114 Science, Technology and Innovation Policy Review - El Salvador


Consequently, it is proposed that it should be headed
by the President of the Republic, and composed of
the ministers of Economy, Education and other
ministries of particular relevance (Agriculture and
Livestock, Health), as well as high-level experienced
representatives of the academic, productive and
financial sectors. given the cross-cutting nature of
this body, it would be logical for its secretariat to be
included as part of the Technical Secretariat of the
Presidency.


In addition, the implementation of instruments, the
development of regulations and application of national
policy should be in the hands of the respective
ministries. given the limited volume of funds, and
in order to ensure greater proximity between the
design of instruments and the beneficiaries, it is
considered that, for the time being, management of
STI funds should best be decentralized. However, it
will be essential for the governing body for science,
technology and innovation to play a major role in the
management and monitoring of these funds.


2. Draw up a combination of STI
policies and programmes which,
linked to economic and education
policy, will strengthen general STI
capacities in El Salvador and the
development of STI in a selected
number of sectors and technologies


Based on the technological foresight survey and a
process of consultation with the various key actors,
identify 3 or 4 priority sectors and strategic technologies
on which to focus active policies to strengthen
technological capacity and innovation.


Establish a short-term National Science, Technology and
Innovation Plan, with specific and measurable objec-
tives, clearly identified responsibilities and resources,
and subject to a control system.


Progressively and constantly increase public investment
in STI, encouraging investment in the development of
Salvadorian human capital, collaboration activities,
technological support services for small and medium-
sized enterprises, the development of STI infrastructure
and the national quality system.


Foster private investment in R&D and innovation by,
among other things:
- establishing incentives (e.g. tax incentives)
- strengthening competitive funds for R&D and inno-


vation projects proposed by private investors
- ensuring that the reform of the national development


bank includes the establishment in the short term
of a seed and venture capital programme. This
programme will require the development of capacities
for venture capital management.


Promote sectoral and regional systems of innovation:
- promote the development of a system of agricultural


and agro-industrial innovation, based on the recom-
mendations made for this sector


- establish a series of actions to promote the develop-
ment of one or two regional systems of innovation.
The principal objective of this programme would be
to promote cooperation between regional agents
and establish framework conditions to allow such
cooperation.


Also develop a science, technology and innovation
information system which allows the design, monitoring
and evaluation of STI policies. This would include:
- carrying out regular innovation surveys
- carrying out regular surveys of access to and use of


information and communication technologies by the
country’s enterprises


- collecting information on investment in R&D outside
the higher education sector,


- establishing mechanisms for monitoring and evalua-
tion of the various STI policies and programmes


- establishing an STI observatory with the objective of
directing and disseminating the results of monitoring
and evaluation of STI policies.


3. Invest in the development of
Salvadorian human capital


Strengthen the national education system in order to
ensure adequate quality and orientation, including:
- Constantly and progressively increasing public


expenditure on education, encouraging investment
in infrastructure and improvements in the quality of
education.


- Based on an evaluation and a wide consultation
process, develop a national strategy for higher
education.


- Establish a set of actions to increase the quality
of education provision. Promote the accreditation
and certification of educational institutions and pro-
grammes. Strengthen quality control of Salvadorian
education, steadily raising minimum quality stan-
dards.




115
Chapter VI: CoNCLUSIoNS AND RECommENDATIoNS. A RoAD mAP FoR STRENgTHENINg


THE SySTEm oF INNovATIoN oF EL SALvADoR


- Strengthen teaching of mathematics and the natural
sciences by reformulating study programmes and
strengthening teacher training in these areas.


Establish a set of programmes to facilitate the provision
of and access to high quality postgraduate education, in
particular in the priority science and technology areas.
Consider, among other things:
- Significantly increasing the financing allocated to


high quality postgraduate studies, in particular in the
areas defined as priorities.


- Explore models which involve companies in the
financing of scholarships for students working on
subjects of interest to those companies.


- Strengthen bilateral cooperation with research
centres and postgraduate training centres, in order
to increase the number of Salvadorian postgraduate
students in programmes in various countries and
the participation of international experts in training
courses held in El Salvador.


Based on a review of the activities of INSAFORP and in
consultation with the private sector, establish a series
of actions to strengthen the programme management
and update the training offered. It would involve
strengthening the content and quality of training in
science, technology and innovation. Among other
things, establish programmes which meet the training
needs identified in the 3 or 4 priority strategic areas.


Establish a programme for repatriating and/or taking
advantage of Salvadorian talent abroad.


4. Strengthen entrepreneurial
innovation


Develop a series of instruments to encourage the
acquisition, adoption, dissemination and development
of technology in Salvadorian enterprises, including:


Strengthening programmes of innovation and tech-
nology transfer for SmEs, providing them with the
necessary financial resources: firstly, by increasing
the channelling of financial resources for innovation
through the support bodies which have promoted it
effectively, and, secondly, by putting into practice the
proposed development of sectoral technology cen-
tres1. Ensure that they are closely linked to productive
activities and promote the design and development
of activities with the participation of knowledge gener-
ating bodies (universities, specialized institutes, and
research centres).


Develop technological intelligence capacities.


Support the development of enterprise incubators,
especially technology-based companies, establishing
an incubation fund and promoting the establishment
of enterprise incubators.


Facilitate the development of venture and seed capital
in El Salvador, through institutional reforms which
establish the necessary legal and organizational
framework, and through financial contributions.


Include the development of technological capacities
in the relevant national development programmes, such
as FomILENIo or the management of the port of La
Unión. Establish a working group made up of local
actors, evaluate the capacities required and, through
a process of consultation, establish a programme
of action to strengthen technological capacities and
support technology transfer.


Establish a programme of promotion and training in
the management of intellectual property, for example in
universities and research centres. In the long term, the
establishment of a separate body for the management
of intellectual property could be envisaged.


Promote collaboration between universities, technological
and specialized institutes and companies, as well as
technology transfer, promoting the role of the university
and institutes both in the development of technology
and scientific knowledge, and its transfer and
application to the productive sectors. For example:


- Stimulate joint development programmes between
universities and companies, including a review of
possible obstacles of a regulatory character.


- Include private sector participation in the design of
STI policies, consulting entrepreneurs and represen-
tatives of industry associations.


- Establish an education and training programme on
management and transfer of technology in higher
education institutions.


- Stimulate private sector participation in the formula-
tion of study plans in universities, technological and
specialized institutes and in INSAFoRP work pro-
grammes.


Strengthen the set of policies aimed at promoting struc-
tural transformation and productive development (di-
versification of exports, strengthening of productive
chains, development of clusters and promotion of
a national quality system), ensuring that one of their
cornerstones is the development of technological and
innovation capacities.




116 Science, Technology and Innovation Policy Review - El Salvador


5. Strengthen research capacities in El
Salvador


Establish 4 or 5 research fellowships in the priority
sectors, and provide them with the necessary financial
resources.


Develop a mechanism for accreditation of the country’s
researchers which recognizes the work of those who
distinguish themselves in basic and applied research,
and development and transfer of technology.


Based on a national evaluation of the research
infrastructure, and consistent with the priority STI areas
identified, draw up a plan to strengthen and expand
the STI infrastructure at national level, including the
public and private sector. The plan would favour
the collaboration, complementarity and a joint
commitment of the various users and promoters
(central government, various higher education
institutions (public and private), productive sector and
international cooperation).


B. RoAd mAP foR ThE
STREngThEnIng of ThE
SySTEm of InnovATIon


Based on the above recommendations, Figure 1 shows
a possible road map, indicating the factors and actions
which are planned or in progress, and those which
could be implemented, to guide the strengthening of
the innovation system of El Salvador.


The road map classifies actions in accordance with
the specific functions of the system. It differentiates
between actions already contemplated and new
proposals, suggests whether their implementation
should be contemplated in the short, medium or long
term, and includes a series of influencing relationships.
For example, under the foresight function, it is
suggested that a foresight STI survey should be carried
out and development areas prioritized. These actions
directly influence the increased budget allocated to
R&D and innovation, the creation of public research
centres, the upgrading of the capacities of producers
and companies, improvement of the enterprises’
capacities for innovation, and the strengthening
of human resources and research infrastructure in
the higher education sector. Similarly, the setting of
priorities leads to the review, adjustment and design of
policy instruments, which in turn influences the budget


allocated to R&D and innovation, and consequently
also impacts on the instruments which are directed
at companies and the bodies which generate and
disseminate knowledge.


This road map must be cemented, firstly, by
commitment at the highest level to support the
putting into practice a series of strategic actions and,
secondly, by broad dialogue with all the key actors.


From the analysis carried out and this road map, it can
be seen that the principal starting points for strength-
ening the Salvadorian NSI are the establishment of
a governing body for STI, the conduct of a foresight
technological survey and the establishment of priority
development areas. These activities, essential to be
able to establish priorities and design effective instru-
ments, may require some time. In turn, many actors
are impatient to see more results from innovation and/
or are discouraged by the perception that the policies
and programmes implemented have had little effect.
In order not to discourage these actors, the govern-
ment of El Salvador can demonstrate its commitment
to STI, as well as by launching the above processes,
by determined support through a series of actions
which can yield short-term results. These can then be
adjusted based on the results of the foresight survey.
Some of these short-term actions would include: in-
creases in STI funding for existing successful mecha-
nisms, such as, for example, the FoEX-FoNDEPRo
funds destined for co-financing innovation activities;
continuation of assistance for successful independent
support programmes and organizations (FIAgRo,
PRoinnova); the establishment of funds for postgrad-
uate scholarships; and strengthening of consultation
between the public, private and academic sectors
(which can take the form of sectoral cells).


The road map outlined here requires significant efforts
and resources which may currently be available in
limited measure in the country. In this regard, UNCTAD
and ECLAC are at the disposal of the government
of El Salvador, to the extent that resources are
available, to continue to support the development of
these proposals through technical guidance on the
design of specific instruments, and training through
the UNCTAD and ECLAC programmes in specific
areas. In addition, UNCTAD and ECLAC can support
participatory processes of dialogue and sharing of
experiences in the area of science, technology and
innovation policies, with the objective of building
capacity in these policies and learning best practice
in this sphere.




117
Chapter VI: CoNCLUSIoNS AND RECommENDATIoNS. A RoAD mAP FoR STRENgTHENINg


THE SySTEm oF INNovATIoN oF EL SALvADoR


Figure 1. Road map for the strengthening of the system of innovation of El Salvador


Develop STI
capacities


Improve STI indicators


Direction
and cohesion


Maintain the favourable macro-economic environment


Create a supra-ministerial body


Foresight


Carry out foresight STI
survey and prioritize
development areas


Promote regional systems of innovation


Review and adjust policy
instruments and design new ones


Gradual increase in R&D and innovation budget


Development
bank


Articulated
actions


of ministries


Alignment
of existing
instruments


Launch
of new


instruments


Create public
S&T


research centres


Spin-off
companies


Intelligent
regions


Update training of producers
and companies


Innovative
companies


Strengthen research
infrastructure


Develop capacities in
technology transfer and managment


Spin-off
companies


Entrepreneurial
higher education
institutions


Strengthen primary and secondary eduction


SHORT TERM MEDIUM TERM LONG TERM


New factor Existing or
planned factor Goal


Management
and control


Develop monitoring and
evaluation capacities


Road
Map


to NSI of
El Salvador


Priorities


Priorities Priorities


Create capacities
for management


and transfer
of technology


Regulation


Execution Strengthen
higher


education


Improve culture of benefits
of intellectual property


Improve the national quality system


Create a separate
body to manage


intellectual property


Create competitive
technology


intelligence capacities


Develop innovation capacity
in enterprises Improve technology management capacities


of companies


Seed and venture
capital


Source: UNCTAD.




118 Science, Technology and Innovation Policy Review - El Salvador




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Annexes




126 Science, Technology and Innovation Policy Review - El Salvador


Table A.1. National STI policy of El Salvador, 2006. Areas of knowledge for scientific and technological development
and innovation2


Area of knowledge Detailed description


Biotechnology Management of regulatory and legislative framework / Elaboration of policy lines / Scientific and technological
research management / Financial resources management and project monitoring / management of mechanisms
for identifying, monitoring and assessment of risks / Technical expertise in risk analysis of the scientific aspects
/ Exchange of information and data management including participation in BCH/Technology transfer relating to
biosafety / Physiological studies of in vitro cultivation / Propagation and improvement of species / Molecular
biology / Biochemistry / Genetics / Biotechnology used to generate foods / Food technology and food security.


Materials science Characterization of materials / Identification of materials / Corrosion studies / Properties of materials /
Application to the manufacture of new materials.


Education Equality in education / Teacher training / Repetition and abandonment of classes / Quality of education /
Distance learning.


Energy Biofuels and renewable sources / Geothermal / Small hydro-electric power stations / Unconventional energy
sources.


Aerospace engineering
and technology


Aircraft assembly / Aircraft maintenance / Aerospace materials / Aerospace engineering.


Manufacturing Design and manufacture of integrated circuits and devices / Computer Assisted Design / Technology transfer for
SME sectors / Metrology services / Waste treatment / Information management / Automation and electronics /
Metallic and non-metallic materials technology / Materials recycling / Characterization of materials / Chemical
synthesis and modification of materials / Marketing and packaging / Textiles and clothing / Electronic commerce.


Environment and
natural resources


Preservation of the environment, forests and water / Biodiversity and biobusiness / Cleaner production
technologies / Environmental pollution / Solid waste management / Waste water treatment plants / Drinking
water processing / Extraction, maintenance, use and distribution of water resources.


Nanotechnology Nanostructured materials / Nanomedicine (release of drugs and DNA) / Nanobiotechnology / Nanoparticle
processes / Nanomanufacturing processes / Nanoengineering (nanoprobes, power and energy, clean water) /
Nano health and biosafety.


Land management
and town planning


Urban environment / Land planning / Participatory municipal government / Urban landscape / Town planning /
Human settlement, housing and services / Mobility and urban transport / Urban poverty / Urban projects.


Fisheries and
agriculture


Fish-farming / Marine biology / Cultivation of molluscs / Cultivation of crustaceans / Coastal management /
Sustainable development / Marine resources / Tropical mushrooms / Honey and derivatives / Integrated disease
management / Integrated farming for sustainable rural development / Sugar cane cultivation and processing /
Coffee cultivation and processing / Sustainable agriculture and agro-industry / Ecotourism.


Geological hazards Seismology / Earthquake resistant construction / Housing / Landslides / Floods.


Health Health technologies (bioengineering and biotechnology / Health promotion / New emergent and re-emergent
diseases / Environmental rehabilitation.


Information and
communication
technologies


Software development / Simulation / Geographical information / Design and development of interactive
systems / Management of computer and communications resources / Database management / Management of
computer networks and peripherals / Systems integration / Remote design and development of applications and
services / Wireless communication technologies / Multimedia integration / Development of software for devices
(firmware) / Artificial intelligence.


2 CONACYT, 2006.


AnnEx A. nATIonAl SCIEnCE, TEChnology And
InnovATIon PolICIES




127annexeS


Box A.1. Principal lines of the Five-Year Development Plan relating to STI


The goals of the five-year plan, directly or indirectly associated with science, technology and innovation include:
• Achieve an average real rate of growth of Gross Domestic Product of 4.0 per cent by the end of the period;
• Generate at least 250,000 new decent, temporary and permanent, jobs, by implementing public investment projects;
• Increase exports of goods and services by at least 20 per cent by the end of the fiver-year period; and,
• The strategic policies, which comprise the following:


1) Strategic social policies


a) Education.


i) Eight strategic action lines have been identified: a) fair access to and remaining in the education system; b)
relevant curriculum and significant learning; c) raising the status and professional development of teachers and head
teachers; d) strengthening institutional and curriculum management of education centres; e) permanent training for
the young and adult population; f) research, science and technology integrated in education; g) strengthening of
higher education; and (h) training for work.


2) Financial system to promote development
a) The Financial system to promote development will be formed from the Agricultural Development Bank, the mortgage


Bank and the multisectoral Investment Bank. The latter will become the National Development Bank of El Salvador.


3) Productive Development Strategy
a) Coordination of government resources and creation of financing models suited to innovation, strengthening business


management (according to the individual characteristics of producers and entrepreneurs) and differentiated
productive targets (depending on local aims and potential).


4) Macro-economic and sectoral strategies


a) Fiscal.


b) Export promotion.


i) Key processes: a) strengthening state institutional support for export sectors; b) incorporation of innovation
and technology transfer processes in the export sector; c) generation of decent jobs in the export sector; d)
stimulation of micro, small and medium-sized export companies by the creation of productive chains, business
partnerships and associative activities; e) taking advantage of free trade agreements, strengthening of the Central
American Common market and establishment of new trade relations with emerging countries; and f) establishing
the foundations for applying a systemic approach to the promotion and internationalization of strategic sectors in
countries and niche markets in which there are shown to be comparative advantages.


c) Energy.


d) Environment.


e) Agriculture.


i) Programmes: a) creation of a supply system to ensure food security; b) articulation of the system of technological
innovation with public-private participation for research, adaptation, validation and transfer of new processes and
products which will increase agricultural productivity and profitability; c) strengthening of the system of market
information and intelligence; d) recovery of national livestock farming and fishing; e) encouraging the formation
of new centres of intensive fruit and vegetable production; f) renovation of the coffee stock; g) commercial and
sustainable forestry management; h) revitalization of leadership and organization of agricultural production
(including diversification) and decentralization of the educational provision of the National School of Agriculture to
train new local technical agents; i) land registration; j) modernization and decentralization of ministry of Agriculture
and Livestock services; k) expansion and modernization of the area of irrigable land; l) reduction of environmental
hazards in agriculture; m) systems to ensure healthy, safe and traceable agri-food products; n) reactivation and
modernization of fishing and fish-farming.


f) Tourism.


5) Public investment
a) Investment is grouped in the priority programmes and projects shown in Figure 3 in Chapter II. The total costs of


these and the financing gap is shown in Table 2 in Chapter II.




128 Science, Technology and Innovation Policy Review - El Salvador


Table A.2. The National Research Agenda and its links to the Five-Year Development Plan (FDP)


Strategic areas of the
FDP and its priority
programmes


Strategic research
areas corresponding
to the FDP


Research subjects in which there are
strengths


Possible members of scientific and
technological development centres


EQUITY, SOCIAL INCLUSION AND POVERTY REDUCTION


National Integrated
Health System


Health - Health technologies
- New and re-emergent diseases
- Environmental rehabilitation
- Health systems and policies
- Economy and health
- Food and nutrition
- Social health problems


USAM, MSPAS, CENSALUD, UES,
UJMD, UEES, UCA, UNSSA, UNASA,
UAB, IEPROES Santa Ana, IEPROPES
San Miguel, Santa Ana National
Hospital, Rosales National Hospital.


Education Equity in education - Education of women for the
development of micro-enterprises


- Learning without fear
- Inclusive education
- Infant education
- Education in rural areas
- Education in citizens’ participation
- Migration, family and education
- Education in human rights


UES, C.E. Rep de Guatemala,
National Sarvelio Navarrete Institute,
UTLA, UMA, USO, UCA, UPAN, Plan
International


Quality of education - Repetition and school abandonment
- Relevance (education and


development)
- Education for the acquisition of


knowledge, capacities, skills and
attitudes for life.


- Scientific and technological research
- Educational research
- Teacher training
- Learning problems
- Education indicators
- Development of critical thought in


higher education
- Education for prevention of natural


or manmade disasters from a risk
management perspective


UMA, USO, C.E Rep Guatemala, UTEC,
Salvadorian Cultural Centre, UES,
National Sarvelio Navarrete Institute,
UTLA, UEES, UPAN, UCA, Plan
International, USAM, UGB, UFG


External education - Distance learning
- On-line learning
- Implementation of information and


communication technologies for
access in rural areas


USO, C.E. Rep. Guatemala, UES, UFG,
National Sarvelio Navarrete Institute,
UGB, UCA, UPAN


Housing Housing and urban
development


- Social housing
- Development of new construction


technologies
- Anti-seismic engineering
- Geotechnical engineering
- Climatic housing
- Building standards
- Corrosion
- New building materials
- Sanitary infrastructure
- Urban environment
- Bioclimatic construction


UES, UTEC, UCA, FUNSALPRODESE,
UNICAES, UTLA, Usulután Technological
Institute, UDB, CICES, ITCHA




129annexeS


Strategic areas of the
FDP and its priority
programmes


Strategic research
areas corresponding
to the FDP


Research subjects in which there are
strengths


Possible members of scientific and
technological development centres


ECONOMIC REACTIVATION


Reactivation of
agriculture


Agro-industry - Agro-industrial development
- Manufacturing
- Productive chains
- Fruit industry
- Industrialization of medicinal plants


CENTA, ENA, UES, UJMD, UNICAES,
FUNSAL, UCA, USAM


Saltpans - Productive process for sea slt UJMD


Food security - Agricultural diversification Plan International, CENTA, ENA, UJMD,
UES, UNICAES, UTLA, Intermunicipal
Technical Unit, SNET, LABOTEX-UES


Food safety - Products of animal origin
- Analysis of toxins in fish products


UES, UCA, UES-ICMARES , LABOTOX-
UES


Sustainable agriculture - Environmentally friendly practices
- Conservation of phyto-genetic


resources
- Soil management
- Non-transgenic genetic improvement
- Domestic kitchen gardens
- Industrialized production and use of


organic fertilizer
- Biological pest control
- Agro-climatological studies


CENTA, UES, ENA, UNICAES, UEES,
UTLA, FUNDADESCA


Cultivation of aquatic
species


- Experimental cultivation of pargo in
small volumes of water


- Cultivation of molluscs
- Cultivation of native species


UES- ICMARES


Animal health - New and re-emergent diseases
- Diseases which affect fish-farming


UNICAES, UES- ICMARES


Basic social
infrastructure


Land planning - Urban settlements
- Geological research
- Regional development
- Local development
- Urban development
- Mobility and transport


UTLA, ASIA, UES- Institute Earth
Sciences, Geologists of the World,
UTEC, UCA


Micro, small and
medium-sized
enterprises (MSMEs)


Industry - Metal industry
- Construction
- Tourism
- Photovoltaic systems
- Improvement of processes for


manufacture of electrical components
- Logistical supply chain
- Control of gas emissions
- Manufacturing industry
- Production of biodiesel
- Software development


UCA, AVX Industria, ESEN, UTLA,
ITCHA, ITCA, UGB, FEPADE


Innovation and
technology


National System of
Innovation


- Technology parks Government institutions, research
centres


Table A.2. The National Research Agenda and its links to the Five-Year Development Plan (FDP) (cont.)




130 Science, Technology and Innovation Policy Review - El Salvador


Table A.2. The National Research Agenda and its links to the Five-Year Development Plan (FDP) (cont.)


Strategic areas of the
FDP and its priority
programmes


Strategic research
areas corresponding
to the FDP


Research subjects in which there are
strengths


Possible members of scientific and
technological development centres


SUSTAINABLE DEVELOPMENT


Energy sector Renewable energy - Photovoltaic energy
- Wind power
- Tidal energy
- Geothermal energy
- Biomass energy
- Biofuels (biodiesel)
- Development of devices
- New forms of energy use (nuclear and


dark)


UES, UTLA, CIC-UES, UJMD, UTEC-
FUCITEC, Interdisciplinary Modular
Faculty of UES Oriente, UCA


Energy efficiency - Technical standards
- Power generation
- Service quality of electricity systems


Specialize Franciscan E.S, UES,
CIC-UES, UDB, FUNDADESCA, SIGET,
ITCA-FEPADE, UCA


Electricity - High tension cables
- Electrical quality indicators


CIC-UES


Energy industry - Innovation in energy production CIC-UES


Energy quality - Quality of imported fuels UES, MINEC


Environmental and risk
management


Prevention and
management of
natural hazards


- Characterization of movement of
slopes


- Characterization of floods
- Monitoring of seismic activity
- Monitoring of volcanic activity
- Effect of natural events
- Social perception of risks
- Risk mapping
- Integration of energy plans


UES, Intermunicipal Technical Unit,
Geologists of the World, MARN, USAM,
UCA


Integral solid waste
management


- Integral waste management UTLA, UES, UCA


Environment - Water quality
- Environmental rehabilitation
- Degradation of the shore and coastal


ecosystem
- Study of inland waters
- Protection of turtles
- Legal aspects of territorial waters and


continental waters
- Evaluation of the impact of tourism


projects
- Ecology of the seabed and mangroves.
- Animal, fungal and vegetal biodiversity
- Inventory of vegetal germplasm
- Management of protected areas
- Management of social and


environmental conflicts
- Studies of acoustic, electro-magnetic


and chemical pollution
- Solid wastes
- Sedimentary processes, water


treatment


UES, UTLA, Plan International, UCA,
Intermunicipal Technical Unit, UNICAES,
MARN, ICMARES-UES, Santiago de la
frontera Education Centre, USAM, UGB,
UES-Química, SNET, ESFE, UDB, UES-
FMO, UFG


Climate change - Effects on health
- Biophysical study of drought
- El Niño phenomenon
- Incidence of atmospheric systems
- Climate characterization
- Impact of hurricanes
- Rain events
- Air quality


CIC- UES, UCA, UGB, LABOTEX UES,
MARN, SNET, USAM, UFG, UES Oriente




131annexeS


Strategic areas of the
FDP and its priority
programmes


Strategic research
areas corresponding
to the FDP


Research subjects in which there are
strengths


Possible members of scientific and
technological development centres


- Climate change models
- Effects of climate change
- Prevention and mitigation of the effects


of climate change
- Seasonal forecast


Hydro-geochemistry
of waters


- Subterranean rivers
- Lakes
- Seas


UES, UTLA


Natural resources - Germplasm banks
- Water resources


MAG, UES, SNET, UCA, ICMARES


CIVIL SECURITY


Prevention of violence
and crime


Violence - School
- Migration and family
- Childhood and communication media
- Drugs
- Violence in the home


Plan International, UEES, UPAN, UGB


SPECIAL ASPECTS OF DEVELOPMENT


Culture History - Cultural heritage
- Cultural assets
- Revival of the Náhuatl language
- Indian law


Plan International, UES, UTLA, UDB,
UFG, UTEC, CENICSH, ESFE/AGAPE,
UCA, National Library, UEES


Tourism Tourism - Tourist accommodation
- Local development
- Centres of tourist development
- Development of tourism products
- Ecotourism: design of productive


development models and plans
- Development of self-sustaining rural


tourism


UTEC, UTLA, UJMD, UAB, UPAN, UFG,
ITCHA, UAE, UCA


Table A.2. The National Research Agenda and its links to the Five-Year Development Plan (FDP) (cont.)




132 Science, Technology and Innovation Policy Review - El Salvador


Table A.3. Contents of the National Scientific and Technological Development Plan


Component Programmes Projects


Education and training National programme
of training in science,
technology and innovation


- Education abroad of persons in the higher education system with master’s
degree or doctorate in science and technology through scholarships


- Development and strengthening of master’s degree and doctorate studies in
science and technology in the country


- Promotion of university-enterprise-government cooperation in research
- Development of young researchers
- Mobilization of professionals qualified in science and technology at national


and international level


Promotion, dissemination
and popularization of
science and technology


- Science and technology for all (creation of museums, science and
technology prizes, science fairs, congresses, etc.)


- Strengthening of the infrastructure of science and technology laboratories in
primary and secondary schools


Continuing training of the
population in science and
technology


- Studies of the labour force and public (social) perception of science and
technology.


- Training in knowledge management
- Development of an entrepreneurial culture at all levels of the national


education system


Scientific and
technological
information


Establish a system of
basic indicators and
statistics for science,
technology and innovation


- Creation of a science, technology and innovation studies division.
- Development of three surveys on science, technology and innovation:


human resources in science and technology; determination of scientific and
technological capacities; and social perception of science and technology


- Articulation of natural networks of scientific and technological information
- Consultative forum


Transfer, innovation
and technological
development


Development and
strengthening of university-
enterprise-government
links


- Development of technology parks, technology-based enterprise incubators
- Management of technology and technological innovation in MSMEs
- Strengthening and monitoring of the National System of Innovation


Information and
communication
technologies (ICT)


Building a knowledge-
based society


- Strengthening of ICT at all levels of the education system, e-economy and
e-government


- Strengthening of distance learning programmes
- Massive incorporation of ICT in homes and the business sector
- Studies of the impact of ICT on Salvadorian society


Development of MSMEs in
the ICT sector


- Support for the creation and development of companies in the ICT sector.
- Support for ICT companies through their integration under the International


Services Act
- Incentivize the use of ICT in distance learning, electronic commerce,


multimedia production, telemedicine, etc.


Science and
technology for the
development of zones
or regions of the
country


Science and technology
as an instrument to
strengthen the processes
of decentralization and
local development


- Strengthen the innovative entrepreneurial fabric in the various regions of the
country


- Define strategic plans for scientific and technological development of the
various regions of the country


- Define academic education programmes adapted to the development needs
of geographical units


Infrastructure
of science and
technology


Upgrading and
modernization of the
country’s science and
technology infrastructure


- Articulation and modernization of the network of science and technology
laboratories in the country. Strengthen joint university-company-government
working groups


- Upgrade the stock of science and technology infrastructure in the country.
- Use of public and private science and technology infrastructure by the


country’s business sector


Financing of scientific
and technological
development and
innovation


Financing of science,
technology and innovation


- Creation and organization of a scientific and technological development and
innovation fund


- Strategy for the financing of scientific and technological development


Source: MINED, 2010b.




133annexeS


Table A.4. Integral Export Promotion Strategy


Strategic objectives Strategic areas Lines of action


Diversify and
consolidate destination
markets, prioritizing
and taking advantage of
opening of markets


Taking advantage of
priority markets/countries


- Identify priority markets


Identifying strategic
sectors/products to be
developed


- Collaboration between public and private bodies in identifying and selecting
strategic sectors and products


- Stimulate the development of 5 strategic sectors: i) Food agro-industry; ii)
Information and communication technologies; iii) Chemical pharmaceuticals;
iv) High-tech services; and v) Tourism


Negotiation, administration
and protection of trade
agreements


- Identification and proposal of new trade agreements
- Negotiation, administration and implementation of trade agreements
- Protection of commercial interests in accordance with agreements signed
- Strengthening of technical managers


Management of export
promotion


- Stimulate and consolidate the role of EXPORTA and its coordination with the
public and private sector.


- Establish continuing education and training programmes
- Intensive dissemination of services available to exporters through EXPORTA
- Establish mentoring and coaching programmes


International marketing:
country image


- Design a single country image strategy
- Strengthen coordination between EXPORTA, PROESA, MINEC, RREE, MITUR


and the private sector


Institutionalize
export promotion
mechanisms: focused,
accessible, integrated,
measurable over time
and share with the
private sector


Competitiveness in the
local market as a pre-
export phase


- Development of productive chains
- Establish programmes for the strengthening or development of suppliers
- Creation and publication of standards to encourage quality, innovation and


technology
- Work in a coordinated way with national systems of quality and innovation


Special financing for SMEs - Strengthen the various existing financial support instruments (FOEX/
FONDEPRO, among others) and/or create new support options


- Provide through the BMI a set of instruments or products which allow
exporters access to pre- and post-export guarantees and financing


Support for foreign trade
procedures


- Establish a Centre for Foreign Trade Procedures (CENTRACE)
- Create and inter-institutional team for the development of new procedures


and functioning of CENTRACE


Strategic diversification
of provision, with
significant added
value, which allows a
competitive presence in
the global market


National System of
Innovation (NSI)


- Creation of Sectoral Innovation Centres (5)
- Strengthen the INVENTA gateway
- Promote the culture of innovation
- Identify and strengthen resources or factors for innovation
- Platform to attract Salvadorian science professionals living abroad
- Define and make available long-term financing mechanisms
- Establishment of partnerships


National Quality System
(NQS)


- Integrate the work and progress in various public and private bodies in
relation to quality


- Create a national centre for productivity and quality
- Strengthen and/or develop the institutional basis
- Creation of 4 executing institutes relating to standards, technical


regulations, accreditation and metrology


Foreign Direct Investment - Strengthen the operative role of PROESA
- Define strategic sectors and countries
- Redefine and promote a country image
- Update laws, regulations and incentives for Foreign Direct Investment


“Salvadorian Bridge”
Platform


- Identify and contact Salvadorians abroad who work in companies involved
in the strategic sectors


- Draw up an inventory of Salvadorians abroad (PROESA)




134 Science, Technology and Innovation Policy Review - El Salvador


Table A.4. Integral Export Promotion Strategy (cont.)


Strategic objectives Strategic areas Lines of action


Develop an export,
innovation and
quality culture which
promotes capacities
and entrepreneurship,
aimed at effective
penetration of foreign
markets


Inter-institutional
coordination and impetus
to promote an export
culture


- Identify and develop a system which allows better access to training for
human resources


- Establish programmes tailored to companies
- Encourage the creation of a Master’s degree in Technology Management


Dissemination of the
export culture


- Encourage the dissemination of success stories and subjects related to
foreign trade, innovation and quality


- Organize training programmes for journalists
- Organize extension activities by public and private entities relating to export


processes, innovation and quality


Design structure for
high-level management,
coordination and
inter-institutional
control, strengthening
links between the
government, private
and academic sectors


Public institutionalization
for monitoring,
implementation and taking
of decisions on exports,
investment, innovation and
quality


- Create and implement a Ministerial Committee of Exports, Innovation and
Quality (CMEIIC)


- Elaborate mechanisms for the functioning of the CEMEIIC
- The CMEIIC will be responsible for stimulating actions to strengthen the


country’s business climate


Strengthening the links
between government and
the private sector


- Incorporation of members of the private sector in committees and/or boards
of relevant programmes or instruments


- Joint management of training programmes for representatives of
the private sector on trade negotiations and other disciplines which
strengthen their capacity as a trade association


- Jointly disseminate the programmes/instruments contemplated in the export
strategy


Note: The strategic areas and lines of action most relevant to STI are shown in bold.
Source: UNCTAD, based on MINEC (2010).




135annexeS


AnnEx B.
dEvEloPmEnT And
lImITATIonS of ThE
nATIonAl SySTEmS of
InnovATIon APPRoACh.
ThE ConCEPT of SySTEmS
In ThE TEChnologICAl
InnovATIon lITERATuRE


The origin of the use of the concept of systems
associated with innovation studies can be found in
the evolution of the concept of innovation itself. These
early associations between concepts of systems and
innovation, which began during the seventies in works
by various academics around Christopher Freeman
and the Science Policy Research Unit (SPRU)3,
implied the conceptualization of this phenomenon as
a non-linear process which involves the coordinated
participation of a wide range of actors.


The subsequent use of these concepts, up to the late
eighties and early nineties, appeared in three seminal
works which introduced the idea of national systems of
innovation4. It involved extending the idea of networks
of agents in the innovation process to include the role
played by institutions5. These original interpretations
did not lead to a unified concept of national system of
innovation,6 probably because the main proponents
belonged to different research traditions, in which the
common denominator was affinity with the ideas of
the economist Joseph Schumpeter.


The main objective of these original interpretations of
nationals innovation systems was to explain national
economic development patterns through the analysis
of the interactions between the actors and institutions
involved in innovation networks. Linked to this primary
objective, there was also an implicit, and sometimes
explicit, orientation towards the design of innovation
policies.7


Despite their leaning towards policies, none of the
original interpretations included an operative version
of the systems of innovation approach. This was es-
sentially developed by the oECD, which adopted the
concept in the early nineties (David and Foray, 1994;
oECD, 1992). From that stemmed what we may call
the general interpretation of the approach, which
means that specific national systems can be suffi-
ciently described by listing the principal components


(agents and institutions) involved in the processes of
innovation and the study of their most significant in-
teractions. The analysis of how these interactions give
form to successful systems of innovation is the basis
for identifying “best practices” and the fundamental
components. These then serve as a guide to institu-
tional and organizational learning in the international
environment. This general interpretation, refined in
various reports and studies8, is the one usually used
in studies of systems of innovation.


The current interpretation of systems of innovation is
not entirely consistent with the systems approach. For
example, the objectives of the approaches vary. The
original interpretation of national systems of innovation
leaned towards the identification of differences in
the innovative performance of different countries. In
particular, how different national institutions influenced
the success of systems of innovation. In contrast,
systems theory is based on the identification of
elements, functions, behaviours, etc. which are similar9


across different areas. This means that systems of any
kind operate according to the same basic principles.
Ideally, therefore, it should be possible to deduce the
principles applicable to particular systems from the
more general10.


moreover, the systems of innovation approach was
fundamentally based on a traditional definition of sys-
tems as entities composed of elements and interac-
tions, and does not address aspects concerning the
hierarchical structure of systems, treatment of the en-
vironment and analysis of the processes which occur
within the system.11 open systems theory replaced
this traditional concept with one in which the system is
distinguished from its environment (Checkland 1981;
Luhmann 1995; von Bertalanffy 1968). It introduced
two pairs of ideas which constitute the basis of sys-
tems thinking: emergence and hierarchy and com-
munication and control. In other words, new systems
emerge from the interaction between subsystems,
while the various hierarchies between the whole and
its components allow differentiation with respect to the
environment. These interactions require diverse com-
munication mechanisms whose function is to control
the system in its tendency to stabilization.


The application of the systems of innovation
framework also presents certain paradoxes. one
of them is the dual perspective of the concept
of system of innovation. on the one hand, it is a
reference framework to explain the reality. on the
other, it is also adopted as regulatory posture and




136 Science, Technology and Innovation Policy Review - El Salvador


the framework becomes a model of how the reality
should be organized. Thus, instead of being a faithful
representation of observed reality, it becomes one
which is filtered through a predetermined structure.
For example, undertaking innovation processes is a
desirable state for a company to be successful, but
in no way does it represent the only way in which that
company grows nor could it represent the state of all
companies.


In short, the concept of systems of innovation can
only be generalized as an analytical framework
which assumes the need for articulation (interaction)
between economic agents, but does not provide
elements to deal systematically with those agents.
In other words, it does not explain how those agents
organize themselves hierarchically to form emerging
systems of growing complexity.


Consequently, studies carried out within this framework
frequently describe supposed subsystems whose
interactions constitute national systems of innovation,
but they do not present details which would allow
evaluation of whether the agents actually constitute
such subsystems, for example a sufficiently mature and
developed industrial or research subsystem. In other
words, it is generally assumed that these subsystems
are given and it is only necessary to consider the
development of institutions, organizations, policy
instruments, etc. (through learning or replication
of international experience) which encourage the
interrelation of those subsystems. Naturally, this
perspective works fairly well in countries which, for
historical reasons, actually have such subsystems.
However, it would be pointless in countries where
those subsystems do not exists or are in a maturing
or consolidating phase.


AnnEx C.
REgIonAl SySTEmS of
InnovATIon (RSI)


This concept is usually understood as an interacting
set of public and private interests and formal
organizations and institutions which operate in
accordance with organizational and institutional rules
as well as relations which lead to the generation, use
and dissemination of knowledge (Doloreux 2004;
Doloreux and Parto 2005). The fundamental argument
is that this set of actors produces systemic effects


which stimulate enterprises within regions to develop
specific forms of capital derived from social relations,
regulations, values and interactions within the
community, which themselves strengthen capacities
for innovation and competitiveness.


The origin of the concept relies on two main bodies
of theory and research. The first of these is found
in the literature on innovation systems itself. The
second body of research corresponds to regional
studies whose approach is aimed at explaining
the socio-institutional environments within which
innovation emerges (malmberg and maskell 1997).
From a regional perspective, innovation is a localized
phenomenon in a local setting, and not a universal
process. Consequently, this literature deals both with
the role played by proximity (the benefits derived
from the advantages of localization and geographical
concentration) and the set of regional rules, standards
and conventions through which the process of
generation and dissemination of knowledge occurs
(Kirat and Lung, 1999). In other words, a regional
system of innovation is characterized by collaboration
in innovation activities between companies,
knowledge-generating organizations and the culture
and institutions which promote innovation, thus
allowing the system to evolve over time.


The concept of RSI has emerged in various countries
at times when public policies seek to focus on the
promotion of truly localized processes for generating
knowledge which ensure the competitiveness of
the regions. The main justification for conceiving
specific policies targeted within regional systems
is based on their greater capacity to concentrate
on the development of the capacities of companies
in terms of performance, as well as improving their
business environment. From this point of view, it is
of considerable importance to promote interactions
between the various actors who should have good
reasons for interacting, such as those between
companies, universities and research centres, or
between emerging companies and other more
developed ones (Cooke, 2001). on this basis, policy
strategies can also be directed to the development of
local comparative advantages, linked to the specific
resources of the regions concerned.




137annexeS


AnnEx d.
PATEnT AnAlySIS


1. Note on methodology
Two sources of information on patents are used:
initially, for purposes of comparison, data from the
Ibero-American Network of Science and Technology
Indicators (RICyT) were used,12 corresponding to
aggregate patenting patterns in Central America
and certain Latin American economies, from 2002 to
2008. Secondly, to have additional information to that
provided by aggregate indicators which are limited to
the number of patents by resident and non-resident, a
search was made of the Espacenet database of Latin
American patents,13 of all patents registered in which
one of the inventors was resident in El Salvador.14 132
patents between 1993 and 2010 were located. The
results of the analysis are presented below.


2. Results
very few patents were registered by residents in El
Salvador in the period studies, with an average of


less than 8 patents per year in the Espacenet records
and 15 in those of RICyT. Despite an upward trend,
there was a decline between 2005 and 2009 (Figures
D.3 and D.4). Using the RICyT data as a basis for
comparison, this pattern of patenting intensity is very
similar in the Central American region, where, in fact,
El Salvador is the best placed, with a higher annual
average of patents granted to residents and a better
ratio in this respect to the total (Figure D.1) and in
relation to non-resident patents (Figure D.2). It also
shows a coefficient of invention (patents applied for
by residents in relation to the population) only below
that of Costa Rica (Figure D.3).


Figure D.1 shows an indicator close to what RICyT calls
the self-sufficiency rate (resident patent applications
to total patents applied for) and El Salvador’s position
is the best of the countries shown (because it is closer
to the diagonal line which starts from the origin of
the graph). Similarly, Figure D.2 shows an indicator
close to that indicated by RICyT, dependency rate
(non-resident patent applications to applications by
residents) and, again, El Salvador’s position is the
best among the Central American countries.


Figure D.1. Ratio of the annual average patents granted
to residents and total patents granted
in Central American countries and selected
Latin American countries, 2000-2008
(logarithmic scale)


10,000


1,000


100


10


1
1 10 100 1,000 10,000


To
ta


l p
at


en
ts


g
ra


nt
ed


Residents' patents


Mexico


Brazil


Argentina


Chile


Panama
GuatemalaHonduras*
Nicaragua*


El Salvador


Costa Rica*


Note: the asterisks indicate that the data series are incomplete.
Source: UNCTAD, based on RICYT data.


Figure D.2. Ratio of the average patents granted
annually to non-residents and residents
in Central American countries and selected
Latin American countries, 2000-2008
(logarithmic scale)


10,000


1,000


100


10


1
1 10 100 1,000 10,000


Re
si


de
nt


Non-resident


Mexico


Latin America
Brazil


Argentina


Chile


Panama
Guatemala*


Honduras*


Nicaragua*


El Salvador


Costa Rica*


Note: the asterisks indicate that the data series are incomplete.
Source: UNCTAD, based on RICYT data.




138 Science, Technology and Innovation Policy Review - El Salvador


Figure D.3. Trends in coefficients of invention of Central American countries and certain Latin American economies, 1999-2008


Brazil
Chile


Argentina
Latin America and Caribbean El Salvador


Mexico
Guatemala


Honduras
Nicaragua


Costa Rica


-0.5


0.0


0.5


1.0


1.5


2.0


2.5


3.0


3.5


4.0


4.5


1999 2000 2001 2002 2003 2004 2005 2006 2007 2008


Note: The coefficient of invention is the number of patents applied for by residents per 100,000 inhabitants.
Source: UNCTAD, based on RICYT data.


Figure D.4. Number of patents with at least one inventor resident in El Salvador, 1993-2010


Nu
m


be
r o


f p
at


en
ts


0


2


4


6


8


10


12


14


1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2007 2008 2009 2010


Source: UNCTAD, based on Espacenet data.


Although this comparative information is encouraging,
it should not be forgotten that the intensity of patenting
in a country is multifactorial and reflects, among other
things, the size of the economy, patterns of industrial
specialization, the size of the domestic market, its
international trade, exports, etc. When we take all
these factors into account, we see that although El
Salvador’s indicators are balanced and positive, they
also show a small economy, with a small domestic
market and little export capacity for high-technology
products (see also Figure 7 in Chapter II).


For more detailed information, Figures D.5 and D.6
show that although inventors who apply for patents live
in El Salvador, the owners of the rights are essentially
foreign companies. In addition, to provide some
useful information on the productive specialisation of
the country, Tables D.1 to D.5 show the principal areas
in which patents are obtained, the companies which
hold the greatest number of patents and the countries
to which they belong (two periods have also been
distinguished: a general one, from 1993 to 2010, and
another covering only the last ten years).




139annexeS


Figure D.5. Distribution of patents by country of
residence of primary inventor, 1993-2010


1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2007
2008
2009
2010


10 106 68 84 42 20


Ye
ar


Number of patents


Country of residence of inventor


OtherEl Salvador


Source: UNCTAD, based on Espacenet data.


Figure D.6. Distribution of patents by country of
residence of primary owner, 1993-2010


1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2007
2008
2009
2010


15 10 5 151050


Ye
ar


Number of patents


Country of residence of inventor


OtherEl Salvador


Source: UNCTAD, based on Espacenet data.


Class N° of patents Percentage of total


Medical or veterinary science 18 13.64
Basic electric elements 6 4.55
Combustion engines 6 4.55
Electric communication technique 6 4.55
Foods or foodstuffs 6 4.55
Agriculture 5 3.79
Combustion apparatus 5 3.79
Conveying 5 3.79
Furniture 5 3.79
Building 4 3.03
Computing 4 3.03
Generation, conversion, or distribution of electric power 4 3.03
Organic chemistry 4 3.03
Engineering elements or units 3 2.27
Information storage 3 2.27
Organic macromolecular compounds 3 2.27
Vehicles in general 3 2.27
Animal or vegetable oils 2 1.52
Biochemistry 2 1.52
Hand cutting tools 2 1.52
Hand or travelling articles 2 1.52
Hoisting 2 1.52
Machine tools 2 1.52
Machines or engines in general 2 1.52
Physical or chemical processes 2 1.52
Working of plastics 2 1.52


Source: UNCTAD, based on Espacenet data.


Table D.1. Principal classes of patents registered (international classification), 1993–2010




140 Science, Technology and Innovation Policy Review - El Salvador


Country of patent holder N° of patents Percentage of total


Sweden 38 28.79


United States of América 26 19.70


El Salvador 22 16.67


Switzerland 6 4.55


Germany 5 3.79


Finland 4 3.03


Japan 2 1.52


The Netherlands 2 1.52


Source: UNCTAD, based on Espacenet data.


Table D.2. Principal countries of origin of holders of patents registered, 1993–2010


Patent holder (company or person) N° of patents Percentage of total


Asea Brown Boveri 4 3.03


Ericsson Telefon ab l m 4 3.03


IBM 4 3.03


Nestlé SA 3 2.27


ABB ab 2 1.52


Borealis Tech oy 2 1.52


Campos Marcia José Luis Arturo 2 1.52


Distribuidora Shell de El Salvador 2 1.52


Electrolux res & innovation 2 1.52


Ford Global Tech Inc 2 1.52


Manufacturas Humberto Bukele e 2 1.52


Motorola Inc 2 1.52


Químicas Lasser de El Salvador 2 1.52


Texas Instruments Inc 2 1.52


Vásquez Valiente Maria Eugenia 2 1.52


Volvo Car Corp 2 1.52


Source: UNCTAD, based on Espacenet data.


Table D.3. Principal holders of patents registered, 1993–2010




141annexeS


To
ta


l


Er
ic


ss
on


T
el


ef
on


A
b


L
M


IB
M


Ne
st



S


A


AB
B


ab


Bo
re


al
is


T
ec


h
Oy


Ca
m


po
s


M
ar


ci
a


Jo
se


L
ui


s


Fo
rd


G
lo


ba
l T


ec
h


In
c


M
an


uf
ac


tu
ra


s
Hu


m
be


rt
o


Bu
ke


le
E


Nu
ne


z
Su


ar
ez


R
en


e
M


au
ric


Oe
st


re
ic


h
Ge


rd


Te
xa


s
In


st
ru


m
en


ts
In


c


Un
de


rp
ho


ne
A


b


Va
sq


ue
z


Va
lie


nt
e


M
ar


ia
E


Vo
lv


o
Ca


r C
or


p


Total 79 5 3 3 2 2 2 2 2 2 2 2 2 2 2


Medical or veterinary science 8 1


Combustion engines 6 1 2


Electric communication
technique 5 3


Foods or foodstuffs 5 3


Agriculture 4


Conveying 4 2


Organic chemistry 4 2


Basic electric elements 3 1 1 1


Computing 3 2


Furniture 3 1


Biochemistry 2


Building 2


Combustion apparatus 2 2


Information storage 2 2


Machines or engines in general 2 1 1


Organic macromolecular
compounds 2 2


*Note: the thresholds for classes and patent holders were set at two patents.
Source: UNCTAD, based on Espacenet data.


Table D.4. Principal* classes of patents and principal* patent holders, 2001–2010


To
ta


l


Er
ic


ss
on


T
el


ef
on


A
b


L
M


IB
M


Ne
st



S


A


AB
B


ab


Bo
re


al
is


T
ec


h
Oy


Ca
m


po
s


M
ar


ci
a


Jo
se


L
ui


s


Fo
rd


G
lo


ba
l T


ec
h


In
c


M
an


uf
ac


tu
ra


s
Hu


m
be


rt
o


Bu
ke


le
E


Nu
ne


z
Su


ar
ez


R
en


e
M


au
ric


Oe
st


re
ic


h
Ge


rd


Te
xa


s
In


st
ru


m
en


ts
In


c


Un
de


rp
ho


ne
A


b


Va
sq


ue
z


Va
lie


nt
e


M
ar


ia
E


Vo
lv


o
Ca


r C
or


p




142 Science, Technology and Innovation Policy Review - El Salvador


Ericsson Telefon Ab L M


IBM


Nestlé SA


ABB Ab


Borealis Tech Oy


Campos Marcia Jose Luis


Ford Global Tech Inc


Manufacturas Humberto Bukele E


Nunez Suarez Rene Mauric


Oestreich Gerd


Texas Instruments Inc


Underphone Ab


Vasquez Valiente Maria E


Volvo Car Corp


Basf Se


Ct De Cooperation Intern


Currency Venture Sweden


Dsm Nv


Fitness Conection SA De


Ford Global Tech Llc


Inclan Robredo Margarita


Invacare Internat Sarl


Jean Charles Inc


Lopez S A De C V Lab


Manufacturas Humberto To


Mazariego Pena Eustaquio


Meardi Guevara Angel


Monterrosa Amaya Saul An


Mygarb Inc


Nokia Corp


Nokia Mobile Phones Ltd


P & B Res Ab


Pharmacia Ab


Posada Pedro


Ruffatti Paz Salvador Ro


Sca Hygiene Products Hol


Syngenta Participations


Tapachulteca Ii


Univ Liege


Ventura Hernandez Jose D


Vertex Pharma


Volvo Penta Ab


Wolff Walsrode Ag


M
ed


ic
al


or
v


et
er


i-
na


ry
s


ci
en


ce
1


1
1


1
1


1
1


1


Co
m


bu
st


io
n


en
gi


ne
s


1
2


1
1


1


El
ec


tri
c


co
m


m
un


i-
ca


tio
n


te
ch


s
3


1
1


Fo
od


s
or


fo
od


-
st


uf
fs


3
1


1


Ag
ric


ul
tu


re
1


1
1


1


Co
nv


ey
in


g
2


1
1


Or
ga


ni
c


ch
em


ist
ry


2
1


1


Ba
sic


e
lec


tri
c


ele
-


m
en


ts
1


1
1


Co
m


pu
tin


g
2


1


Fu
rn


itu
re


1
1


1


Bi
oc


he
m


ist
ry


1
1


Bu
ild


in
g


1
1


Co
m


bu
st


io
n


ap
-


pa
ra


tu
s


2


In
fo


rm
at


io
n


st
or


-
ag


e
2


M
ac


hi
ne


s
or


e
n-


gi
ne


s
in


g
en


er
al


1
1


Or
ga


ni
c


m
ac


ro
m


o-
lec


ul
ar


c
om


p
2


*N
ot


e:
th


e
th


re
sh


ol
ds


fo
r c


la
ss


es
w


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e


se
t a


t t
w


o
pa


te
nt


s
an


d
th


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ho


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er


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of


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ac


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ss


es
.


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ur


ce
: U


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as


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at
a.


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a


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en


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ol


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rs


, 2
00


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20


10




143annexeS


Figure E.1. Sources of financing and budget allocation


UASA UCA UDB UTEC


0% 20% 40% 60% 80% 100%


Bu
dg


et
a


llo
ca


tio
n


So
ur


ce
s


of
fi


na
nc


in
g Fees


Technological services


R&D


Other


Education


Technological services


R&D


Other


Source: UNCTAD, based on data collected by DIDT.


Figure E.2. Proportion of academic grades among teaching staff


Doctor of Philosophy (PhD)


Doctor of Medicine
or Odontology


Doctor


Master of Arts


Master of sciences


Degree or engineering diploma


Technician


UASA UCA UDB UTEC
0%


10%


20%


30%


40%


50%


60%


70%


80%


90%


100%


Source: UNCTAD, based on data collected by DIDT.


AnnEx E.
InfoRmATIon on hIghER
EduCATIon InSTITuTIonS


Selected data from a brief survey carried out by the
Directorate of Innovation and Technological Develop-


ment (DIDT) of mINEC, which provide some evidence
(although not statistically significant) of aspects of
higher education and research in El Salvador. The in-
stitutions which replied to the questionnaire were the
Autonomous University of Santa Ana (UASA), the Cen-
tral American University (UCA), Don Bosco University
(UDB) and the Technological University (UTEC).




144 Science, Technology and Innovation Policy Review - El Salvador


Figure E.3. Student-teacher ratio


UTEC


UDB


UCA


UASA


0 5,000 10,000 15,000 20,000


Number of students


Nu
m


be
r o


f t
ea


ch
er


s


0


100


200


300


400


500


600


Source: UNCTAD, based on data collected by DIDT.


Figure E.4. Ratio of research staff, by adademic level, to total teaching staff


0% 5% 10% 15% 20%


UASA


UCA


UDB


UTEC


Doctor of Philosphy (PhD)


Doctor of Medicine
or Odontology


Doctor


Master of Arts


Master of sciences


Degree or engineering diploma


Technician


Source: UNCTAD, based on data collected by DIDT.




145annexeS


AnnEx f.
BIBlIomETRIC STudy of
SAlvAdoRIAn SCIEnTIfIC
ouTPuT


1. Note on methodology
This brief bibliometric study is intended to assist
in identifying the strongest areas of research in El
Salvador, in order to guide decision making with
regard to setting STI priorities. In general terms,
the study measures the “international visibility” and
other attributes of publications in which Salvadorian
researchers participated during a specific period.
In this case, it was decided to include all recorded
output. This international visibility is determined, in
this type of study, on the basis of the publication in
indexed journals, i.e. journals whose bibliographies
and references cited in each of its articles are
automatically recorded in databases of recognized
prestige.15 In this study, the ISI16 Web of Knowledge
database of Thomson Reuters, the most widely
recognized internationally, was used.


For the study, all articles published in journals were
collected,17 up to the first fortnight of September
2010, in which an author registered as resident in El
Salvador participated. once the bibliographic records
had been extracted, the following database fields
were used: name of author, title of article, authors’
addresses, address of principal author, institution in
which the research was carried out, subject category
(according to the ISI), key words assigned by the
authors, key words assigned by the ISI and number
of citations of the article (at the date of collection of
the data). For comparative purposes, publications of
the Central American countries and some of the most
important economies in Latin America were collected,
in this case limited to the period 2000 to 2010 (Figures
F.3 and F.4).


By using spread sheets, statistical programmes and
specialized bibliometric analysis programmes, the
various fields were processed to obtain graphs and
tables which show indicators such as: the number of
articles by subject category, differentiating between
the institution and country of residence of the principal
author; the impact of articles by subject category and
by institutions, differentiating the country of residence
of the principal author; the research subjects in which
there is the greatest scientific output; the collaboration


networks established with other countries for research
purposes, etc.


With regard to the subjects and patterns of research,
various analytical methods were used: construction
of networks and statistical processes. The first type
of method was used to identify the most frequently
recurring groups of research headings and their
relationships, taking into account the total number
of articles, and also the subject groups in which the
greatest amount of research was carried out and
their relationships. on the other hand, the statistical
methods were used to make comparisons between
articles in which the primary author was based in El
Salvador and those where the primary author was
based abroad. The following variables were used for
this analysis: number of publications and their impact
by subject group; number of publications and their
impact by country; and number of publications and
their impact by Salvadorian institution.


The impact, which is an indicator used on various
occasions in this study, is generally defined as
the number of citations divided by the number of
publications. In this case, it is the number of citations
received by articles in each subject category and each
country, divided by the total number of publications
in that category and country during the period
determined by the study. It is an indicator which
provides an approximation of the level of quality of
the articles, by relating the articles which the scientific
community considers useful for its work (by means of
citations) to the total volume of published articles.


Interpretation of the networks


Some of the graphs used in bibliometrics are networks
which refer to different types of relationships. The
networks are formed of nodes and connectors
(relations). In the example of Figure F.1, the countries
are the nodes and the lines which connect them, the
relations. Depending on the type of analysis which
is being carried out, it is important to distinguish
between three aspects of the networks: the frequency
of appearance of each node (number in the rectangle
next to the name of the country); the frequency with
which each node is paired with another (frequency of
pairs, represented by the number enclosed in a circle
on the connector); and the number of relations which
each node has with the rest, or connectivity (number
of lines issuing from each node).


Thus, in the example, the El Salvador node has a




146 Science, Technology and Innovation Policy Review - El Salvador


Source: UNCTAD.


Figure F.1. Example of a network


United States


Mexico


Costa Rica


El Salvador
Nicaragua


Guatemala


Honduras


16


15


25


14


22


17


31


26
26


35


23


35
15


19


151


Brazil


frequency of pairs of 151 with the United States,
representing the number of times a Salvadorian and
American appear as co-authors of an article. It has
a connectivity of seven, indicating co-authorship
relations with seven countries. The example in Figure
F.1 is a highly simplified network, as it uses thresholds
of these factors to eliminate their complexity,
improve understanding and extract more significant
conclusions.


2. Results
420 publications were identified in indexed journals in
which authors resident in El Salvador had participated.18
of this total, in 186 cases, they appears as the primary
authors, which means in recent years an average of
4 articles per year in this type of medium (see Figure
F.2). In absolute terms, the number of articles is low. If
historic information on investment in R&D and human
resources involved in scientific and technological


activities were available, real productivity could be
estimated with greater precisions. Nevertheless,
Figure F.3 shows that El Salvador has the lowest
scientific output in Central America, despite having a
better economic position than guatemala, Honduras
and Nicaragua.


Also for comparative purposes, Figure F.4 shows that
guatemala, El Salvador, Honduras and Nicaragua
have a greater research output in the social sciences
and humanities than the other countries (although the
difference is small and the proportion with respect to
natural sciences is less than 20 per cent). However, in
the case of El Salvador, Figure F.4 is highly significant
when taking into account the data on expenditure on
scientific and technological activities such as R&D.
As can be seen from Figure F.5, total expenditure
on the social sciences and humanities in 2008 was
approximately 45 and 55 per cent for each of these
headings. In other words, there is a great disparity




147annexeS


Figure F.3. Comparison of scientific output in Central
America and certain Latin American countries,
2000-2010 (x-axis on logarithmic scale)


7,000


1,000


2,000


3,000


4,000


5,000


6,000


0
100 1,000 10,000


GD
P


pe
r c


ap
ita


Average annual publications


Mexico


Brazil


Argentina


Chile


Panama


Guatemala
Honduras


Nicaragua
El Salvador


Costa Rica


Source: UNCTAD, based on ISI Web of Knowledge data.


Figure F.2. Total number of publications by nationality
of primary author, 1991-2010


1993
1992
1991


1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005


2007
2006


2008
2009
2010


40 2030 10 0 4020 3010


Ye
ar


Number of publications


Nationality of primary author


Other countriesEl Salvador


Source: UNCTAD, based on ISI Web of Knowledge data.


between research output by areas of knowledge, in
that the areas which receive less than 50 per cent of
the budget produce over 80 per cent of the scientific
output with international visibility.


The joint research relations take place essentially with
the United States and, to a lesser extent, with Spain
and the neighbouring countries of Central America
– Honduras, guatemala and Costa Rica (see Figure
F.7). Figure F.6 shows the pattern of joint publications
where the principal authors are in El Salvador and
the United States, observing that output of the latter
has been growing since 2000, as well as the general
greater impact of works where the primary author is
resident in the United States.


The research subjects where intensity of publication is
greatest are public, environmental and occupational
health, especially tropical medicine, dermatology, in-
fectious diseases and oncology. There is also consid-
erable output in plant sciences, their pharmacological
applications and biochemical supports. other areas
which stand out are ecology, zoology, entomology,
veterinary sciences and earth sciences (Figure F.8).
Figures F.9 and F.10 show, respectively, the compari-
son between subject areas with the most publications
and those with the greatest impact on the scientific
community. With respect to the latter, the areas which


stand out, taking into account the totality of the ar-
ticles, are immunology, research into the respiratory
system, meteorology and atmospheric sciences, and
food science and technology.


on the other hand, taking into account only articles
in which the primary author is resident in El Salvador
(Figures F.11 and F.12), the publications with the
greatest impact relate to oncology, orthopaedics,
health policy and services, paediatrics, andrology,
nutrition and ophthalmology. Finally, the research
bodies with the greatest output are, in first place, the
University of El Salvador, followed a long way behind
by the Central American University, the Center for
Disease Control and Prevention, CENTA and the US
Department of Health and Human Services (Figure
F.13). However, considering the impact of publications,
research by Salvadorian bodies appears to have
little impact (less than 5 citations per article) with the
exception of Rosales Hospital (Figure F.14).




148 Science, Technology and Innovation Policy Review - El Salvador


Figure F.4. Distribution of scientific and humanist output in Central America and certain Latin American countries, 2000-2010


Arts and humanities Social Sciences Natural sciences


0%


10%


20%


30%


40%


50%


60%


70%


80%


90%


100%


Argentina Brazil Chile Costa Rica El Salvador Guatemala Honduras Mexico Nicaragua Panama


Source: UNCTAD, based on ISI Web of Knowledge data.


Figure F.5. Expenditure on scientific and techological research and development by area of knowledge, 2009


Expenditure on S&T Expenditure on R&D


Humanities


Social sciences


Agricultural sciences


Medical sciences


Engineering
and technology


Exact and natural
sciences


0%


10%


20%


30%


40%


50%


60%


70%


80%


90%


100%


Source: CONACYT 2010.




149annexeS


Figure F.6. Patterns of publications of articles whose primary author resides in El Salvador and the United States
and annual impact factor, 1981-2010


Nu
m


be
r o


f p
ub


lic
at


io
ns


Im
pa


ct
fa


ct
or


El Salvador
United States


El Salvador impact
United States impact


Linear (El Salvador)
Linear (United States)


-2


0


2


4


6


8


10


12


14


0


20


40


60


80


100


120


198
1


198
2


198
3


198
4


198
5


198
6


198
7


198
8


198
9


199
0


199
1


199
2


199
3


199
4


199
5


199
6


199
7


199
8


199
9


200
0


200
1


200
2


200
3


200
4


200
5


200
6


200
7


200
8


200
9


201
0


Source: UNCTAD, based on ISI Web of Knowledge data.


Figure F.7. Network of collaboration between authors by country of residence


USA*


Mexico


Costa Rica


El Salvador


Argentina Panama


Colombia


Peru


Venezuela


Spain


Nicaragua


Guatemala


Honduras


16


25


14


14
10


18


17


17


17


12


12


12


12


22


13


26


26


23


35


35


38


15


15


15
11


11


9


9


9


9


9


9


19


151


Brazil


31


* United States of America.
Source: UNCTAD, based on ISI Web of Knowledge data.




150 Science, Technology and Innovation Policy Review - El Salvador
Fi


gu
re


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s


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: U


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as


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.




151annexeS


Figure F.9. Principal subject categories ranked by number of publications (including impact factor)


0 10 20 30 40 50 60


Impact factor


0.00 2.00 4.00 6.00 8.00 10.00 12.00


Public, environmental and occupational health


Dermatology


Plant sciences


Entomology


Oncology


Gynaecology and obstetrics


Infectious diseases


Agronomy


Medicine, general and internal


Biology


Geochemistry and geophysics


Zoology


Number of publications Impact factor


Number of publications


Source: UNCTAD, based on ISI Web of Knowledge data.




152 Science, Technology and Innovation Policy Review - El Salvador


Figure F.10. Principal subject categories ranked by impact factor (including number of publications)


0 10 20 30 40 50 60


Ecology


0 10 20 30 40 50 60


Inmunology


Respiratory system


Meteorological and atmospheric sciences


Food science and technology


Orthopaedics


Psychology


Genetics and heredity


Microbiology


Fisheries


Health policy and services


Andrology


Impact factor


Number of publications Impact factor


Number of publications


Source: UNCTAD, based on ISI Web of Knowledge data.




153annexeS


Figure F.11. Subject categories ranked by number of publications when the primary author resides in El Salvador
(including impact factor)


0 10 20 30 40 50 60


Impact factor


0.00 2.00 4.00 6.00 8.00 10.00 12.00


Dermatology


Public, environmental and occupational health


Plant sciences


Entomology


Biology


Agronomy


Gynaecology and obstetrics


Zoology


Social sciences, Interdisciplinary


Religion


Ecology


Energy and fuels


Number of publications Impact factor


Number of publications


Source: UNCTAD, based on ISI Web of Knowledge data.




154 Science, Technology and Innovation Policy Review - El Salvador


Figure F.12. Subject categories ranked impact factor when the primary author resides in El Salvador
(including number of publications )


Number of publications Impact factor


0 10 20 30 40 50 60


- 5 10 15 20 25 30


Oncology


Orthopaedics


Health policy and services


Paediatrics


Andrology


Nutrition and dietetics


Ophthalmology


Dermatology


Medicine, general and internal


Materials sciences, Interdisciplinary


Social work


Agriculture, Multidisciplinary


Impact factor


Number of publications


Source: UNCTAD, based on ISI Web of Knowledge data.


Figure F.13. Research bodies with the greatest number of publications (including impact factor)


Number of publications Impact factor


0 10 20 30 40 50 60


0 5 10 15 20 25 30


Impact factor


Number of publications


Univ El Salvador
Univ Centroamericana


Ctr dis control
CENTA


US Dept hew
Univ Salvadorena Alberto


Asociac demog salvadoren
Ctr dermatol & cosmet su


Minist Agr & Ganaderia
Comis ejecut hidroelect


Community conservat inc
Hospital Benjamin Bloom


Hospital Matern San Salvador
Hospital National Ninos Benjamin


Hospital Rosales
La Univ Tecnol


Minist Medio Ambiente
N/A


Asociac promotora desarr
Azhar fac med


Source: UNCTAD, based on ISI Web of Knowledge data.




155annexeS


Figure F.14. Research bodies with the greatest impact factor (including number of publications)


Number of publications Impact factor


0 10 20 30 40 50 60


0 5 10 15 20 25 30


Impact factor


Number of publications


Benjamin Bloom Childrens
Cent Amer res agcy


Cent Amer malaria res st
Hospital Rosales


Ctr dermatol & cosmet su
Salvadorean inst soc sec


FAO
US dept hew


Comis ejecut hidroelect
Asociac demog salvadoren


Co amer embassy
Hospital Benjamin Bloom
Socorro luterano salvado


Cent amer res stn
Univ Andres Bello


Ctr dis control
Inst salvadoreno invest


Univ El Salvador
Evangel Univ El Salvador


CENTA


Source: UNCTAD, based on ISI Web of Knowledge data.


Figure F.15. Output of scientific articles with international visibility, 1940-2010


Nu
m


be
r o


f p
ub


lic
at


io
ns


0


3


6


9


12


15


18


21


24


1940–70 1971–80 1981–90 1991–2000 2001–10


UES


UCA


USAM


UTEC


Source: UNCTAD, based on ISI Web of Knowledge data.




156 Science, Technology and Innovation Policy Review - El Salvador


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at
io


ns
- D


ev
elo


pm
en


t o
f a


d
id


ac
tic


c
om


pu
te


r f
or



te


ac
hi


ng
b


as
ic


p
ro


gr
am


m
in


g
- R


es
ea


rc
h


in
p


ro
to


co
ls


an
d


w
ire


les
s


br
oa


db
an


d
co


m
m


un
ic


at
io


n
- T


ec
hn


ol
og


ic
al


pr
in


ci
pl


es
o


f w
ire


les
s


co
m


m
un


itie
s


an
d


fe
as


ib
ilit


y
of


in
st


all
in


g
th


em
in


s
ch


oo
ls


in
c


lo
se


g
eo


gr
ap


hi
ca


l
pr


ox
im


ity
to


D
on


B
os


co
U


ni
ve


rs
ity


- R
es


ea
rc


h
in


to
th


e
te


ch
ni


ca
l v


iab
ilit


y
of



im


pl
em


en
tin


g
Te


rre
st


ria
l D


ig
ita


l r
ad


io
in



El


S
alv


ad
or


3
Fr


an
ci


sc
o


Ga
vid


ia
Un


ive
rs


ity
- C


om
pu


te
r s


ys
te


m
s



te


ch
ni


ci
an


- C
om


pu
te


r m
ain


te
na


nc
e



an


d
re


pa
ir


te
ch


ni
ci


an
- T


ele
co


m
m


un
ic


at
io


n


en
gi


ne
er


in
g


te
ch


ni
ci


an


- C
om


pu
te


r s
ci


en
ce


s
en


gi
ne


er
- T


ele
co


m
m


un
ic


at
io


ns


en
gi


ne
er


- E
lec


tro
ni


cs
e


ng
in


ee
r


- M
as


te
r o


f b
us


in
es


s


m
an


ag
em


en
t w


ith


sp
ec


ial
iza


tio
n


in
e


lec
tro


ni
c


co
m


m
er


ce
- M


as
te


r o
f a


pp
lie


d
in


fo
rm


at
io


n
te


ch
no


lo
gy


in


ne
tw


or
ks


- M
as


te
r o


f e
du


ca
tio


na
l


te
ch


no
lo


gy


Co
nt


in
ui


ng
e


du
ca


tio
n


te
ch


ni
ca


l c
ou


rs
es


(3
0-


50


cla
ss


ro
om


h
ou


rs
):


- A
ut


oC
AD


- T
ele


ph
on


e
ex


ch
an


ge
s


- E
lec


tro
ni


c
co


m
m


er
ce


- G
ra


ph
ic


d
es


ig
n


an
d


W
eb



pa


ge
s


- F
ib


re
o


pt
ic


c
ab


le
an


d
in


st
all


at
io


n
- C


om
pu


te
r m


ain
te


na
nc


e
- J


AV
A


pr
og


ra
m


m
in


g


Gr
ad


ua
tio


n
st


ud
ies


:
- I


nc
ub


at
or


o
f I


CT
c


om
pa


ni
es


- U
ni


ve
rs


ity
-c


om
pa


ny
lin


ks
a


nd
p


ro
vis


io
n


of
te


ch
no


lo
gi


ca
l s


er
vic


es


4
Jo



S


im


n
Ca


ña
s


Ce
nt


ra
l A


m
er


ic
an



Un


ive
rs


ity
(U


CA
)


- D
eg


re
e


in
c


om
pu


te
r


sc
ien


ce
s


5
Te


ch
no


lo
gi


ca
l


Un
ive


rs
ity


- N
et


w
or


k
en


gi
ne


er
in


g
te


ch
ni


ci
an


- S
of


tw
ar


e
en


gi
ne


er
in


g
te


ch
ni


ci
an


- H
ar


dw
ar


e
en


gi
ne


er
in


g
te


ch
ni


ci
an


- C
om


pu
tin


g
an


d
sy


st
em


s
en


gi
ne


er
- D


eg
re


e
in


in
fo


rm
at


io
n


te
ch


no
lo


gy
.


- D
eg


re
e


in
b


us
in


es
s


m
an


a-
ge


m
en


t w
ith


e
m


ph
as


is
on



co


m
pu


tin
g


- K
no


w
led


ge
s


oc
iet


y
w


ith
g


en
de


r
pe


rs
pe


ct
ive


in
E


l S
alv


ad
or


An
ne


x
G.


P
ro


vi
si


on
o


f e
du


ca
tio


n
at


te
ch


ni
ca


l,
hi


gh
er


e
du


ca
tio


n
an


d
po


st
gr


ad
ua


te
le


ve
l a


nd
R


&
D


ac
tiv


iti
es


in
IC


T
in


e
du


ca
tio


na
l i


ns
tit


ut
io


ns
, E


l S
al


va
do


r,
20


11
(c


on
t.)




157annexeS
An


ex
o


G.
O


fe
rt


a
de


fo
rm


ac


n
a


ni
ve


l t
éc


ni
co


, d
e


ed
uc


ac


n
su


pe
rio


r,
y


po
st


gr
ad


o
y


ac
tiv


id
ad


es
d


e
I+


D
en


T
IC


e
n


in
st


itu
ci


on
es


e
du


ca
tiv


as
, E


l S
al


va
do


r,
20


11
(c


on
t.)


In
st


itu
tio


n
Te


ch
ni


ca
l s


tu
di


es
Un


iv
er


si
ty


c
ou


rs
es


(e
ng


i-
ne


er
in


g/
de


gr
ee


)
Po


st
gr


ad
ua


te
s


tu
di


es
Ot


he
r s


tu
di


es
R&


D
ac


tiv
iti


es


6
Ca


pi


n
Ge


ne
ra


l
Ge


ra
rd


o
Ba


rri
os



Un


ive
rs


ity


- C
om


pu
te


r p
ro


gr
am


m
in


g
te


ch
ni


ci
an


- H
ar


dw
ar


e
en


gi
ne


er
in


g
te


ch
ni


ci
an


- S
ys


te
m


s
an


d
co


m
pu


te
r


ne
tw


or
k


te
ch


ni
ci


an


- S
ys


te
m


s
an


d
co


m
pu


te
r


ne
tw


or
ks


e
ng


in
ee


r
- D


eg
re


e
in


c
om


pu
tin


g


7
Pe


da
go


gi
c


Un
ive


r-
sit


y
of


E
l S


alv
ad


or
- C


om
pu


te
r s


ys
te


m
s


te
ch


ni
ci


an
- D


eg
re


e
in


c
om


pu
te


r
m


an
ag


em
en


t


8
Po


lyt
ec


hn
ic


al
Un


ive
rs


ity
- C


om
pu


te
r s


ys
te


m
s


te
ch


ni
ci


an
- C


om
pu


te
r s


ci
en


ce
s


en
gi


ne
er


9
Dr


. J
os


é
M


at
ías



De


lg
ad


o
Un


ive
rs


ity
- D


eg
re


e
in


c
om


pu
te


r
m


an
ag


em
en


t.
- E


lec
tro


ni
cs


a
nd



co


m
m


un
ic


at
io


ns
e


ng
in


ee
r


- M
as


te
r o


f v
irt


ua
l e


du
ca


tio
n


10
So


ns
on


at
e


Un
i-


ve
rs


ity
- C


om
pu


te
r s


ys
te


m
s


en
gi


ne
er


11
Ev


an
ge


lic
al


Un
ive


r-
sit


y
of


E
l S


alv
ad


or
- C


om
pu


te
r n


et
w


or
ks


a
nd



te


ch
no


lo
gy


te
ch


ni
ci


an
- C


om
pu


te
r s


ys
te


m
s


en
gi


ne
er


- C
IS


CO
A


ca
de


m
y


12
M


on
se


ño
r O


sc
ar



Ar


nu
lfo


R
om


er
o


Un
ive


rs
ity


- D
eg


re
e


in
c


om
pu


te
r


sc
ien


ce
s


13
Al


be
rt


Ei
ns


te
in



Un


ive
rs


ity
- C


om
pu


tin
g


en
gi


ne
er


- C
om


pu
te


r o
pe


ra
to


r
- S


of
tw


ar
e


ex
ec


ut
ive


- W
eb


pa
ge


d
es


ig
n


- C
om


pu
te


r a
ss


ist
ed


d
ra


w
in


g
- S


ys
te


m
s


an
aly


st
-d


ev
elo


pe
r


- C
om


pu
te


r m
ain


te
na


nc
e


an
d


re
pa


ir


Gr
ad


ua
tio


n
w


or
k:



- D


es
ig


n
of


in
tra


ne
t f


or
H


ot
el


Ro
ya


l
De


ca
m


er
on


S
ali


ni
ta


s
- C


om
pu


te
r s


ec
ur


ity
, t


he
or


y,
m


an
ag


em
en


t
an


d
pr


ac
tic


e
- D


id
ac


tic
g


ui
de


to
d


ig
ita


l m
et


ho
ds


w
ith



ap


pl
ic


at
io


n
in


c
+


+
- L


in
ux


o
pe


ra
tin


g
m


an
ua


l f
or


d
id


ac
tic



ap


pl
ic


at
io


ns
- O


bj
ec


t o
rie


nt
ed


p
ro


gr
am


m
in


g
us


in
g


di
da


ct
ic


e
xa


m
pl


es
in


ja
va


, u
sin


g
jg


ra
sp


- D
es


ig
n


an
d


im
pl


em
en


ta
tio


n
of


a
m


ul
tif


ib
re



sy


nc
hr


on
ize


d
se


rv
er


fo
r b


us
in


es
s


m
ob


ile


ap
pl


ic
at


io
ns




158 Science, Technology and Innovation Policy Review - El Salvador


In
st


itu
ci


ón
Es


tu
di


os


cn
ic


os
Ca


rr
er


as
u


ni
ve


rs
ita


ria
s


(In
ge


ni
er


ía
/


lic
en


ci
at


ur
a)


Es
tu


di
os


d
e


po
st


gr
ad


o
Ot


ro
s


es
tu


di
os


Ac
tiv


id
ad


es
e


n
I+


D


- C
om


pu
te


r s
ys


te
m


fo
r i


nf
or


m
at


io
n


m
an


ag
em


en
t i


n
th


e
ele


ct
ive


s
ur


ge
ry


a
re


a
of


th
e


Ro
sa


les
N


at
io


na
l H


os
pi


ta
l


- A
pp


lic
at


io
n


of
g


eo
gr


ap
hi


ca
l in


fo
rm


at
io


n
sy


st
em


s
fo


r i
ns


tit
ut


io
na


l m
an


ag
em


en
t


an
d


de
ci


sio
n-


m
ak


in
g


- T
oa


d
an


d
db


ar
tis


an
to


ol
s


fo
r


m
an


ag
em


en
t a


nd
in


te
gr


at
io


n
of


re
lat


io
na


l
da


ta
ba


se
s.


14
Oc


ci
de


nt
e


Ca
th


ol
ic



Un


ive
rs


ity


- C
om


pu
te


r s
ys


te
m


s
en


gi
ne


er
- D


eg
re


e
in


m
an


ag
em


en
t


in
fo


rm
at


io
n


sy
st


em
s


15
Cr


ist
ian


a
de


L
as



As


am
bl


ea
s


de
D


io
s


Un
ive


rs
ity


- C
om


pu
te


r s
ci


en
ce


s
en


gi
ne


er


16
Dr


. A
nd



s


Be
llo



Un


ive
rs


ity
- C


om
pu


te
r t


ec
hn


ic
ian


- I
nf


or
m


at
io


n
ne


tw
or


ks


te
ch


ni
ci


an
- C


om
pu


te
r m


ain
te


na
nc


e
te


ch
ni


ci
an


- D
eg


re
e


in
c


om
pu


tin
g


Re
se


ar
ch


a
re


as
:


- D
es


ig
n


an
d


m
an


ag
em


en
t o


f i
nf


or
m


at
io


n
to


ol
s


an
d


pr
om


ot
io


n
of


to
ur


ist
p


ro
du


ct
s


on
th


e
In


te
rn


et
- D


es
ig


n
of


to
ol


s
fo


r r
ec


od
in


g,
p


ro
ce


ss
a


nd


an
aly


sis
o


f h
ea


lth
in


fo
rm


at
io


n


17
Sa


lva
do


ria
n


Lu
th


er
an


U
ni


ve
rs


ity
- D


eg
re


e
in


c
om


pu
te


r
sc


ien
ce


s


18
Sa


lva
do


ria
n


Al
be


rto


M
as


fe
rre


r U
ni


ve
rs


ity
- D


eg
re


e
in


c
om


pu
te


r
sc


ien
ce


s


19
IT


CA
-F


EP
AD


E
Sp


ec
ial


ize
d


En
gi


ne
er


in
g


Sc
ho


ol


- C
om


pu
te


r m
ain


te
na


nc
e


te
ch


ni
ci


an
- T


ele
co


m
m


un
ic


at
io


ns


te
ch


ni
ci


an
- I


nf
or


m
at


io
n


sy
st


em
s


te
ch


ni
ci


an
- C


om
pu


te
r n


et
w


or
ks



te


ch
ni


ci
an


- C
IS


CO
A


ca
de


m
y


- D
ev


elo
pm


en
t o


f s
of


tw
ar


e
ap


pl
yin


g
ar


tif
ic


ial
in


te
llig


en
ce


te
ch


no
lo


gy


So
ur


ce
: U


N
C


TA
D


, b
as


ed
o


n
in


fo
rm


at
io


n
av


ai
la


bl
e


on
w


eb
si


te
s


of
th


e
va


rio
us


h
ig


he
r e


du
ca


tio
n


in
st


itu
tio


ns
, M


ay
2


01
1.


An
ex


o
G.


O
fe


rt
a


de
fo


rm
ac



n


a
ni


ve
l t


éc
ni


co
, d


e
ed


uc
ac



n


su
pe


rio
r,


y
po


st
gr


ad
o


y
ac


tiv
id


ad
es


d
e


I+
D


en
T


IC
e


n
in


st
itu


ci
on


es
e


du
ca


tiv
as


, E
l S


al
va


do
r,


20
11




159annexeS


noTES
1 Included in the Integral Export Development Strategy 2010-2014.
2 CoNACyT, 2006.
3 Andersen 1994.
4 See: Freeman, 1987; Lundvall, 1992a; Nelson, 1993.
5 It should be emphasized that the concept of institutions refers to “rules of the game” in the context of nations,


such as legislation, regulations, usages and customs, etc., and should not be confused with organizations.
6 The classic reference in this sense is Edquist, 1997; see also mcKelvey, 1991. In addition, recent works by the


original proponents of the concept usually make reference to the differences between the different approaches
(Freeman 1995, 2002; Lundvall et al., 2002; Nelson and Nelson, 2002).


7 Dalum et al. 1992.
8 oECD 1994, 1999, 2002; Edquist et al. 1998; Soete and STRATA-ETAN Expert group 2002.
9 It is a process which goes from perception to analogy and subsequently to isomorphism (Beer 1984).
10 general Systems Theory (von Bertalanffy 1968).
11 This is chiefly reflected in the debate (which may be insoluble) concerning appropriate limits or boundaries for


the analysis of systems of innovation.
12 The RICyT databases are prepared from information provided by bodies responsible for science and technology


statistics in each country. A degree of caution is required in making comparisons, as the information is
frequently incomplete.


13 http://lp.espacenet.com/advancedSearch?locale=es_LP.
14 Which means that they do not necessarily have Salvadorian nationality.
15 Journals (of any country) which wish to be indexed must satisfy various criteria which guarantee their quality


and value to the scientific community. It should be mentioned that there will always be a slight bias and
limitations in using these databases, as there is a predominance of publications in English. Nevertheless,
they largely reflect the visibility in the most relevant media used by the scientific community to disseminate
its research.


16 Institute of Scientific Information.
17 All the databases were included: sciences, social sciences, arts and humanities.
18 The period covered by the research includes from 1941, although there were only three publications before


1972, the year when they began to increase in number and regularity.
19 Subject categories assigned by ISI.






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