El Salvador has the potential to emulate Singapore and establish itself as a financial hub in the Americas, according to Gabor Gurbacs, a strategy adviser at investment management firm VanEck.
“I frequently tell portfolio managers and asset allocators that El Salvador could be the Americas’ equivalent of Singapore,” Gurbacs posted on X (formerly known as Twitter) on October 28.
Gurbacs anticipates that fresh capital investment and immigration will be the primary catalysts for El Salvador’s economic expansion in the coming years, similar to the growth Singapore experienced in the late 1990s.
His remarks were in response to an October 28 post by US broadcaster and Bitcoin enthusiast Max Keiser, who has relocated to El Salvador. Keiser’s post, captioned “Move to #ElSalvador, The New Land of the Free,” highlighted Bitcoin and the US dollar’s legal tender status, a reduction in crime, beautiful beaches, and excellent coffee as reasons to consider El Salvador.
The country gained prominence as an emerging economy following Nayib Bukele’s election as president in June 2019. By August of this year, El Salvador’s sovereign bonds had outperformed many other emerging markets, yielding a remarkable 70% return, capturing the attention of JPMorgan and other significant investment banks.
In September 2021, Bukele and the El Salvador government declared Bitcoin as legal tender and introduced the Chivo Wallet, a Bitcoin custodial wallet, for all Salvadorans.
El Salvador is also harnessing its volcanic energy resources to power a Bitcoin mining operation, Volcano Energy, which was launched in June following a $1 billion investment. Max Keiser serves as the executive chairman of the company.
October saw the launch of its first mining pool, a collaboration with Bitcoin miners Luxor Technology. In May, El Salvador appointed Saifedean Ammous, author of “The Bitcoin Standard,” as an economic advisor to the National Bitcoin Office, with plans to accumulate Bitcoin as part of a strategy to alleviate its national debt over the next five years.
In April, Bukele also took the bold step of eliminating all taxes on technological innovations, a move likely to attract more entrepreneurs and foreign capital to the country.
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