El Salvador has steadily emerged as a competitive destination for light manufacturing, logistics, and export-oriented industries in Central America. A key contributor to this success is the country’s network of industrial parks, which offer specialized infrastructure, proximity to international markets, skilled labor, and favorable business conditions. Among these, the International Free Zone (Zona Franca Internacional) and several other industrial parks in El Salvador have become pivotal for foreign direct investment and global supply chain integration.
Leading Industrial Parks in El Salvador
International Free Zone (Zona Franca Internacional)
Located near Comalapa International Airport and the Port of Acajutla, the International Free Zone (IFZ) is one of the most prominent and strategically located industrial parks in El Salvador. Spanning over 220 hectares, it is designed to accommodate export-oriented manufacturers, logistics providers, and service companies. Tenants benefit from proximity to the Pan-American Highway, streamlining domestic and international freight movements.
Key industries represented include textiles and apparel, electronics assembly, packaging, and distribution. Tenants like HanesBrands and Delta Apparel have operations in the IFZ, leveraging El Salvador’s favorable trade status under agreements such as CAFTA-DR and the Generalized System of Preferences (GSP) with the U.S.
San Marcos Free Zone
Situated near San Salvador, this zone has long been a hub for garment and apparel production. Its urban location offers easy access to El Salvador’s largest labor pool, reducing commuting times and costs for workers. The zone is fully serviced with power, water, waste management, and telecommunications infrastructure, making it an attractive site for labor-intensive industries.
American Industrial Park (AIP)
The AIP is a modern industrial park located in the municipality of Ilopango. It houses several multinational companies in the electronics, automotive parts, and call center sectors. With direct access to El Salvador’s main roads and just 20 minutes from Comalapa International Airport, AIP is optimized for quick product-to-market cycles. The park boasts high-spec buildings, robust security services, and a reliable supply of utilities.
Together, these industrial parks in El Salvador form an integral part of the country’s economic development strategy, enhancing its appeal as a nearshoring destination for North American companies.
Access to Markets, Suppliers, and Labor Pools
El Salvador’s geographic location offers fast and efficient access to the U.S. East and Gulf Coasts within 3 to 5 business days via maritime routes. Air freight from Comalapa International Airport reaches major U.S. cities in less than five hours. For regional trade, the Pan-American Highway connects the country with Guatemala, Honduras, and Nicaragua, creating efficient overland shipping options.
In addition to U.S. market access through CAFTA-DR, El Salvador maintains trade agreements with the European Union, Mexico, Colombia, and Taiwan, among others. This favorable positioning is further enhanced by a local supplier network specializing in textiles, plastics, packaging, and basic electronics assembly.
Labor-intensive industries benefit from the urban proximity of many industrial parks in El Salvador, which reduces worker absenteeism and improves operational efficiency. The capital and surrounding departments account for over 40% of the national workforce, making these locations ideal for scaling operations.
Labor Availability, Cost, and Regulations
El Salvador has a young and abundant labor force with over 60% of the population under the age of 35. The availability of semi-skilled labor is strong in sectors such as textiles, light manufacturing, and customer service. Basic manufacturing wages average between $300 and USD 350 per month, significantly lower than in neighboring countries like Costa Rica or Panama.
The country’s labor laws are generally pro-business. The standard workweek is 44 hours, with overtime paid at 100% of the base wage. The minimum wage is sector-dependent and reviewed periodically. Union activity exists but is not pervasive in most industrial parks in El Salvador. Where unions are present, industrial relations are generally stable, especially in export processing zones.
Government initiatives have also increased the availability of training programs through institutions such as INSAFORP (Salvadoran Institute for Professional Training), which offers subsidized workforce development in collaboration with private industry.
Infrastructure: Transportation, Utilities, and Telecommunications
Industrial parks in El Salvador benefit from a growing investment in transportation and utility infrastructure. The recently modernized Port of Acajutla and expanding Comalapa International Airport provide reliable logistics options for exporters. The proposed Pacific Airport and Dry Canal connecting El Salvador to Honduras’ Atlantic coast are expected to reduce transportation bottlenecks further.
Power costs in El Salvador average $0.13 to $0.17 per kWh for industrial use. Renewable sources now account for over 60% of electricity generation, enabling companies to meet their sustainability targets. The water supply is generally adequate. Telecommunications are robust, with fiber-optic networks and nationwide 4G LTE coverage.
Security services are prioritized across all major parks, often including perimeter fencing, private security guards, surveillance systems, and coordination with national law enforcement agencies. Waste management, particularly for hazardous materials, is regulated but manageable, with several certified providers operating in-country.
Tax Incentives and Regulatory Environment
Export-oriented companies operating within designated free zones enjoy a suite of fiscal incentives, including:
- 100% exemption from income tax for up to 15 years.
- No import duties on raw materials, machinery, and equipment.
- Exemption from municipal taxes and real estate transfer taxes.
Incentives are governed by the Free Zones and Inward Processing Law and administered by PROESA (now part of Invest in El Salvador), which offers one-stop facilitation services. These advantages make industrial parks in El Salvador especially attractive for companies seeking cost efficiencies and preferential trade access.
The regulatory environment is considered business-friendly. According to the World Bank’s Ease of Doing Business index (before its discontinuation), El Salvador ranked well in categories like starting a business and trading across borders.
Lease Rates, Construction, and Operating Costs
Industrial space within El Salvador’s top parks typically leases from $4.00 to $6.00 per square meter per month, depending on building specifications, services, and location. Build-to-suit options are available, with construction costs ranging from $400 to $600 per square meter.
Operating costs are low to moderate by regional standards. Facility management services—including cleaning, maintenance, waste management, and 24/7 security—can cost between $0.50 and $1.00 per square meter per month.
Reliable electricity, water, and telecom services help reduce downtime and ensure compliance with international quality and safety standards. Environmental regulations for wastewater discharge and emissions are enforced but not prohibitively strict, particularly in designated industrial zones.
Logistics and Freight Costs
Logistics costs vary depending on the distance to customers and the type of transport. Average container shipping costs to U.S. ports range from $1,500 to USD 2,500, with door-to-door LCL (less-than-container load) services available through freight forwarders. Air freight to U.S. destinations costs around $2.00 to $5.00 per kilogram, depending on volume and urgency.
Domestically, last-mile delivery is efficient due to El Salvador’s compact geography. Most urban zones are within a three-hour drive from major ports and airports. Proximity to Guatemala and Honduras offers access to suppliers and regional distribution hubs, supporting cross-border logistics strategies.
Tenant Mix and Cluster Benefits
The tenant mix across the most prominent industrial parks in El Salvador includes global names in apparel (Hanesbrands, Fruit of the Loom), electronics (Yazaki, Jabil), and business process outsourcing (BPO) services (Teleperformance). These clusters create shared labor pools, supplier networks, and training initiatives, allowing businesses to scale operations efficiently.
For example, the textile and apparel cluster centered around San Marcos Free Zone and American Industrial Park provides collective access to dyers, weavers, sewing operations, and logistics providers. Similarly, call center and electronics firms benefit from shared training pipelines and multilingual labor availability in urban parks.
The track record of these parks in retaining and expanding global tenants demonstrates their reliability and strategic value. Many firms that entered El Salvador in the early 2000s have expanded capacity, citing infrastructure reliability and labor quality as key drivers.
Conclusion
Industrial parks in El Salvador offer a compelling value proposition for companies seeking to manufacture or distribute goods across the Americas. With strategic market access, competitive labor costs, well-maintained infrastructure, and strong government support, these zones continue to attract global investment. Parks like the International Free Zone, San Marcos Free Zone, and American Industrial Park have established themselves as anchors of the national economy, enabling El Salvador to compete in global manufacturing and service sectors.
As regional and global supply chains continue to shift, industrial parks in El Salvador will play a crucial role in enhancing Central America’s integration into nearshoring and reshoring strategies. With thoughtful planning and ongoing infrastructure upgrades, El Salvador is well-positioned to expand its footprint in global trade.