The Politics of Neoliberalism in Postwar El Salvador

Abstract

In El Salvador a substantial neoliberal economic reform program was implemented by the first government of the Alianza Democratica Nacionalista, known as ARENA. This right-wing party had come to power by the ballot box, though under the militarized conditions imposed by the war, providing limited possibilities for the opposition to participate. The first ARENA president, Alfredo Cristiani, not only adopted far-reaching economic adjustment policies but also signed a peace accord with the guerrilla movement FMLN (Frente Farabundo Marti para la Liberacion Nacional) in 1992. This accord not only aimed to put an end to the civil war; it was also intended to support a sustainable peace and emphasized the deep social, political, and economic roots of the civil war in Salvadoran history. Hence in the postsettlement period, demilitarization and political democratization should have been combined with policies of national reconciliation and the alleviation of poverty.1 However, the peace treaties did not discuss the future economic policies and in practice, neoliberal policies were dominant during the postwar reconstruction period. The fact that economic policies were not discussed gave rise to widespread criticism from the Salvadoran left. Leftists wondered whether a sustainable peace could be achieved in the context of neoliberal economic policies, since these were associated with, among other things, a limited role for the state and limited redistribution. Others reasoned that economic policies would be at issue in the 1994 elections; it was for this reason and because they were the first elections after the peace accords that these were called the elections of the century. However, the Right won the presidential elections of 1994 and again, those of 1999. Neoliberal policies continued in postwar El Salvador. The neoliberal economic reforms, democratic reforms, and the pacification of Salvadoran society in part occurred simultaneously as they still do and influ-