Exports grew 13% in January of 2022
El Salvador is not making headlines about the numbers coming out suitable for 2021 in GDP growth. Double digits for El Salvador after making Bitcoin legal tender in the year 2021, overcoming the odds of the Covid Crisis for a small country. The exports of El Salvador led to the countries boost in GDP. This is the first time for El Salvador to reach double digits. And coincidently, it is after adopting Bitcoin.
What is GDP?
Gross domestic product (GDP) is the measurement used to display a country’s economic/market value of finished goods and services produced within the country. A country with a larger GDP will have more significant amounts of goods and services generated within, creating a higher standard of living for its citizens. Hence, “GDP growth” and “economic growth” are used interchangeably by citizens and political leaders to boost national success. But it should not be the standard for a country to be prosperous economically based on GDP because central banks rate lending based on regulated GDP. As a result, small countries are restricted on what goods and services they can provide to their citizens, essentially lowering the living standard.
Game Theory in play
El Salvador is the first nation to legalize and accept Bitcoin. It is a domino effect once one country takes because Ukraine was the following country. You can follow up and learn more about it in the following newsletter.
Essentially coming out these following months, El Salvador is issuing a $1 Billion Bitcoin Volcano Bond or up to $5 Billion in Volcano Bonds.
The Game Theory is once other small nations around El Salvador recognizes that El Salvador is grabbing the attention of tourists and large companies due to the adoption of Bitcoin. Bitcoin is a driver of economic growth that banks nearly 8 Million citizens in that country, and almost 50% do not have traditional bank accounts. President Bukele connects his citizens financially and freely to a digital monetary open network. Not just further advancing technologically but with the help of technology, freeing his people financially. A marvel to be seen, and hopefully, that is won.
Setting Precedent
Salvadorian President, Nayib Bukele, is paving the way for nations to follow the road that they are doing in issuing bonds by mining Bitcoin and exporting energy. The idea of adopting Bitcoin brings waves of tourists/companies looking to help people connect to the most substantial monetary money that is natively digital called Bitcoin.
El Salvador's GDP grew 10.3% in 2021