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El Salvador is the smallest and also the most densely populated country in Central America. It borders the Pacific Ocean between Guatemala and Honduras. It lies on the Gulf of Fonseca, as does Nicaragua further south. It has a population of approximately 5.7 million people as of 2009 on 21,000 km². The capital city of San Salvador is, by some distance, the largest city of the republic. In 2001 El Salvador dropped its own currency, the colon, and adopted the U.S. dollar instead.