Thread: Mexican immigrants sending less money back to native country

Mexican immigrants sending less money back to native country
By Matthias Gafni

Posted: 02/09/2010 02:29:36 PM PST
Updated: 02/09/2010 05:33:33 PM PST


Bright signs in Spanish offer to send customers' money back home to Mexico, Central America and elsewhere at nearly every other business on Oakland's International Boulevard, but the economy has taken its toll.

Layoffs at the storefront office of OrderExpress brought the staff down from four to two in the past year, said Maria Garibay, a cashier who has worked there for 10 years.

The remittance services make money on their fees — usually $10 for each transaction under $1,000. Sometimes, those who do come have little to spare, but will send it anyway, even if the remittance amounts to just $30 or $50, cashiers said.

Carlos Gomez, 30, was one of the few people who arrived with cash at Garibay's office Feb. 3. He sent a few hundred dollars to his mother in Pajacuaran, a small town in the Michoacan state of Mexico.

In better times, Gomez had steady work removing asbestos and would send $200 a month to his family. The cash lifeline helped pay medical bills and other necessities, but both Gomez and his brother, who also lives in Oakland, have been out of work.

Gomez said that the last time he sent money was more than two months ago.

America's depleted economy has hit Mexican immigrants' pocketbooks hard, sharply decreasing the cash wired south of the border.

Mexican workers sent $19.6 billion back to their native country in the first 11 months of last year, down 16 percent from the same period in 2008, according to recent bank reports. In November, Mexico received $1.5 billion in remittances, down 14.4 percent from the previous year. November marked the lowest remittance revenue since February 2005, according to Juan Luis Ordaz Diaz, senior economist for BBVA Bancomer in Mexico City.

"Remittances are the second most important source of foreign currency in Mexico, after oil revenues," Diaz said in an e-mail. They represent close to 3 percent of Mexico's gross domestic product.

The drop in remittances is due to the economic situation faced by Mexican immigrants, a group in which unemployment has doubled since the recession hit, he said.

On a recent afternoon, two red phones sat silent on the front counter of Las Montanas market in Concord. Operated by Orlandi Valuta, a subsidiary of Western Union, the phones provide a quick way to wire money to Mexico or other Latin American countries.

Money transfers have dropped about 20 to 30 percent this year, said market general manager Norma Muhlenbruch.

"A couple years ago, it was a really good business to have," she said as she sold a customer a prepaid phone card, another popular item, which has seen a 10 percent drop in sales.

One customer, Misael, picked up one of the phones and told the operator he wanted to wire $450 to his 28-year-old wife in Puebla, Mexico. It was quite the bounty. Lately, the 28-year-old Concord restaurant worker, who only provided his first name due to immigration concerns, says he can only afford sending $100 to $150 once a month. It is about half as much as he sent a year ago.

Donations to Mexican hometown associations have stopped, said Emigdio Robles. The Livermore resident once coordinated winter fundraisers, sending much-needed blankets and warm clothes south to his native Mexican state of Zacatecas, where winter temperatures often drop below freezing. Not anymore.

"It's cold there right now," said Robles, president and secretary of projects for United Zacatecan Community Development Corporation, a group of 17 hometown associations stretching from Fresno to the Oregon border. "There are a lot of people who need our help."

Hometown associations became powerful during the boom times, sending millions of dollars back to their native pueblos. The organizations pool immigrant donations and, with Mexican government matching funds, pay for village and town infrastructure improvements.

"This year we've not been able to fund one project," Robles said. In the past, his organization would send as much as $1 million in project donations to Zacatecas, and other groups across the country would raise about $20 million annually for the North Central state. Last year, the organization tallied $150,000 nationwide, Robles said.

"They've lost income. They've lost jobs. Some have lost their businesses," Robles said. "So, they have nothing to donate."

About a quarter of his contributors lost their homes to foreclosures, he added.

Robles last year hoped to improve the Zacatecas sewer system, which largely consists of septic tanks, but all funding fizzled out.

The more direct effect is on home life: "It's bad. It goes from having food on the table to not having food on the table," he said.

Remittances, or remesas, have long been a significant revenue source for Mexican families. In 2008, remittances represented 27 percent of the current earnings of households receiving them, Diaz said, down from 37 percent two years earlier.

The situation has led to increased poverty in Mexico, the economist said.

Remittances are not isolated to Mexico. A World Bank Migration and Remittance Trend report estimated remittance flows worldwide last year dropped to $317 billion, falling 6.1 percent from the previous year. Remittances to developing countries are expected to remain flat this year, with modest growth in subsequent years, according to the report.

Migration has also dropped worldwide, according to the report, but existing immigrants have not returned home despite the weak job markets. Applications for temporary work visas in the United States fell sharply last year. As of September, 46,700 petitions had been filed, less than the 65,000 quota for this fiscal year. The previous two years quotas were filled within days of the application opening, according to the World Bank report.

The study cites a lack of demand for workers, but also points to the U.S. stimulus package, which makes it difficult for companies receiving government support to hire foreign workers.

Despite hard times, Robles said immigrants still find the U.S. safer than Zacatecas. Organized crime kidnappings for ransom have increased, said Robles, whose wife's aunt's 89-year-old mother was kidnapped for a $10,000 ransom.

Times are so tough, money has started moving from south of the border north, Robles said.

"Over the years, people have had good ventures in the States and they've invested back in Mexico," he said. "Now they are selling those investments so they are able to survive up here."

At Frieda's Design, a dress shop in the Fruitvale district of Oakland that has a money transfer service, employee Jorge Ruiz noticed a similar trend.

"People are sending money to help people here."


http://www.contracostatimes.com/ci_14366899?source=rss

It is sad that the Mexicans do not have enough pride in their own country to build it up on their own work ethic and fortitude.

It's a shame that Robles is up here illegally instead of back home protecting his family. It looks like his wfe's aunt was kidnapped for ransom because the kidnappers thought Robles had struck it rich up here and could send them $10,000.

Go home and take care of your families and build some sewer lines and weave some blankets.

They make up this stuff. Do they think we're stupid enough to believe some guy is up here while his family is being kidnapped, freezing and starving in Mexico, and if that is true, we're supposed to feel sorry for this person who abandoned his family?!