Thread: Surge in Remittances From US to Latin America

Surge in Remittances From US to Latin America
October 21, 2006

For decades, many immigrants to the United States, both legal and illegal, have sent money to relatives in their countries of birth. A recent study shows remittances from Latin American immigrants up 50 percent over the last two years. For many countries in Latin America, remittances constitute an economic lifeline that experts believe could promote greater development in the region.
US dollars

For every immigrant, the decision to send money to needy relatives in their native lands is a personal one. But the collective impact of remittances to Latin America is growing ever-larger, according to Luis Moreno, head of the Inter-American Development Bank.

“This year Latin America will receive around $60 billion from its ex-patriots around the world,” said Luis Moreno. “About $45 billion of that total will come from the United States, up from $30 billion in 2004.”

A study commissioned by the IDB estimates more than $13 billion will have been sent this year from California, more than $5 billion from Texas, and more than $3 billion each from New York and Florida. The study also shows significant growth in remittances from U.S. states that historically have not had large Hispanic populations, revealing the emerging demographic diversity of the Latin American immigrant community in the United States.

According to the study, 73 percent of Hispanic immigrants send remittances, on average once a month. The average amount is $300. The top recipients are Mexico, at more than $20 billion, followed by Brazil, Colombia, Guatemala, El Salvador, the Dominican Republic, and Peru. Remittances to Cuba were not included in the study.

For some countries, money received from the United States and elsewhere constitutes their single largest source of income, eclipsing World Bank and IMF loans as well as foreign assistance.

But is this good news? Luis Moreno says remittances are a mixed blessing.

“We are not celebrating the fact that remittances from Latin America continue to increase,” he said. “These flows show that our region is still far from generating enough good jobs and opportunities for all its young people to prosper at home.”

Data for the study was compiled through surveys of Hispanic immigrant communities across the United States. Lead researcher Sergio Bendixen says most respondents said they were unemployed before coming to the United States, and that those who had work in their home countries were struggling to survive.

“The were making $100, $150, $200 a month,” said Sergio Bendixen. “All of a sudden they come to the United States. They get a job within two weeks, a month. And they are making five times, six times, ten times the amount of money [they earned in their home countries]. Very easy to understand what the magnet is [drawing Latin American immigrants].”

And the trend is likely to continue, according the IDB’s manager for multilateral investments, Donald Terry, who noted the United States recently observed the passing of the 300 million mark in population.

“The United States government projects that, of the next 100 million people to live and work in the United States, 40 million will come from outside of the United States,” said Donald Terry. “They will be immigrants.”

The costs and benefits of immigration are being fiercely debated in the United States, with some advocating strict measures to keep illegal immigrants out of the country, and to penalize - or deport - those who are already here. Among the arguments heard is that immigrants take jobs from native-born Americans, sap social services, and ship the money they earn out of the country rather than spending it in the United States.

IDB President Luis Moreno says there are many myths to dispel in the immigration debate, and the economic benefits of immigration should not be overlooked.

“The new report shows that around 90 percent of the money earned by Latin American immigrants remains in this country, contributing to the local economies,” he said. “Members of this young, foreign-born workforce are ready and willing to move to wherever jobs are, giving the U.S. economy an edge of flexibility no other industrialized nation can match.”

Moreno says the IDB is searching for ways to channel and leverage the inflow of remittance money to Latin American nations in such a way that promotes economic development. He says, ultimately, the goal is to have vibrant, expanding economies in Latin America that generate good-paying jobs for their citizens, reducing the impetus for remittances in the first place.

source: voa

http://mensnewsdaily.com/2006/10/21/sur ... n-america/

I posted something similar this earlier this week. As I mentioned when I posted it, the only people in the U.S. making money off them are businesses like western union.