Growth of remittances to Latin America slowed in 2007
( dpa )- Remittances sent to Latin America by expatriates around the world reached 66.5 billion dollars in 2007, but grew at a slower pace than in previous years, the Inter-American Development Bank (IDB) said Tuesday in a report.
The figure increased only 7 per cent over the previous year. Since the reports were first published in 2000, there had alway been double-digit annual rises.
Mexico and Brazil led the slow-down - Mexico received nearly 24 billion dollars, just 1 per cent more than in 2006, and Brazil got barely 7.1 billion, 4 per cent less than the previous year.
Donald Terry, manager of the IDB's Multilateral Investment Fund, said the figures are bad news for Mexico and good news for Brazil.
The IDB believes some 600,000 Mexican families stopped getting money from abroad in 2007, mainly over fears that migration regulations may get tougher in the United States and over the slow- down of the US economy. Some 11-20 million Mexicans are estimated to live in the United States.
According to the Mexican Central Bank, the trend is being reinforced, and in January 2008 remittances went down by 6 per cent.
However, the IDB was puzzled that there was not a similar trend for other Latin American countries. Although similar numbers of Mexicans and Central Americans work in construction in the United States, no similar effect was felt in remittances to Central America.
In the case of Brazil, the reduction in remittances is positive because it is based on the progress of the Brazilian economy. Workers feel less need to leave the country, and many are actually returning, Terry explained.
Colombia came in third in money received from its expatriates, with some 4.5 billion dollars, ahead of Guatemala (4.1 billion), El Salvador (3.7 billion), the Dominican Republic (3.1 billion), Ecuador (just under 3.1 billion) and Peru (2.9 billion).
For Andean countries, Terry noted that remittances from Western Europe, particularly Spain, already match those from the United States in volume.
For some countries, remittances are a fundamental part of income. Seven countries in Latin America and the Caribbean get more than 12 per cent of their gross domestic product (GDP) from abroad: Guyana (43 per cent), Haiti (35 per cent), Honduras (25 per cent), El Salvador (18 per cent), Jamaica (18 per cent), Nicaragua (17 per cent) and Guatemala (12 per cent).