Remittances to Caribbean in 2011 continues on growing path
By Tony Best
Remittances to Caribbean in 2011 continued on growth path, Caricom countries received about $ 5 billion; Haitians led the way for first time, outpacing Jamaicans; Caribbean immigrants are a reliable source of foreign exchange.
At time when Caricom states are reeling under the weight of a mountain of debt and large fiscal deficits and foreign investment flows are stuck below the levels of the halcyon days of the first eight years of the 21st century, West Indians living in North America and Britain sent back at least $ 5 billion in remittances to their families last year.
According to the Multilateral Investment Fund, MIF, an arm of the Inter-American Development Bank in Washington, Haitians and Jamaicans topped the list of members of the Caribbean Diaspora who remitted the largest sums to their respective homelands. And for the first time, Haitians surpassed Jamaicans, albeit by a small margin, by sending back the largest single amount of funds to their families.
In a report on remittances, the MIF stated that in 2011, Haitians remitted $2.057 billion, followed by Jamaicans $2.025 billion and Guyanese $ 401 million. Next were Trinidadians with $131 million; Surinamese $ 114 million; and Belizeans $107 million. The MIF didn’t publish remittance figures for Barbadians, Bahamians, Antiguans, Grenadians, St. Lucians, Vincentians, Kittians and Dominicans. In prior years their combined annual remittances amounted to at least $700 million.
Immigrants from the Dominican Republic, stated the MIF, sent $3.13 billion to their birthplace last year, the largest flow of funds to Spanish, English or Creole-speaking Caribbean nations.
“The importance of these flows lies in the vital role they play for millions of recipient families that depend on remittances for basic needs, even in countries with higher GDP (gross domestic product) levels,” was the way the Fund summarized the situation. “In the absence of this regular resource of income that these families receive from their family members abroad, many would fall below the poverty line.”
The Fund pointed out that in 2011:
• Caribbean and Latin American migrants sent $61 billion to their home countries last year, a six per cent increase over the $57. 6 billion remitted in 2010.
• Mexican migrants remitted almost $23 billion, the largest single amount for the entire Caribbean and Latin American region.
• Migrants living in the U.S. were the source of 75 per cent of the remittances to the Caribbean and Latin America.
• Uncertain economic prospects in Europe led to a drop in remittance flows to Latin America in the fourth quarter of last year. For instance, the migrant population in Spain, a country that’s experiencing tough economies times, shrank by as much as two per cent.
• Of the Latin American states, Brazil was alone in registering a decline, falling by five per cent to $2 billion.
• As unemployment declined in the United States, West Indians and Latin Americans sent more money to their families back home.
• Currency fluctuations and inflation affected the value of the remittances. For instance, Although Mexican migrants remitted $22.7 billion, when adjusted for inflation and currency variation were valued at more in pesos but in Brazil the value of the money dropped by 17 per cent when expressed in real’s, the Brazilian currency.
• For many Western Hemisphere states, including Jamaica, Haiti, the Dominican Republic, El Salvador, Guatemala, and Guyana remittances were a major source of income. In Jamaica, for instance, remittances remained the largest single source of foreign exchange. That was also the case in Haiti, which is trying to recover from the devastating earthquake of 2010.
• The average cost of remitting funds to the region declined by 5-7 per cent, falling by 75 per cent since the turn of the century.
• An estimated 250 million separate money transfers were recorded to the Caribbean and Latin America last year.
• The growth in remittances in 2011 confirmed an upward trend that began the year before, after the double digit drop in 2009.
• Almost every country in the Caribbean and Latin America received a greater dollar amount than the previous year.
• In a large number of Caribbean states, the sums far exceeded the amount received in foreign aid and foreign direct investment.
• Remittances to Haiti account for more than 10 per cent of the country’s GDP. The $ 2.05 billion sent back represented more than a quarter of the country’s GDP.
• Mexicans aside, migrants from Central America –Guatemala $4.37 billion; El Salvador $3.6 billion; Nicaragua $ 1.053 billion; Panama $592 million; and Costa Ricans $530 million – remitted almost $ 11 billion.
“For the remittance market of Latin American and the Caribbean, 2011 was a year of renewed growth, after the double digit drop recorded in 2009,” stated the MIF.