Fewer Migrants Sending Dollars Back to Latin America

May 9, 2008

The U.S. economic slowdown and negative attitudes toward undocumented immigrants could lead to a 25 percent drop in the number of people who will send money home, or remittances, to Latin America this year, the Inter-American Development Bank (IADB) said.

That projection is based on a poll carried out among 5,000 Latin American residents of the United States. The results of the survey were compared with those of a previous one conducted in 2006.

The study indicates that some 9.4 million Latin Americans living in the United States would likely send money home this year, down from 12.6 million in 2006.

Analysts at the investment fund said that as a result at least 2 million Latin American families – most of them in Mexico – would fall below the poverty line, which could translate into more illegal immigration to the United States.

At the same time, the survey revealed that those immigrants still sending funds home were remitting larger amounts, thereby compensating for the decline in the number of people transferring money.

That means the volume of remittances from the United States to Latin America will remain stable in 2008 at about $45.9 billion, in line with figures from 2006 and 2007.

Total remittances to the region in 2007, also including money sent from Europe and Japan, stood at $66.5 billion, according to IADB figures.

But the multilateral lending institution said the U.S. economic slowdown does not fully explain the drop in the number of remitters, adding that attitudes toward illegal immigration in that country also have contributed to the decline.

In that sense, 81 percent of respondents said they believe it is more difficult to find well-paid work now than in previous years.

 

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