Habla Blog

Remittances, or the money that immigrants send back to other countries, have declined for the first time this year. According to the Washington Post, “in January, the cash transfers, known as remittances, sagged almost 7 percent compared with a year earlier, the steepest monthly dip in at least 13 years, according to Mexican government statistics.”

The downturn in the housing market and the weak dollar are affecting families in Mexico and other Latin American countries. The article goes on to say, “the drop-off in remittances to Mexico, which economists believe could accelerate this summer if the U.S. economy continues to falter, is swelling into a catastrophe here in the central Mexican state of Zacatecas, which has Mexico’s highest migration rate. Hit with particular ferocity are small villages that have been virtually abandoned by all but the elderly parents of migrants.” Remittances reached a peak in 2007 to $24 billion, because some of the fees were removed, making it more affordable to transfer and receive funds.

According to the Yuma Sun, “remittances also could be affected by a crackdown in some states, including Arizona, on those who employ illegal immigrants. A 2007 InterAmerican Development Bank study found that 82 percent of Mexican citizens living legally or illegally in the United States think it is now more difficult for a Latin American immigrant to get a good-paying job in the United States than it used to be. Of those who said it was more difficult, 45 percent attributed the change to immigration laws that require workers to show employers documents proving they are in the country legally.” And, in 2005 the Banco de Mexico and the Federal Reserve developed a Direct to Mexico program to help ease the transfer of money to Mexico. The program helps financial institutions implement policies and procedures to assist Latin American clients.