NUMBERS, FACTS AND TRENDS SHAPING THE WORLD FOR RELEASE November 15, 213 Remittances to Latin America Recover but Not to Mexi ico FOR FURTHER INFORMATION ON THIS REPORT: D Vera Cohn, Senior Writer Ana Gonzalez-Barrera, Research Associate Danielle Cuddington, Intern Contact: Russ Oates 22.419.4372 RECOMMENDED CITATION: Cohn, D Vera, Ana Gonzalez-Barrera and Danielle Cuddington. 213. Remittances to Latin America Recover but Not to Mexico. Washington, D.C. Pew Research Center, November.
1 Remittances to Latin America Recover but Not to Mexico About This Report This report examines official flows of remittances, including overall trends from 2 to 213 as well as contributions from the U.S. in 25 and 212, with a particular focus on 17 Spanishspeaking nations in Latin America: Argentina, Bolivia, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay and Venezuela. Data also are included separately about Brazil. The data in this report, both for remittances and other economic indicators, are derived from the World Bank. Data on immigrant populations in the U.S. come from the U.S. Census Bureau s American Community Survey. This report was written by D Vera Cohn, Ana Gonzalez-Barrera and Danielle Cuddington. The authors thank Mark Hugo Lopez, Jon Cohen, Rakesh Kochhar, Jeffrey Passel and Paul Taylor for editorial guidance and data analysis and Dilip Ratha for supplying 25 data about U.S. remittances to Latin America. Anna Brown number-checked the report. Marcia Kramer was the copy editor. Find related reports from the Pew Research Center s Hispanic Trends Project online at pewresearch.org/hispanic. A Note on Terminology The terms Latino and Hispanic are used interchangeably in this report. Unless otherwise specified, references to Latin America comprise the following Spanish-speaking countries: Argentina, Bolivia, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay and Venezuela. Cuba is not included because of lack of available data. Totals for Brazil are included separately. Remittances include money sent via formal channels by migrants themselves, as well as compensation of employees working in other countries. Compensation generally accounts for a small fraction of the total. See text box on page 6 for more detail. Adults refer to those ages 18 and older.
2 About Pew Research Center Pew Research Center is a nonpartisan fact tank that informs the public about the issues, attitudes and trends shaping America and the world. It does not take policy positions. It conducts public opinion polling, demographic research, media content analysis and other empirical social science research. The center studies U.S. politics and policy views; media and journalism; internet and technology; religion and public life; Hispanic trends; global attitudes and U.S. social and demographic trends. All of the center s reports are available at. Pew Research Center is a subsidiary of The Pew Charitable Trusts. Alan Murray, President Jon Cohen, Vice President, Research Elizabeth Mueller Gross, Vice President Paul Taylor, Executive Vice President, Special Projects Andrew Kohut, Founding Director Pew Research Center 213
3 Remittances to Latin America Recover but Not to Mexico Table of Contents About This Report 1 A Note on Terminology 1 About Pew Research Center 2 Table of Contents 3 1. Overview 4 Mexico Falls, Latin America Overall Recovers 4 Remittance Patterns 6 Impact and Use of Remittances 7 Who Sends Remittances Home? 8 2. Remittance Trends 12 Countries Where Remittances Fell, but Recovered 13 Countries Where Remittances Continue to Rise 14 Countries Where Remittances Fell and Did Not Recover 15 Comparing 25 and 212 U.S. Remittances 16 Remittances and Other Economic Indicators 17 3. Sources of Remittances to Latin America 19 Remittances to Latin America from Other Countries 2 References 22 Appendix: Individual Country Trends 24
4 1. Overview Remittances to Spanish-speaking Latin American countries overall have recovered from a decline during the recent recession, with the notable exception of Mexico, according to World Bank data analyzed by the Pew Research Center. FIGURE 1 Total Remittances Received in Latin America and Mexico, 2-213 In millions, 213 U.S. dollars 4, 35, Other Latin America 3, 25, Migrants remittances to Mexico, an estimated $22 billion in 213, are 29% below their 26 peak. For all other Spanish-speaking nations overall, Latin American the 213 estimate of $31.8 billion slightly surpasses the 28 peak. 2, 15, 1, 5, 2 22 24 Mexico 26 28 21 212213 Remittances from all sources to Spanish-speaking Latin American countries have more than doubledd since 2 but remain below their peak in 27, the year in which the U.S. Great Recession began. The 213 estimated total ($53.8 billion) is 13% below 27 s $61.66 billion (in 213 U.S. dollars). The United States is the most important source of money sent home by migrants to the 17 Latin American nations as a group (including Mexico) that are the focus of this report. U.S. remittances accounted for three-quarters of the total in 212 $41 billion out of $52.9 billion, according to World Bank data. Mexico Falls, Latin America Overall Recovers Notes: Shading indicates U.S. recession. 213 are World Bank estimates. Other Latin America comprises Argentina, Bolivia, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Paraguay, Peru, Uruguay and Venezuela. Remittance flows for 25-213 use a different methodology than 2-24; for more details seee text box. Source: World Bank Annual Remittances Data Inflows, Oct. 213 http://go.worldbank.org/92x1chhd The decrease for Latin America overall was fueled by a falloff in remittances to Mexico, whichh receives more than 4% of all remittances to Latin America. If Mexico is excluded, remittance totals to Spanish-speaking Latin American countries as a whole have recovered after dropping
5 Remittances to Latin America Recover but Not to Mexico during the U.S. recession years of 27 to 29. They bounced back in most of the other individual Spanish-speaking Latin American nations with remittances of more than $5 million a year. Of the dozen other nations, seven are estimated to have higher remittances in 213 than during the U.S. recession years of 27 to 29. Remittances to Mexico peaked in 26, a year earlier than the recent high point for Spanishspeaking Latin American nations as a whole. Aside from a single-year increase in 211, they have fallen each year since then. Other countries in which 213 estimated remittance flows have not recovered from declines during the U.S. recession years of 27 to 29 are Argentina, Colombia, Costa Rica, Dominican FIGURE 2 Republic and Ecuador. However, in seven other Spanish-speaking Latin American countries, remittances either have rebounded from declines during the recession years of 27 to 29 or did not fall markedly during those years. In Bolivia, El Salvador, Guatemala and Honduras, remittances are estimated to be higher in 213 than at their peak before the recession. In Nicaragua, Paraguay and Peru, remittances did not decline and have continued to rise. The decline in remittances to Mexico nearly all of which come from the U.S. is linked to economic changes in the U.S., where one-in-ten Mexican-born people live (Passel, Cohn and Gonzalez-Barrera, 212). The U.S. housing market crash hurt Mexican immigrants for whom the construction industry is a major job source, although a World Bank analysis concludes that the housing market s link to remittance totals has weakened since 211 (World Bank, 213). Share of Latin America Remittances from Top Sending Countries, 212 % of total remittances Canada 1% Spain 8% Other 14% Another factor in the fall of remittances to Mexico could be the Source: World Bank 212 Bilateral Remittance Matrix decline in the Mexican immigrant population in the U.S. since http://go.worldbank.org/92x1chhd the onset of the recession, due to decreased arrivals and increased departures, including deportations. A Pew Research Center analysis of government data found that recent migration from the U.S. to Mexico equals and possibly exceeds migration from Mexico to the U.S. through at least 212 (Passel, Cohn and Gonzalez-Barrera, 212). U.S. 78% Notes: Latin America comprises Argentina, Bolivia, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay and Venezuela. Parts may not sum to 1% due to rounding.
6 Remittance Patterns Remittances from the U.S. to Spanish-speaking Latin American countries are concentrated in countries closest to the U.S. border. Mexico alone receives more than half $23 billion in 212. The share rises to four-fifths when three adjacent countries are added in: Guatemala ($4.4 billion), El Salvador ($3.6 billion) and Honduras ($2.6 billion). U.S. residents are the source of nearly all remittance money received in Mexico (98% in 212) and of the majority of remittancee money received in six other Spanish- speaking Latin American nations: Costa Rica, Dominicann Republic, El Salvador, Guatemala, Honduras and Panama. Remittance amounts from the U.S. are higher than any other nation to three more countries, Colombia, Peru and Venezuela. Spain, the next-largest sending nation to Spanish-spe eaking Latin American countries, contributed 8% of 212 remittances, or $4 billion. Canada, which ranked third, sent 1% of remittances to these countries, or $74 million in 212. As is true of Latin America, the U..S. also is the largest source of remittances worldwide, sending a Remittances: A Definition Remittances are funds or other assets sent to their home countries by migrants, either themselves or in the form of compensation for border, short-term and seasonal employees (World Bank, 213). Most funds come directly from migrants; compensationn accounts for a single-digit share of remittances in most Latin American nations (World Bank, 211). This change hadd a particularlyy large impact on Brazil, reducing the total remittance amounts considerably. It had less impact on other Latin American nations (World Bank, 213). The 213 estimates and the 25-213 trend data in this report employ the new definition. The 25 and 212 data on size of flows from one country to another have not been updated by the World Bank to reflect the new definition, so those may differ somewhat from trend data. When reporting trends over time in remittance flows, amounts for years before 213 are adjusted to 213 dollars, using the average U.S. inflation rate for every preceding year. For this reason, some numbers in this report differ from unadjusted data published by the World Bank. Data in this report are provided by the World Bank and follow World Bank definitions adopted from the International Monetary Fund nations (World Bank, 213). In some cases, trend analysis iss restricted to nations with more than $5 million in annual remittances, where year- to-year trends are less volatile. The World Bankk reports only remittances sent via formal channels, such as banks and other businesses that transfer money. If unofficial remittances were counted, the total could be as much as 5% higher or more, according to household surveys and other evidence cited by the World Bank (World Bank, 25). In 213, the World Bank revised its definition of remittances to delete a category of capital transfers between households. The World Bank also revised previously published numberss back to 25 to reflect the change.
7 Remittances to Latin America Recover but Not to Mexico total of $123.3 billion in 212, according to World Bank data. Saudi Arabia ($27.6 billion in 212) is next, followed by Canada ($23.9 billion). Among all countries, the largest recipient of remittances is India, with an estimated $71 billion in 213. China ranks second ($6.2 billion), followed by the Philippines ($26.1 billion). Mexico ranks fourth. Impact and Use of Remittances Remittances are a larger source of money to Latin America than official foreign aid. In 211, when foreign aid to Spanish-speaking Latin America nations totaled $6.2 billion, formal remittances were more than eight times that $53.1 billion. Foreign aid totals less than remittances in each Spanish-speaking Latin American nation except Chile and Peru. Money sent home by migrants represents a varying share of the gross domestic product throughout Spanish-speaking Latin America. The highest shares are in three Central American nations, according to the World Bank: El Salvador (16.5% in 212), Honduras (15.7%) and Guatemala (1.%). What is the impact of remittances? On the macro level, the World Bank has included remittance inflows in its measure of creditworthiness since 29, so nations with high levels of formal remittances may be allowed to borrow more money than they otherwise could. At the household level, as might be expected, those who receive remittances have higher incomes, spend more and are less likely to be extremely poor than those who do not receive remittances (Ratha, 213). TABLE 1 Remittances as a Share of GDP, 212 A significant part of remittances, often the majority, is spent on food, clothing and other day-to-day needs, according to research. Although there is variation by country, a significant, but smaller, share goes to saving and investment, especially among households that no longer include young children (Massey et al., 212). Households that receive remittances also are more likely than those that do not to spend money on health care and education (Ratha, 213). % Country Share El Salvador 16.5 Honduras 15.7 Guatemala 1. Nicaragua 9.7 Dominican Republic 6.1 Bolivia 4.1 Ecuador 2.9 Paraguay 2.5 Mexico 2. Peru 1.4 Costa Rica 1.2 Colombia 1.1 Panama 1.1 Uruguay.2 Argentina.1 Venezuela. Chile. Source: World Bank Annual Remittances Data Inflows, Oct. 213 http://go.worldbank.org/92x1chhd
8 However, research is inconclusive about the impact of remittances on a receiving nation s economy. Some studies have found that labor force participation declines in households that receive remittances, which hurts economic growth (Chami et al., 23). Other studies focused on the impact of remittances in Mexico have found that at the state level remittances improve regional labor markets by raising employment levels (Orrenius et al., 212). The average cost of sending remittances to Latin America was 7.3% in late 213, according to the World Bank, a decline from past years (World Bank, 213a). The growing role of technology, especially mobile banking and online money transfers, has made it easier to send money home (Orozco, 212). It also has made it easier, along with improved measurement methods by banks, for governments and central banks to track remittances. Lower costs, improved technology and better tracking have played a role in increasing the sum of formal remittances, and some research suggests that these factors, not fundamental economic changes, likely account for most growth in formal remittances over the TABLE 2 U.S. Share of International Emigrants and Remittances % 2s (Orrenius et al., 212) % of Emigrants % of Remittances Country in the U.S., 21 from the U.S., 212 Who Sends Remittances Home? Mexico 96 98 El Salvador 87 9 Guatemala 87 89 Remittance totals are strongly linked to the size Honduras 81 87 of a particular country s immigrant population Panama 79 72 in the U.S. and the share of its emigrants who Dominican Republic 7 78 live in the U.S. For example, the four Latin American nations that get the highest share of their remittances from the U.S. Mexico, El Salvador, Guatemala and Honduras also are the top four in terms of the share of their emigrants who live in the U.S. The Latin American nations with the lowest share of remittances from the U.S. Uruguay, Bolivia and Paraguay also have the lowest share of emigrants living in the U.S. Costa Rica Ecuador Peru Nicaragua Venezuela Colombia Argentina Chile Bolivia Uruguay 64 38 37 37 33 3 19 15 13 12 69 39 39 43 35 32 18 16 13 15 Paraguay 4 6 Most immigrants do send remittances home, and so do some people born in the U.S.; a Pew Research Center survey in 28 found that 54% of foreign-born Hispanics and 17% of U.S.-born Notes: Ranked by share of international emigrants living in the U.S. Source: Pew Research Center estimates of migrant population stocks, 21. World Bank 212 Bilateral Remittance Matrix http://go.worldbank.org/92x1chhd
9 Remittances to Latin America Recover but Not to Mexico Hispanics say they send money to their home country (Lopez, Livingston and Kochhar, 29). Some research has found that foreign-born U.S. citizens and legal permanent residents are less likely to send remittances than unauthorized immigrants who may have less attachment to the U.S. and more to their home country (Massey et al., 212). This report is based mainly on data on remittances compiled by the World Bank, including overall trends for 2 to 213 as well as country-to-country flows for 212. To add context to the remittance findings, the report also uses World Bank data on foreign aid and GNP, as well as 212 estimates from the U.S. Census Bureau s American Community Survey on the immigrant population in the U.S. from selected Latin American nations. TABLE 3 Remittances Received, 213 estimates In millions, U.S. dollars Total Country Remittances Mexico 22, Guatemala 5,412 Colombia 4,642 El Salvador 4,217 Dominican Republic 3,76 Honduras 3,165 Peru 3,12 Ecuador 2,571 Bolivia 1,26 Nicaragua 1,18 Paraguay 76 Argentina 613 Costa Rica 61 Panama 495 Venezuela 123 Uruguay 18 Chile Source: World Bank Annual Remittances Data Inflows, Oct. 213 http://go.worldbank.org/92x1chhd
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11 Remittances to Latin America Recover but Not to Mexico
12 2. Remittance Trends Overall, remittances to Spanish-speaking Latin America countries have more than doubled since 2 in real dollars. Those Latin American nations received $22.9 billion in remittances in 2, a figure that rose to an estimated $53.8 billion in 213, according to World Bank data. Looking at trends since 2, the onset of the U.S. Great Recession interrupted what had been a steady upward trend from 2 to 27. Remittances to the 17 nations that are the focus of this report peaked at $61.66 billion in 27, and then fell in each of the following threee years, to $52.6 billion in 21. Remittances rose in 211 to $ 54.2 billion,, but decreased to $53.7 billion in 212 and held steady at an estimated $ 53.8 billion in 213. Thus, in 213, overall remittances to Latin America were 13% short of their 27 peak. A decline in remittances to Mexico was the main reason for the overall decrease after 211. Overall remittances to FIGURE 3 Remittances to Mex In millions, 213 U.S. dollars 35, 3, Mexico nearly all of which come from the U.S. are estimated to total $222 billion 25, 2, in 213, according to the World Bank, compared with $1.2 billion in 2. 15, 1, Remittances to Mexico peaked at $3.8 billion in 26, a year earlier than for Latin America as a whole. 5, 2 22 24 26 Aside from a single-year increase in 211, remittances to Mexico have decreased each year since then. xico, 2-213 28 21 212213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. Source: World Bank Annual Remittances Data Inflows, Oct. 213 http://go.worldbank.org/92x1chhd PEW RESEARCH CENTER The reduced remittances to Mexico were reflected in the findings of a 28 survey byy the Pew Research Center s Hispanic Trends Project. Among Hispanic immigrants who had sent remittances in the previous two years, 71% said they sent lesss in the past year than the year before (Lopez, Livingston and Kochhar, 29). In addition, immigration from Mexico has declined to the point that the number of
13 Remittances to Latin America Recover but Not to Mexico Mexicans arriving in the U.S. could be smaller than the number who are leaving (Passel, Cohn and Gonzalez-Barrera, 212). The next four sub-sections look at trends from 2 to 213 for 12 other Spanish-speaking nations in Latin America with annual remittances of at least $5 million. Bolivia, El Salvador, Guatemala and Honduras had remittance drops during the recessionn years, but have recovered. Nicaragua, Paraguay and Peru didd not have notable declines during the recession and totals have since risen. Argentina, Colombia, Costa Rica, Dominican Republic and Ecuador, like Mexico, have not recovered from remittance declines during the recession years. Data for the remaining nations (Chile, Panama, Uruguay and Venezuela), as well as for Brazil, and charts for each nation, can be found in Appendix A. Countries Wheree Remittances Fell, but Recovered Remittances to Bolivia have risen steeply since 2 the estimated total in 213 ($1.3 billion) is more than seven times higher than in 2 ($172 million). The growth (mainly before 27) was sharper than for Latin America as a whole, and Bolivian remittances also differed from the pattern for Latin America overall by recovering from their decline during the Great Recession. Remittances to Bolivia generally rose to a peak of $1.2 billion in 28, and then declined for two years before rising again. FIGURE 4 Trends, 2-213: : Nations Where Remittances Declined and Recovered In millions, 213 U.S. dollars 6, 5, 4, 3, 2, 1, 2 Guatemala El Salvador Honduras Bolivia 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 aree World Bank estimates. Source: World Bank Annual Remittances Data Inflows, Oct. 213 http://go.worldbank.org/92x1chhd PEW RESEARCH CENTER
14 Remittances to El Salvador, whichh totaled $2..4 billion in 2, rose to $4.2 billion in 27 before drifting down and then up again. In 213, El Salvador received an estimated $4.2 billion in remittances, about equal to its peak total. El Salvador remittances are mainly from the U.S., which was the source of 9% of that country s remittances in 212. Guatemala also receives most of its remittances 89% in 212 from the U.S. Guatemalan remittances overall grew from $81 million in 2 to $4.8 billion in 28, about a sixfold increase. After declining in 29, remittances to Guatemala have risen again since then, to total an estimated $5.4 billion in 213, higher than the previous peak. Honduras, which received 87% of its remittances from thee U.S. in 212, also has recovered from a decline in remittances during the Great Recession. Honduras received $657 million in remittances in 2, which rose to a peak of $3.1 billion in 28. Remittances declined for a year before rising again; in 213, they reached an estimated $3.2 billion. FIGURE 5 Trends, 2-213: Nations Where Remittances Have Risen In millions, 213 U.S. dollars Countries Wheree Remittances Continue to Rise Remittances to Nicaragua have risen steadily since 2, with only a slight dip during the Great Recession. In 2, $435 million in remittances were sent to Nicaragua, rising to $ 891 million in 28. After a relatively small decline in 29 (to $84 million), remittances began rising again. In 213, they totaled an estimated $1.1 billion. 6, 5, 4, 3, 2, 1, 2 222 24 Peru Nicaragua 26 28 21 Paraguay 212213 Remittances to Paraguay, $378 million in 2, grew to an estimated $76 million in 213, according to World Bank data. Notes: Shading indicates U.S. recession. Dashed line indicates a change in methodology that significantly affected the trend. 213 are World Bank estimates. Source: World Bank Annual Remittances Data Inflows, Oct. 213 http://go.worldbank.org/92x1chhd
15 Remittances to Latin America Recover but Not to Mexico Remittances declined or stayed about the same from 21 to 25 (although a change in World Bank methodology could have affected the trend; see textt box on page 6). Remittances grew in 26 and leveled off or grew slowly through 21. Remittances grew rapidly after that; the estimated total of $76 million for 213 is 73% higher than it was in 21. In Peru, overall remittances grew from $975 million in 2 to an estimated $3 billion in 213. Remittances were relatively level from 2 to 22, grew to $2.7 billion in 28, and remained level or grew through 213. Countries Wheree Remittances Felll and Did Not Recover In millions, 213 U.S. dollars Over the 2-213 period, remittances to Argentina peaked 6, in 28, at $758 million, after rising each year beforee that, 5, according to World Bank data. Colombia Since then, totals have been up and down. In 213, estimated 4, Dominican Republic remittances of $613 million were about a fifth lower than at their recent peak but more than five times what they had been in 2 ($117 million). 3, 2, 1, Ecuador Argentina Remittances to Colombia have followed a jagged pattern of rise Costa Rica and fall since 2, when they totaled $2.2 billion. They rose 2 22 24 26 28 21 212213 from 2 to 23 and leveled off for two years before rising to a peak of $5.3 billion in 28. Remittances to Colombia declinedd FIGURE 6 Trends, 2-213: Nations Where Remittances Fell and Have Not Recovered Notes: Shading indicates U.S. recession. 213 is World Bank estimate. Source: World Bank Annual Remittances Data Inflows, Oct. 213 http://go.worldbank.org/92x1chhd or leveled off from 29 to 212 before rising again to an estimated $4.6 billion in 213. As explained in the next section, besides the U.S.., a notable share of remittances to Colombia come from Venezuela and Spain, two economies that are still struggling.
16 Remittances to Costa Rica, about two-thirds of which come from the U.S., rose sharply from 2 ($185 million) to 27 ($697 million). Remittance totals fell or leveled off after that until resuming their upward climb in 212. In 213, Bolivia received an estimated $61 million in remittances. In the Dominican Republic, which receives three-quarters of its remittances from the U.S., money sent home by migrants has grown by about half since 2, when it totaled $2.5 billion. Remittances peaked at $3.9 billion in 28, and have been up and down somewhat since then. In 213, the Dominican Republic received an estimated $3.7 billion in remittances. Remittances to Ecuador totaled $1.8 billion in 2, then rose to a peak of $3.8 billion in 27 before falling or leveling off. In 213, Ecuador received an estimated $2.6 billion in remittances, about a third lower than its peak total. Spain is the main contributor of remittances to Ecuador, followed by the U.S. Comparing 25 and 212 U.S. Remittances Although yearly data showing U.S. remittances to Latin American nations has not been published, the Pew Research Center analyzed an unpublished World Bank database of U.S. remittances in 25, two years before the start of the Great Recession. A comparison of 25 to 212 U.S. remittances shows that the total sent to Spanish-speaking Latin American nations rose 1% over the period in real terms, from $37.3 billion in 25 to $41 billion in 212. However, the change varied greatly among individual nations. U.S. remittances to Mexico the largest destination country declined slightly (3%) in real terms, from $23.6 billion in 25 to $22.8 billion in 212. Remittances to Colombia fell 18% in real dollars from 25 to 212. However, among other countries with total remittances of $5 million or more, all had doubledigit percentage increases in remittance growth from the U.S. since 25. In three countries, the amount more than doubled: Bolivia (135%), Paraguay (119%) and Honduras (115%). U.S. remittances to Panama, which received 72% of its remittances from the U.S. in 212, also grew sharply by 181% between 25 and 212. As a result of these differing trajectories, there were changes in rank among the top 1 recipients of U.S. remittances. Honduras received more remittances in 212 than Colombia, the reverse of their positions in 25. Similarly, Peru received somewhat more than Ecuador in 212 remittances, a reversal from 25.
17 Remittances to Latin America Recover but Not to Mexico Remittances and Other Economic Indicators Remittances are an important contributor to the economies of some Latin American nations. In 212, according to World Bank data, remittances accounted for about 1% or more of GDP in four nations: El Salvador (16.5%), Honduras (15.7%), Guatemala (1%) and Nicaragua (9.7%). However, for most Latin American nations, remittances make up a far smaller share of GDP. In 212, they amounted to less than 1% of GDP in Argentina, Chile, Uruguay and Venezuela. According to the World Bank (World Bank, 213), remittances worldwide amount to nearly three times the size of foreign aid, or official development assistance. In Spanishspeaking Latin America, according to World Bank data for 211 (the latest available), remittances ($53.1 billion) amount to more than eight times the total of foreign aid to the region ($6.2 billion). The size of the difference between remittances and foreign aid varies by nation. Remittances are about 34 times the amount of foreign aid in Nicaragua, and about 1 times or more foreign aid in Costa Rica, Dominican Republic, Ecuador and El Salvador. At the other end of the scale, remittances are less than twice foreign aid in Bolivia. In Chile and Peru, remittances are less than foreign aid. The total amount of remittances sent to each Latin American country from the U.S. is linked to the size of each country s foreign-born adult population in the U.S. Likewise, the share of remittances to each country that comes from the U.S. is closely linked to the share of that nation s emigrants who live in the U.S. TABLE 4 Total Remittances from the U.S. per Immigrant Adult Living in the U.S., 212 Adult Total immigrants remittances Remittances per capita (thousands) (millions) (dollars / adult immigrant) Guatemala 792 4,4 5,558 Honduras 493 2,579 5,231 Costa Rica 73 361 4,923 Brazil 33 1,36 4,311 Panama 12 34 3,353 Dominican Republic 888 2,732 3,76 El Salvador 1,21 3,555 2,939 Peru 41 1,91 2,721 Ecuador 42 1,47 2,67 Mexico 1,786 22,811 2,115 Colombia 635 1,33 2,94 Bolivia 67 13 1,94 Nicaragua 251 43 1,71 Argentina 166 15 63 Uruguay 42 15 348 Venezuela 177 44 251 Chile 82 1 6 Notes: Ranked by remittances per capita from the U.S. Adult immigrant population data not available for Paraguay. Source: Pew Research Center estimates based on U.S. Census Bureau 212 American Community Survey and World Bank 212 Bilateral Remittance Matrix http://go.worldbank.org/92x1chhd
18 Mexico, with by far the largest adult population in the U.S. (1.8 million in 212) received the largest total remittances. 1 Guatemala, fourth-ranked in adult population, ranked second in total remittances. The Dominican Republic, third-ranked in adult population in the U.S., was the fourth-largest remittance recipient in 212. However, the per capita amount of remittance sent home has less to do with population size in the U.S. Although Mexicans send home the largest total of remittances, they ranked ninth among 16 Spanish-speaking Latin American nations in remittances per capita in 212. Similarly, Colombia ranked fifth in adult population size in 212 but 1th in per capita remittances. Meanwhile, Costa Rica ranked 15th in adult population size in 212 but third in per capita remittances. Guatemala, fourth-ranked in adult population size, sent home the highest per capita remittances in 212. Honduras, ranked sixth for adult population, sent home the second-highest per capita remittance. 1 For this analysis, the adult population ages 18 and older, rather than total population, is used in order to focus on the potential pool of remittance senders.
19 Remittances to Latin America Recover but Not to Mexico 3. Sources of Remittances to Latin America The United States is the single largest source of remittances to Spanish-speaking Latin America, accounting for $41 billion of the $52.9 billion in money sent home by migrants in 212. Funds transferred to Latin America account for a third (33%) of remittances from the U.S., according to World Bank data analyzed by the Pew Research Center. FIGURE 7 Percentage of Total Country Remittances from U.S., 212 % Mexico % from U.S. % Other 98 2 Although about three-quarters (78%) of all remittances to Spanish-speaking Latin El Salvador Guatemala 9 89 1 11 American countries come from the U.S., the share varies widely from country to country. In Mexico, 98% of remittances are sent from the U.S.; in Paraguay, 6% are. Mexico also towers Honduras Dominican Republic Latin America 87 78 78 13 22 22 over other Latin American countries in the amount of U.S. remittances it receives: $22.8 billion in 212, accounting for more than half of money transferred to the region from the Panama Costa Rica Nicaragua 43 72 69 28 31 57 U.S. The nation with the next highest Ecuador 39 61 amount Guatemala received $4.4 billion. Peru 39 61 Of the 17 Spanish-speaking countries that are Venezuela 35 65 the focus of this report, the U.S. is the main Colombia 32 68 source of remittances to seven. In addition to Mexico, the U.S. is the source of the majority f remittance money received in El Salvador, Argentina Chile 18 16 82 84 Guatemala, Honduras, Dominican Republic, Uruguay 15 85 Panama and Costa Rica, in order of share from the U.S. It is the largest sending country of remittances to Peru, Colombia and Venezuela. Bolivia Paraguay 13 6 87 94 Spain sends more than the U.S. in remittances to Argentina, Bolivia, Ecuador, Paraguay and Uruguay. Source: World Bank 212 Bilateral Remittance Matrix http://go.worldbank.org/92x1chhd
2 Remittances to Latin America from Other Countries In terms of total remittances to Latin America, Spain, which sent $4 billion and supplied 8% of remittances, ranked second to the U.S. in 212. Canada, which sent $74 million and supplied 1% of remittances, ranked third. The countries with the highest shares of remittances from Spain are Ecuador (44%) and Bolivia (42%). Spain also supplies about a third of the remittances to Argentina (35%) and Venezuela (31%) and more than a quarter of remittances to Uruguay (29%). In terms of dollars, Spain also contributed more to Ecuador than to any other Latin American nation ($1.2 billion). The other top destination countries in 212 weree Colombia ($751 million), Peru ($472 million), Bolivia ($431 million) and Dominican Republic ($417 million). Remittances to Brazil Remittances to Brazil are estimated at $2.8 billion in 213, according to World Bank figures. This reflects a sharp reduction from $4.9 billion in 212, but the change is due mainly to a revised definition of remittances that removed a category of capital transfers between households (see text box on page 6). The World Bank has adjusted remittance totals to Brazil from 25 onward to reflect the new definition. Looking at trends from 25 to 213, remittances to Brazil peaked at $4 billion in 28. Remittances declined from 29 ($3.1 billion) to 212 ($2.6 billion). Remittances to Brazil in 213 are estimated at $2.8 billion. However, a number of Latin American nations Brazil receives about a quarter of its remittances from the U.S. (26% in receive a notable share of remittance funds from 212). countries other than the U.S. or Spain. Among the 14 Spanish-speaking Latin American nations with $5 Additional data about remittances to million or more in 212 remittances, six Argentina, Brazil can be found in Appendix A. Bolivia, Colombia, Nicaragua, Paraguay and Peru received more than 4% of those dollars from countries other than the U.S. or Spain. Other countries within Latin America are among the other major sources off remittances; for example Venezuela is the second-largest source of remittances to Colombia, after the U.S. Argentina, which received 47% of its $573 million in 2122 remittances from nations other than the U.S. or Spain, did not receive a notably large share from any nation other than those two. In 212, Bolivia received 45% of its $1 billion in remittances from nations other than the U.S. or Spain. Spain ($431 million) contributed the largest amount, followed by Argentina ($31 million) and the U.S. ($13 million).
21 Remittances to Latin America Recover but Not to Mexico The U.S. was the largest contributor ($1.3 billion) in 212 to Colombia s $4.1 billion in remittances, followed by Venezuela ($1.1 billion) and Spain ($751 million). Colombia received half (49%) of its remittances from nations other than the U.S. or Spain in 212. FIGURE 8 Percentage of Total Country Remittances from Spain, 212 % % from Spain % Other Nicaragua received $1 billion in remittances in 212, 56% of it from nations other than the U.S. or Spain. Costa Rica ($444 million) was Ecuador Bolivia 44 42 56 58 the largest source of remittances to Nicaragua in 212, followed by the U.S. ($43 million) and Spain ($18 million). Argentina Venezuela 35 31 65 69 Paraguay received $872 million in remittances in 212; 59% of that amount ($512 million) Uruguay Colombia 18 29 71 82 came from Argentina. Paraguay 17 83 Peru received 44% of its $2.8 billion in 212 Peru 17 83 remittances from nations other than the U.S. or Spain. The U.S. ($1.1 billion) and Spain ($472 million) were the top source countries, Chile Dominican Republic 12 12 88 88 followed by Italy ($236 million). Latin America 8 92 Honduras 4 96 Panama 3 97 Costa Rica 3 97 Nicaragua 2 98 Guatemala 1 99 El Salvador 1 99 Mexico 1 Source: World Bank 212 Bilateral Remittance Matrix http://go.worldbank.org/92x1chhd
22 References Chami, Ralph, Connel Fullenkamp and Samir Jahjah. 23. Are Remittance Flows a Source of Capital for Development? International Monetary Fund Working Paper 3/189. Washington, DC: International Monetary Fund. http://www.imf.org/external/pubs/ft/wp/23/wp3189.pdf Connor, Phillip. 212. Faith on the Move: The Religious Affiliation of International Migrants. Washington, DC: Pew Research Center s Religion & Public Life Project, March. http://www.pewforum.org/212/3/8/religious-migration-exec/ International Monetary Fund. 211. Balance of Payments and International Investment Position Manual, Sixth edition. Washington, DC. http://www.imf.org/external/pubs/ft/bop/27/bopman6.htm Lopez, Mark Hugo, Gretchen Livingston and Rakesh Kochhar. 29. Hispanics and the Economic Downturn: Housing Woes and Remittance Cuts. Washington, DC: Pew Research Center s Hispanic Trends Project, January. http://www.pewhispanic.org/29/1/8/hispanicsand-the-economic-downturn-housing-woes-and-remittance-cuts/ Massey, Douglas S., Jorge Durand and Karen A. Pren. 212. Migradollars in Latin America: A Comparative Analysis. Chapter 12 in Migration and Remittances from Mexico: Trends, Impacts and New Challenges. Alfredo Cuecuecha and Carla Pederzini, eds. Lanham, MD: Lexington Books. Orozco, Manuel. 212. Future Trends in Remittances to Latin America and the Caribbean. Washington, DC: Inter-American Dialogue, May. http://www.thedialogue.org/publicationfiles/iad8642_remittance_424enfinal.pdf Orrenius, Pia M., Madeline Zavodny, Jesus Canas and Roberto Coronado. 212. Remittances as an Economic Development Engine: Regional Evidence from Mexico. Chapter 1 in Migration and Remittances from Mexico: Trends, Impacts and New Challenges. Alfredo Cuecuecha and Carla Pederzini, eds. Lanham, MD: Lexington Books. Passel, Jeffrey, D Vera Cohn, and Ana Gonzalez-Barrera. 212. Net Migration from Mexico Falls to Zero and Perhaps Less. Washington, DC: Pew Research Center s Hispanic Trends Project, April. http://www.pewhispanic.org/212/4/23/net-migration-from-mexicofalls-to-zero-and-perhaps-less/
23 Remittances to Latin America Recover but Not to Mexico Ratha, Dilip. 213. The Impact of Remittances on Economic Growth and Poverty Reduction. Washington, DC: Migration Policy Institute, September. http://www.migrationpolicy.org/pubs/remittances-povertyreduction.pdf World Bank. 211. Migration and Remittances Factbook 211. Washington, DC: World Bank. http://siteresources.worldbank.org/intlac/resources/factbook211-ebook.pdf World Bank. 25. Global Economic Prospects 26: Economic Implications of Remittances and Migration. Washington, DC: World Bank. http://documents.worldbank.org/curated/en/25/11/6413332/global-economicprospects-26-economic-implications-remittances-migration World Bank. 213. Migration and Remittance Flows: Recent Trends and Outlook: 213-216. Washington, DC: World Bank, October. http://siteresources.worldbank.org/intprospects/resources/334934-12889976745/migrationanddevelopmentbrief21.pdf World Bank, 213a. Remittance Prices Worldwide. Washington, DC: World Bank, September. https://remittanceprices.worldbank.org/sites/default/files/rpw_report_sep213.pdf
24 Appendix: Individual Country Trends FIGURE A.1 Remittances Received by Argentina Selected Facts, 213 World rank Latin America rank 613 93 12 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of Argentina s GDP 573.1 3, Total from the U.S. (in millions) 15 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 18 63 1, 2 22 24 26 28 21 212 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
25 Remittances to Latin America Recover but Not to Mexico FIGURE A.2 Remittances Received by Bolivia Selected Facts, 213 World rank Latin America rank 1,26 74 9 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of Bolivia s GDP 1,19 4.1 3, Total from the U.S. (in millions) 13 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 13 1,94 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
26 FIGURE A.3 Remittances Received by Chile Selected Facts, 213 World rank Latin America rank 167 17 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of Chile s GDP 3. 3, Total from the U.S. (in millions) 1 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 16 6 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. World Bank 213 estimate for Chile is zero; 212 estimate is $3 million. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
27 Remittances to Latin America Recover but Not to Mexico FIGURE A.4 Remittances Received by Colombia Selected Facts, 213 World rank Latin America rank 4,642 27 3 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of Colombia s GDP 4,11 1.1 3, Total from the U.S. (in millions) 1,33 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 32 2,94 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
28 FIGURE A.5 Remittances Received by Costa Rica Selected Facts, 213 World rank Latin America rank 61 94 13 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6 5 Selected Facts, 212 4 % of Costa Rica s GDP 522 1.2 3 Total from the U.S. (in millions) 361 2 % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 69 4,923 1 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
29 Remittances to Latin America Recover but Not to Mexico FIGURE A.6 Remittances Received by Dominican Republic Selected Facts, 213 World rank Latin America rank 3,76 32 5 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, 3,55 % of Dominican Republic s GDP Total from the U.S. (in millions) 6.1 2,732 3, 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 78 3,76 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
3 FIGURE A.7 Remittances Received by Ecuador Selected Facts, 213 World rank Latin America rank 2,571 41 8 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of Ecuador s GDP 2,682 2.9 3, Total from the U.S. (in millions) 1,47 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 39 2,67 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
31 Remittances to Latin America Recover but Not to Mexico FIGURE A.8 Remittances Received by El Salvador Selected Facts, 213 World rank Latin America rank 4,217 28 4 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of El Salvador s GDP 3,965 16.5 3, Total from the U.S. (in millions) 3,555 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 9 2,939 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
32 FIGURE A.9 Remittances Received by Guatemala Selected Facts, 213 World rank Latin America rank 5,412 24 2 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of Guatemala s GDP 4,922 1. 3, Total from the U.S. (in millions) 4,4 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 89 5,558 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD
33 Remittances to Latin America Recover but Not to Mexico FIGURE A.1 Remittances Received by Honduras Selected Facts, 213 World rank Latin America rank 3,165 36 6 Total Remittances Received, 2-213 (in millions, 213 U.S. dollars) 6, 5, Selected Facts, 212 4, % of Honduras s GDP 2,971 15.7 3, Total from the U.S. (in millions) 2,579 2, % of total from the U.S. Remittances per capita from the U.S. (dollars / adult immigrant) 87 5,231 1, 2 22 24 26 28 21 2122 213 Notes: Shading indicates U.S. recession. 213 is World Bank estimate. 212 factss are based on 212 World Bank data that used a different remittance methodology than more recent data used for 213 facts and trend chart. Source: All remittance and GDP data from World Bank. Trends, 213 total, rankings and 212 share of GDP from 213 Annual Remittances Data Inflows, Oct. 213; 212 totals, U.S. totals and U.S. share from 212 Bilateral Remittance Matrix; adult immigrant population from Pew Research Center estimates based on 212 American Community Survey. http://go.worldbank.org/ /92X1CHHD