posted on August 19, 2007 08:49:40 PM new
This is huge, considering remittances have more than doubled in size since 2000 with no end in sight.
Migrant Cash Is World Economic Giant
Sunday August 19, 12:13 am ET
By William J. Kole, Associated Press Writer
Mass Migration Throughout World Spawns Underground Economy of Staggering Proportions
TIRANA, Albania (AP) -- Josif Poro pats his new sofa, points with pride to his carpets and runs a wrinkled hand over a gleaming white refrigerator. He and his wife barely scrape by on their $220 monthly pension. They'd have to do without many of the items in their cramped apartment if their son, a factory worker in Greece, didn't faithfully send home part of his earnings.
"We call him our golden boy," said Poro, 83, a retired textile mill worker.
Around the world, millions of immigrants are sending billions of dollars back home.
One sweaty wad of bills or $200 Western Union moneygram at a time, they form what could be called Immigration, Inc. -- one of the biggest businesses on the planet.
Experts tracking the phenomenon told The Associated Press they have gotten a much clearer picture since the 9/11 attacks, when authorities trying to cut the flow of cash to jihadists began taking a harder look at how immigrants move their money around.
Mass migration, they say, has spawned an underground economy of staggering proportions.
Globally, remittances -- the cash that immigrants send home -- totaled nearly $276 billion in 2006, the World Bank says. Remittances have more than doubled since 2000, and with globalization increasing the numbers of people on the move, there's no end in sight.
If these guest workers incorporated as a company, their migrant multinational would rank No. 3 on the Fortune 500 list, trailing only Wal-Mart and Exxon Mobil in annual revenue.
Remittances "are larger than direct foreign investment in Mexico, tea exports in Sri Lanka, tourism revenue in Morocco, and revenue from the Suez Canal in Egypt," World Bank economist Dilip Ratha said in a recent report.
And unlike the conventional economy, more cash tends to change hands in an economic downturn, political crisis, natural disaster, famine or war.
Counterterrorism officials say al-Qaida and other groups are financed in part through informal money transfer networks called hawalas. Governments and the International Monetary Fund have been working to regulate those.
There are other downsides: fears of brain drains and a vast permanent army of economic exiles, and the untaxed earnings flowing out of host nations.
The U.S. lost $41.1 billion in 2005, according to the World Bank, while Switzerland watched $13.2 billion trickle out of the country that year.
But Giuseppina Iampietro, a Swiss Economics Ministry spokeswoman, says little can be done: "Immigrants have no obligation to invest their money in Switzerland."
Meanwhile, from Poland to the Philippines, remittances are throwing lifelines to families combating poverty and helping to keep some national economies afloat:
-- Across Latin America, remittances hit $62 billion last year and are projected to top $100 billion by 2010, the Inter-American Development Bank says. Mexicans wire home the most cash -- nearly $22 billion -- most of it earned in the U.S.
-- India is the world leader in remittances, taking in $23.7 billion in 2005 and an estimated $26.9 billion last year, the World Bank says. Western Union, traditionally one of the most frequently tapped money transfer companies, says its share of Indian transactions has grown at least 90 percent over each of the past six quarters.
-- Immigrants from Albania, one of Europe's poorest countries, will send more than $1.3 billion back to their homeland this year. That's 13 percent of Albania's GDP and enough to finance half the trade deficit.
NAM, News Feature, , Ami Bonilla, Posted: Aug 09, 2007
Editor’s Note: Remittances are the second biggest source of foreign exchange for Mexico after oil exports, but in the first six months of 2007, the rate of growth for remittances slowed to a trickle compared to previous years. A new study of remittances to Mexico, Latin and Central America conducted by Bendixen and Associates for Inter-American Development Bank tries to uncover the reasons for the decline.
Spanish language newspapers report that money being sent back to Mexico has decreased in the last few months. This news concerns many, considering that remittances to Latin America account for more aid than the combined amount of foreign direct investment, and Mexico is the number one recipient.
Al Dia, a Spanish language daily in Dallas, Texas, reported that economic analysts are citing several factors as the explanation for this decrease, including less migration from Mexico to the United States, lack of jobs in the construction industry, and other troubles in the U.S. economy. However, Bendixen and Associates just released a study commissioned by the Inter-American Development Bank that links the drop in remittances to the combination of mounting economic difficulty and the crackdown on immigrants in specific states.
In the last few years, rate increases for remittances to Mexico have been around 20 percent. Based on the newly released study, compiled from 900 interviews in June 2007 with immigrants from Mexico and Central America, it is estimated that the increase for 2007 will be only 1 percent.
Sergio Bendixen, president of Bendixen and Associates, attributes this drastic change to the hostile environment that immigrants in “new destination states” are facing. New destination states have a lower percentage of immigrants compared to “traditional” states such as California, New York, Florida, and Texas. The survey found that there has been no significant change in the remittance patterns of Mexican immigrants in traditional states. The study also noted that there has been no change in remittance patterns among Central-American immigrants, as the majority reside in traditional states.
“In the destination states, life is a lot more difficult for immigrants than in Los Angeles, San Francisco, or Phoenix,” Bendixen said. “When people aren’t treating you well and you feel threatened and afraid, you hang on to your money because you never know when you will have to leave.”
Anti-immigration sentiment in the United States appears to be on the rise as local governments, frustrated with Congress’ inability to address the issue of undocumented immigrants, have begun to implement their own enforcement measures. These legislative measures, such as the ones passed in Hazleton, Pa., Green Bay, Wis., and Beaufort County, S.C., are making it difficult for immigrants to find good paying jobs by threatening businesses that hire undocumented immigrants with fines and suspension of licenses.
These laws have a serious impact on the Latino immigrant community, whose members usually come to the United States seeking better job conditions and salaries in order to better help their families back home.
According to the Bendixen and Associates study, when asked whether it was easier, or more difficult now, compared to a year ago, for a Latin-American immigrant to get a good paying job in the United States, 82 percent of Mexican immigrants responded that it was more difficult. When asked why they thought it was more difficult, 45 percent of respondents said immigration laws (documents required) was the problem, while 21 percent said there were not enough jobs.
When asked what was currently the biggest problem for them and their families in the United States, 30 percent of Mexican respondents said it was discrimination against immigrants and 24 percent said it was low salaries.
This major decrease in the amount of remittances to Mexico means that households in Mexico that are in serious need of economic aid will lose billions of dollars they would normally receive.
“The feelings between U.S. and Mexico are already strained because of the rhetoric of the immigration debate," Bendixen said. "Now it is clear that this immigration policy, and especially the anti-Mexican climate created by the immigration debate, has resulted in billions of billions of dollars that are no longer coming into Mexico.”
Bendixen also notes that the anti-immigrant sentiment is a problem for many U.S. communities.
“In many of these cities where immigrants feel unwelcomed and are beginning to leave in large numbers, their economies have collapsed," Bendixen said. "They are living very difficult times because immigrants provided so much of the labor.”
Although the prospect for comprehensive immigration reform seems dim in Congress, for now, findings such as this indicate that immigration remains a critical issue not only to Americans and immigrants, but also to families of immigrants living on the other side of the border. Commenting on the importance of remittances for the immigration debate Bendixen said, “Anything that takes the debate about immigration away from prejudices and brings it to the economic reality is a good thing.”
A Conversation with Sergio Bendixen on Remittances:
Listen to Sergio Bendixen discuss the decline in remittances and its implications. He spoke with New America Media editor Sandip Roy on the radio show UpFront.
posted on August 20, 2007 01:18:02 AM newMexicans living in the U.S. sent less money home over fear of being deported
Fears over being deported from the U.S. kept many Mexican immigrants from sending money home to their families in Mexico
By Armando Duke
(AXcess News) Houston - Fewer Mexican immigrants are sending money back home to Mexico. Those immigrants surveyed showed that many were saving money instead, affraid of the uncertainty over whether Congress will pass an immigration bill this year which will force them to leave the United States.
The survey, which was conducted by the Inter-American Development Bank (IDB), showed that at least two million Mexicans didn't receive as much money from relatives living in the United States in 2006 as they had in the past.
The percentage of Mexicans who regularly send money home fell to 64% in the first half of 2007, down from 71% last year, according to recent IDB statistics. But the flattening of money flowing to Mexico from the U.S. contrasts with the continued growth of money transfers to Central American countries. Remittances to El Salvador, Guatemala and Honduras rose by an average 11% during the first half of 2007, the bank said.
The drop was the steepest in states where Latin American immigration is most recent, like Georgia, North Carolina or Pennsylvania. In "new destination" states the percentage plunged to 56% this year from an average 80% in 2006.
States that have long had large Hispanic communities, such as California, Texas, Florida and New York, have not seen similar falls. In "traditional destination" states the percentage of Mexicans who regularly send money home slipped to 66% from 68% over the same period.
"In the new destination states, around half a million migrants have stopped sending money home," said MIF Manager Donald F. Terry. "This means that over the past year two million people in Mexico have lost a vital lifeline".
The drop helps explain why, after years of double-digit growth, remittances to Mexico were essentially flat during the first half of 2007 ($11.5 billion) against the same period of last year ($11.4 billion), according to Mexican central bank data.
Pollster Sergio Bendixen, whose Miami-based company carried out this survey and many other similar polls for the MIF since the year 2000, said Mexican migrants in new destination states cited an unprecedented range of difficulties that made them less optimistic about their prospects.
Most migrants said it is harder to find jobs for good pay now than last year. Among the main obstacles mentioned were the lack of legal immigration documents, formal education and proficiency in English. A vast majority also felt discrimination against Latin Americans has grown.
Bendixen noted that the slowdown in remittances could herald economic dislocations in states from which Mexican migrants have stopped sending money home, although the potential impact is not yet fully understood.
posted on August 20, 2007 01:21:20 AM newImmigrant Sentiment = Less Money Sent to Familias
15:08 H | Topics: Immigration - Mexico - Money
The anti-immigrant sentiment and policies in the United Sates have economic effects far beyond national borders. For the first time the amount of money being sent home to Mexico from immigrants here has flatlined instead of rising as it has been doing in past years. Fearing redadas, many immigrants are stockpiling their money just in case they are forced to move or are deported back to Mexico.
The percentage of Mexicans sending money back home has dropped from 71 percent to 64 percent in states with large immigrant populations (like NY). The drop is greater in other states from 80 percent to 56 percent. But its not just fear that lowering the number or remesas and the amount if money being sent, it's because the job market has gotten worse for undocumented workers.
