Commerce News: Migrant Remittances Down, Up

Long-term trends favor migrant remittances as Mexico’s principal source of foreign exchange in the future.

(LAS CRUCES, N.M.) - In the first trimester of 2010, the amount of dollars sent by migrant workers in the US to Mexico registered the worst seasonal plunge in five years, the Bank of Mexico reported this week.

According to the country’s central bank, about $6.6 billion in remittances entered the country’s economy during the first four months of 2010. The sum was nearly 9 percent less than the $7.25 billion received during the same period in 2009.

Averaging slightly more than $316, the typical remittance also was less than the amount received during the first trimester of 2009.

Prior to the 2008 economic crash, migrant remittances had topped more than $24 billion annually. The good news for analysts from the Bank of Mexico and the Spanish-owned BBVA Bancomer bank was that positive tendencies emerged during the last two months, suggesting the remittance free-fall might have hit rock bottom. In April, remittances of $1.78 billion showed a slight gain of 0.23 percent, while preliminary reports showed dollars captured during the month of May were also on the upswing.

Analysts cited some upticks in US economic activity as favoring a positive trend, but also cautioned that continued high levels unemployment and the uncertain effects of Arizona’s anti-immigrant SB 1070 law, scheduled to go into effect next month unless it is overturned in court, could complicate the remittance recovery picture. Still, one leading observer predicted economic forces would eventually submerge SB 1070 and related anti-immigrant measures.

“Economic reality will definitely prevail, contended Moises Jaimes, director of Bancomer Transfer Services. “Let’s remember that migrant labor, at a reasonable cost and of good quality is an anti-inflationary measure that definitely helps produce goods and services at a lesser and controlled cost. This is perfectly part of the US economy.”

Jaime’s firm processes at least 40 percent of the migrant dollars sent from the United States. Migrant remittances represent the second source of legal foreign exchange for Mexico, coming in only after petroleum exports. During the first trimester of 2010, oil income amounted to $11 billion, in comparison with the $6.6 billion in migrant remittances.

However, long-term trends favor migrant remittances as Mexico’s principal source of foreign exchange in the future. According to multiple reports, Mexico only has about nine years of easily recoverable oil resources remaining. On the other hand, a youthful population with few employment prospects coupled with aging trends in the US workforce puts migrant labor in a favorable position as a primary source of dollars.

Frontera NorteSur (FNS): on-line, U.S.-Mexico border news Center for Latin American and Border Studies New Mexico State University Las Cruces, New Mexico

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Douglas Benson June 6, 2010 10:52 am (Pacific time)

Let me tell you a story about a Russain immigrant I used to work with. It was durring a huge constuction boom in 1990 and there were so many constuction jobs it was silly .The guys I worked for all had at least a thousand apartments and condos going at one time and so did several other contractors . Enter ,lic and bonded "independent contractors " and our Russian immigrant buddy . Soon he is getting his own contracts and making good money . Now Russain families work as a community ,the adult children work for the collective and the head of the family meets thier needs .So far so good nothing wrong with familly working together . A few years later I ended up working for him instead of with him . I took my check to the bank but they refused to cash it saying there was no such address .No problem come on down and we will cash it for you . I arrived at his home or should I say mansion on several acres of land with several run down shacks out in the back corner . Gee theres Jose,and Juan.and about five or six other hispanic guys from the job that I could see . Want to take a wild guess what they were being paid ? Lets just say my weekly check [take home] was twice what they made all month . I realized that that is how he could underbid and still rake in the cash. Modern day SLAVERY . Im out peace.

Vic June 5, 2010 2:35 pm (Pacific time)

DB...we are not so far apart on this issue..Mexico has a very protectionist economy, and I think the US should too. Almost everything one can buy here is "Hecho En Mexico" (MADE IN MEXICO). It is hard to find imported goods here, and whenyou do, they are incredibly expensive. If a Mexican company wanted to offshore it's manufacturing, they would end up paying MORE for their products. It is crazy to allow American companies to send all their manufacturing jobs overseas while screaming that the "criminal" illegals are the problem. Mexico has huge tariffs on imported goods...a pkg. of Ball Park Franks is around $6 US, while the Mexican equivalent is $1.33 US. This is what America needs to do. Want to buy a Toyota truck instead of a Ford? It should cost you so much that you think again. In my mind, the "Illegal" thing is a smokescreen to keep our attention off the real problems, which are big business writing their own rules and screwing the American workers. My brother had a thriving granite countertop business, but now Ukranian work crews living in Portland have knocked prices down so low he can hardly compete. It aint just the Mexicans. Im all about American workers and American jobs...my children and grandchildren are in the US. The US could learn a thing or two from Mexico. The US government and their fascist ties to big business have hurt American workers much more than any border jumpers ever could.

Douglas Benson June 5, 2010 9:28 am (Pacific time)

Who said Im not hardcore about ending the wars ? I am also right on the front line of jobs and wages that are directly impacted by these criminals and those that hire them . I guess Im the wrong color to hang drywall Ive been told that for years . Thats 6.6 billion by the way and nothing compared to war spending I know . My old work partner is hispanic he sent half his check every week to Mexico and his family thanks to his work here now owns several businesses homes ect. and he moved back last year a rich man in Mexico . I wish him the best he was a great partner,a legal immigrant ,and a union brother that stood with us on the picket line for a living wage. Peace

Vic June 4, 2010 7:44 am (Pacific time)

Oooops..my last comment was in error.. The $26.6 billion figure that DB is lamenting is actually nearly FIVE weeks war spending...just a little over a month.

Vic June 4, 2010 6:59 am (Pacific time)

Wow...that is ONE HALF of our weekly expenditure for war...ONE HALF OF A WEEKS cost to kill other brown people. So maybe this is "a very good reason to get hardcore" about ending the f***ing wars for profit, eh ?? Funny how it enrages people when a dollar goes to an illegal, but not a peep about the $5 billion per week that goes to killing mostly civilians. But hey....thats the American way...

Douglas Benson June 4, 2010 4:57 am (Pacific time)

Two very good reasons to get hardcore about enforcement .#1 cheap labor ruins wages for everyone else .#2 6.6 billion dollars that should have stayed here.

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Commerce News: Migrant Remittances Down, Up

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