Caribbean records two per cent growth in remittances – Jamaica Observer
WASHINGTON, United States (CMC) — The Inter-American Development Bank (IDB) has announced that Caribbean countries are projected to receive US$18.4 billion in remittances, reflecting a two per cent growth similar to the levels seen in 2023.
The IDB anticipates that remittances to Latin America and the Caribbean will reach a historic high in 2024, despite experiencing the slowest growth rate in the past decade.
According to a new report, remittances are starting to return to the growth rates that characterized the period prior to the exceptional increases witnessed during the COVID-19 pandemic.
If current trends continue, the region is expected to receive US$161 billion in remittances in 2024, marking a five per cent increase over 2023.
The Washington-based financial institution attributes the estimated slowdown for this year to a combination of decreased human mobility and slower job market growth for migrants abroad. Additionally, an improvement in the economies of Central American and Mexican recipient countries is reducing the financial needs of those beneficiaries.
On the other hand, the challenges in South American countries, including currency devaluations and a slower economic recovery, have led to a greater necessity to send remittances to support families in that region.
In Central America, remittance flows are set to grow by 6.6 per cent, expected to reach US$45.7 billion. Conversely, the South American region is projected to see a 9.1 per cent increase in remittance inflow, totaling approximately US$31.7 billion.
The IDB’s report also offers a comprehensive analysis of the behaviors and profiles of remittance senders and recipients. While the amounts sent differ based on nationality, gender, and length of stay abroad, remittance totals can range from US$131 to US$648 monthly, representing six to 23 per cent of migrants’ incomes.
More than half of migrants indicate that they send money primarily to their mothers, while one in three send funds to their fathers. Among male senders, the median remittance stands at US$300 monthly, which remains fairly constant during the first 15 years of migration but decreases as a percentage of income when earnings start to increase. For female senders, the proportion of income dedicated to remittances remains stable over time, leading to increasing amounts being sent as years go by.
Surveys underscore the vital role of remittances in maintaining the living standards of families in the countries of origin. The IDB states that 80 per cent of migrants report using the money for essential maintenance expenses, including daily food, housing, and transportation costs. Medical expenses were cited as the second most common use for remittances. Additionally, over half of the respondents indicated that their remittances go towards education, savings, business investments, and real estate purchases.
