NCPA - National Center for Policy Analysis

MEXICAN REMITTANCES TRIPLE

April 18, 2005

Mexican emigrants will send as much as $20 billion in cash this year to relatives in Mexico, according to projections by Mexico's Central Bank.

That figure is three times what total remittances were five years ago, when the amount was $6.6 billion. If the 2005 estimates hold true, remittances probably would become the largest source of foreign exchange in Mexico, bank officials said, surpassing even oil.

  • The Central Bank president, Guillermo Ortiz, projected that over the next seven to eight years, remittances will grow by 20 percent annually.
  • He also raised the expected growth rate of the nation's economy to 4.2 percent, from the 3.8 percent initially forecast.

The explosive increase in remittance money, officials have said, is a reflection of policies of President Vicente Fox's government that are aimed at reducing the cost of Mexicans abroad sending money home.

Some nongovernmental analysts say, however, that the jump merely mirrors a rise in illegal immigration into the United States.

"The sad truth is that Mexico still can't create enough jobs to keep its countrymen home," said Luis Miguel Rionda, an immigration expert at the Colegio de la Frontera Norte in Tijuana.

  • Today, nearly 11 million Mexicans call the United States home, census officials estimate -- that's about 4 percent of the U.S. population -- but almost 10 percent of Mexico's population of 105 million.
  • Mexico and India lead the world in the value of remittances that their emigrants send home, ranking ahead of China, Pakistan and the Philippines; last year, India received $17.5 billion in remittances from the United States

Source: Alfredo Corchado, "Payments to Mexico skyrocket: Emigrants' remittances tripled in 5 years; rate troubles analysts," Dallas Morning News, April 14, 2005.

 

Browse more articles on Government Issues