MIF’s annual analysis of migrants’ money transfers shows year-on-year growth of 6%

Latin American and Caribbean migrants sent $61 billion in remittances to their home countries last year, up 6 percent from $57.6 billion in 2010, according to a report released today by the Multilateral Investment Fund (MIF), a member of the Inter-American Development Bank group.

Last year’s increase confirmed the upward trend in migrants’ money transfers that started in mid-2010, after the double digit drop in remittances recorded in 2009 as a result of the economic crisis. In 2011, nearly every country in this region received a greater dollar amount in remittances than the previous year.

Remittances to Latin America and the Caribbean are likely to rise this year after stabilizing during 2010, although a weaker dollar and higher inflation are reducing their purchasing power in many countries, according to the Inter-American Development Bank’s Multilateral Investment Fund (MIF).

A Study of the Potential of Microinsurance Products to Help Migrants Cope with Cross Border Risks Multilateral Investment

The path of a migrant is generally a risky one. Crossing borders, often illegally; leaving loved ones behind; trusting new people along the way; earning uncertain income. All these activities involve risk. Once migrants reach their destination, they face a new set of risks: learning languages and new cultural norms; seeking out employment in new environments; finding living arrangements. The task of finding a home alone can be an enormous challenge, where rents are costly and often require documentation or credit histories that migrants do not have. As a result, migrants often live in cramped conditions, facing health and safety risks associated with these living conditions.

Once migrants find employment, the possibility of losing a job or being injured while working,

add to risks.

This document is a review of the Multilateral Investment Fund (MIF)’s remittance program since 2000, when it began. The review focuses primarily on the portfolio of remittance projects undertaken by the MIF from 2001 to 2009, and secondarily on the MIF’s research and dissemination activities during that same time period. The review took place between May and September 2009.

Remittance flows to countries in Latin America and the Caribbean (LAC) in 2009 were not immune to the impact of the global financial crisis. The economic slowdown has resulted in a 15% decline in remittance receipts compared to 2008. However, analysis of data from the last quarter of 2009 point to a possible stabilization of flows in 2010.

This document was prepared by: Ricardo Monge-González , Oswald Céspedes-Torres and Juan Carlos Vargas-Aguilar. It is part of the project “Remittances, financial democratization and entrepreneurship opportunities in Costa Rica and Nicaragua: Comparing South-South and North-South cases,” implemented by the Academia de Centroamérica in conjunction with the Banco Nacional de Costa Rica, the CAATEC Foundation and the Business Incubation Center of the Instituto Tecnológico de Costa Rica (CIE TEC). The project is sponsored by the Multilateral Investment Fund of the Inter-American Development Bank (MIF/IDB), the International Organization for Migration (IOM, with financing from the Spanish Agency for International Development Cooperation, AECID) and the Banco Nacional de Costa Rica (BNCR).

Este documento fue elaborado por: Ricardo Monge González , Oswald Céspedes Torres y Juan Carlos Vargas Aguilar. El trabajo constituye parte del proyecto "Bancarización de remesas, democratización financiera y oportunidades innovadoras de inversión en Costa Rica y Nicaragua: casos comparativos sur-sur y norte-sur", el cual es ejecutado por la Academia de Centroamérica en forma conjunta con el Banco Nacional de Costa Rica, la Fundación CAATEC y el Centro de Incubación de Empresas del Instituto Tecnológico de Costa Rica (CIE TEC). Este proyecto es patrocinado por el Fondo Multilateral de Inversiones del Banco Interamericano de Desarrollo (FOMIN/BID), la Organización Internacional para las Migraciones (OIM; mediante financiamiento de la Agencia Española de Cooperación Internacional para el Desarrollo: AECID) y el Banco Nacional de Costa Rica (BNCR).

This report presents fieldwork research and results of a nationwide survey of Latin American and Caribbean migrants on how the economic crisis is affecting their economic situation and their ability to send remittances. The study shows that difficulties are mounting for migrants who send money home to take care of their families, and it estimates that in 2009 flows to Latin America may drop by 11% over 2008 values.

No existe discusión en el ámbito económico y político respecto al impacto positivo de la implantación
y extensión de las TIC para el desarrollo económico y social de un país o región. Existe
amplia literatura que muestra cuán significativa ha sido la aportación de la inversión y difusión de
las TIC al crecimiento del PIB y de la productividad en los países desarrollados desde mediados
de los años noventa. Asimismo, la capacidad de las TIC para generar bienestar social queda demostrada
en casos de éxito de países desarrollados y que, cada vez con más frecuencia, se están
dando también en países en desarrollo. Por el lado de las finanzas, la evidencia empírica de la
causalidad directa entre desarrollo del sistema financiero y crecimiento económico es también
abundante. De ahí la importancia de la bancarización como objetivo para el desarrollo.

This document is an overview of remittance flows to Latin America and the Caribbean in 2008 and an analysis of current trends in remittance flows to the region, with a special focus on the impact of the financial crisis. The document accompanies the “2008 Map of Remittances to Latin America and the Caribbean”, which is produced annually by the IDB. The document is also a follow-up to the October 2008 release entitled “IDB estimates of 2008 remittance flows to Latin America and the Caribbean”.