RemittancesGateway.org

Recession causes record drop in money sent to Mexico

Thursday, 28 January 2010 12:16

Source: USA Today
By: Michael Winter

Hit by the recession, Mexican migrants sent home 15.7% less in remittances last year, a record drop, the country's central bank reports.

Although it marked the second straight yearly decline — and the second drop since tracking began in 1996 — migrants still sent home big bucks: about $21.2 billion. For 2008, the bank reported $25.1 billion in remittances.

The Banco de Mexico breaks out the types of transfers for the last three months of '09, along with a state-by-state breakdown of where the money went in Mexico from April to December. If you want to know more about how money can be transferred through a U.S. bank, the details are here.

Seeking Alpha pointed out this month, "The predominant cause of falling remittances is rising unemployment in the United States, which has had a disproportionate impact on migrants."

In November, The New York Times wrote about how the recession has actually reversed the flow of money crossing the border, with Mexican families sending money north to help their unemployed relatives.

Seeking Alpha disputed claims that a weaker dollar was a major factor in the remittances decline:

"Ironically, a weaker dollar may be exactly what migrants need, as it would stimulate American export growth, boost overall employment and, in all likelihood, result in increased remittance flows."