Guatemala, more than US$1 Billion in One Month

Remittances to Guatemala approached US$1 billion per month three times in 2019, but even during periods of economic growth and peak employment in the United States, the rate has never been as high as it was this July. Now, in the midst of one of the worst global health crises in decades and as the U.S. unemployment rate reaches new heights, Guatemalans living abroad have nonetheless managed to send home a record $1.078 billion dollars in just 31 days.
At the end of April, many of us watched anxiously as remittances dropped by 20 percent from the previous year’s rate for the same month. Had this trend continued, the Guatemalan economy would have suffered up to 20 billion Quetzales, or $2.6 million dollars, in losses. This year’s drop in remittances was the result of lockdown restrictions imposed in U.S. cities and states with large Guatemalan immigrant populations, such as New York, California, Florida, Boston, and New Jersey, where communities have suffered directly from the pandemic as well as the resulting economic impacts of lockdowns, as indicated by a Hispanic unemployment rate of roughly 18 percent and an exponential increase in unemployment claims. The news was so alarming that it caused a seasonal appreciation in the value of the US dollar.
May 2020 was possibly the worst May we have seen yet, in terms of remittance income. For the first time in a decade, there was a cumulative year-to-year decline in dollars sent home. Despite this, we have already seen signs of recovery in several sectors of the U.S. economy. May was the last month that remittances continued to fall. June saw an increase from the previous year, and July’s growth practically recaptured the year’s numbers to pre-crisis rates of growth: A 14 percent increase in remittances resulting in a record-breaking $1 billion dollars—a milestone achievement for the entire community of Guatemalans who live and work outside the borders of their home country.
In the last 75 days, Guatemala has witnessed yet another example of the resilience of its migrant community—a community of people who have all, at some point, survived a difficult and dangerous journey, reinvented themselves, lived through a mass health crisis (the deaths and contagion surrounding them as well as the lockdowns and quarantines) and have still managed to forge ahead. A community that supports thousands of Guatemalan families as the country’s economic crisis grows ever longer and deeper. The recovery of remittance flows appears to be the most hopeful indication that it may be possible to avoid the economic collapse of millions of Guatemalan households.

Continue reading at: El Faro

Leave a Reply

Your email address will not be published. Required fields are marked *