According to a report released by the International Monetary Fund (IMF) and the Multilateral Investment Fund (MIF) Remittances to Latin America and the Caribbean Set a New Record High in 2014, the recordbreaking increase in remittances (money transfers) to Latin America reflects significant growth in remittance flows to Mexico (8 percent), Central America (7.4 percent) and the Caribbean (6.3 percent), linked to the recovery of the economy and labor market in the United States. However, there was a decrease of 1 percent to South America, partly due to the economic situation in Spain, which constitutes a major source of remittance flows to that continent.
Since the 2008-2009 international financial crisis, and up until 2013, the total amount of remittances sent by migrants to their countries of origin had failed to match the levels of 2008, when they reached a record high of almost $65 billion.
“Remittances remain an important source of income for millions of families in Latin America and the Caribbean,” said Fernando Jimenez-Ontiveros, Acting General Manager of the MIF. “The remittance sector has evolved by adopting new technologies and options for sending and receiving, and has seen a decline in fees. However, it is essential to continue working so that those who receive them have opportunities for savings and investment.”
Mexico, which receives more than a third of all remittances sent to the region, continues to be the largest recipient, with $23.6 billion, followed by Guatemala with $5.5 billion, the Dominican Republic with $4.5 billion, El Salvador with $4.2 billion, and Colombia with $4 billion.
According to the MIF-IDB report, the recovery of remittances is projected to continue or even accelerate in 2015, given growth forecasts for the United States, Spain, and Latin America.
The Multilateral Investment Fund is a member of the Inter-American Development Bank Group, and supports private sector-led development benefiting low-income populations and the poor. The goal is to give them tools to boost their incomes: access to markets and the skills to compete in those markets, access to finance, and access to basic services, including green technology. A core MIF mission is to act as a development laboratory—experimenting, pioneering, and taking risks to build and support successful micro, small and medium business models.