Friday, October 30, 2009

Remittances to Mexico fall 13 percent

Mexican emigrants sent home $16.4 billion during the first nine months of this year, down 13.4 percent from the same period in 2008, the country's central bank said.

Last month's remittances, $1.74 billion, were 17.5 percent lower than the total for September 2008, Banco de Mexico said Thursday.

Economists with the private Grupo Financiero Ixe attributed the sharp decline in remittances to the especially harsh recession in the US, where the unemployment rate among Hispanics is 12.6 percent.

The vast majority of the remittances Mexico receives comes from the US, home to 12 million Mexicans - about half of them undocumented immigrants - and millions more descendants of Mexican immigrants.

"The poor labour-market scenario (both unemployment and a slow advance of new job creation) significantly affected the bad result in remittances for Mexico," Ixe said.

The firm's economists predicted remittances will increase in 2010 as the US economy recovers.

Analysts forecast an 11.2 percent drop in remittances for all of 2009, though adding that money from emigrants will remain Mexico's second-largest source of revenue after oil exports.

Banco de Mexico said that the median remittance during the first nine months was $323.90, off $20 from the same period last year, and that 97 percent of the payments were made via wire transfer.

Remittances to Mexico totalled $25.15 billion in 2008, down 3.6 percent from the previous year.

Money from relatives abroad represents close to 19 percent of total income for urban Mexican households and 27 percent for rural households, according to official figures.
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