Remittances to Spanish-speaking Latin American countries have rebounded from their recent decline, a new study by the Pew Research Center shows, but the amount of money sent to Mexico has continued to fall, likely because the Mexican immigrant population in the U.S. has dropped dramatically since the 2007 recession.
The amount of money or other assets that migrant workers sent to Mexico, an estimated $22 billion in 2013, has fallen from a pre-recession peak of more than $30 billion.
“The decline in remittances to Mexico – nearly all of which come from the U.S. – is linked to economic changes in the U.S., where one-in-ten Mexican-born people live,” the report states.
One explanation for the drop in remittances, according to the Pew analysis, is that Mexican immigrants are returning to Mexico at rates equal to or higher than Mexican migration to the U.S. through 2012.
The U.S. accounted for more than 75 percent of 2012 remittances to Latin America, including Mexico. For Mexico alone, 98 percent of remittances were sent by U.S. residents. Mexico receives almost half of all remittances sent to Latin America.
Other Latin American countries, unlike Mexico, have recovered from their recession lows and even surpassed historical highs with remittances estimated at $31.8 billion this year.
The study found that those Latin American nations with the highest immigrant population in the U.S. – Mexico, El Salvador, Guatemala, and Honduras – were the countries with the highest share of remittances from the U.S.
High levels of remittances can increase a nation’s 'creditworthiness' and allow migrants to bolster relatives’ incomes, making them less vulnerable to poverty.
Remittances to Latin America and Mexico fell sharply after 2007, when the U.S was hit by recession, but have more than doubled overall since 2000.
The U.S. is the largest source of remittances worldwide, with a 2012 total of $123.3 billion, according to World Bank data. Saudi Arabia comes next with $27.6 billion and then Canada with $23.9 billion.
Mexico is the fourth largest recipient of remittances worldwide, preceded by India, China and the Philippines.
The Pew report is based mostly on World Bank data and 2012 estimates from the U.S. Census Bureau.