What Is the Outlook for Remittances to the Caribbean?
Remittances to Latin America and the Caribbean are likely to have reached a new high of $126 billion in 2021, the World Bank announced in November. That would amount to an increase of 21.6 percent as compared to 2020. The value of remittances exceeds 20 percent of gross domestic product for some smaller countries in the region, including Jamaica, where the money transfers likely amounted to nearly a quarter of GDP in 2021. What is the outlook for remittances to the Caribbean in 2022? What factors will most influence the level of remittances to the Caribbean in the coming year? Which countries in the Caribbean will see the greatest amount of remittances, and what impact will the transfers have on those countries’ economies?
Julia Yansura, program manager for Latin America and the Caribbean at Global Financial Integrity: “Remittances to the Caribbean grew dramatically in 2021, a trend that will likely continue in 2022. To understand why, we need to look at factors such as migration, home and host country conditions, the percentage of migrants that remit, as well as sending behaviors such as frequency, method and principal (the amount per transaction). 2022 will likely bring strong growth in remittances to Haiti in response to the country’s political and economic crises and high levels of emigration. Moreover, as Haitian migrants leave South American host countries and make their way toward the United States, they may eventually earn higher wages and remit more. Jamaica and the Dominican Republic will see robust growth as well, as remittances help to offset economic challenges related to the instability of the tourism sector. Remittances to Cuba are the biggest question mark. In December, members of the U.S. Congress requested that the Biden-Harris administration reduce restrictions for humanitarian reasons; such a move would have important impacts…”Read More
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Covering Latin America’s banking and insurance sectors, remittances trends and data, micro lending issues, new technologies in the industry, anti-money laundering regulations, and much more, the Inter-American Dialogue’s biweekly Financial Services Advisor, a sister publication of the Latin America Advisor, gives readers fresh insight and diverse viewpoints from financial sector leaders. To subscribe or for more information, contact Erik Brand, publisher of the Advisor, at email@example.com.