Sufficient unto the day is the evil thereof

Remittance Men

In Journalism on December 22, 2004 at 4:22 am

Remittances, money sent home by foreign workers, totaled $30billion in the U.S. in 2003. Worldwide, they total $70 billion, a figure that exceeds the amount of worldwide aid to developing countries. In Nicaragua, remittances constitute 29% of GDP, for El Salvador, the figure is %15 and for Tonga, 39%. It is an acknowledged source of wealth for many countries.

Cities in the Philippines and El Salvador, among other places, rely on remittances for public works projects, including schools, sewers and monuments. Mexico even offers matching funds in some cases. Some cities that provide a great many remittance-men have grown relatively wealthy.

The industry that allows workers to make remittances is a $50 billion one. It is so lucrative that Yahoo has now introduced a function that allows foreign workers to send home money online. They can choose to have the recipients pick up the money at one of 60,000 “MoneyGram” locations in more than 155 countries or they can choose to have the recipient receive an ATM card with which money from the account can be withdrawn.

The negatives in this trend include the removal of economic development from the remitted-to countries, with all the entrepreneurial energy in many places going into the migration and remittance cycle instead of in making money in the place of origin. In the U.S. and other countries the money is remitted from, that money, clearly, does not remain in place and therefore does not add to the local and national economy it is taken from.

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