Remittances and the Caribbean Experience

Regional Seminar on Migrants’ Money Remittances: An Alternative for Latin America and the Caribbean?

SELA and CAFCaracas, July 26-27, 2004

Elizabeth Thomas-Hope

University of the West Indies

Mona, Jamaica

Country Total Remittances( millions of dollars)

Mexico 9,920

India* 9,160

Philippines 6,366

Egypt 2,911

Turkey 2,786

Bangladesh 2,104

Jordan 2,011

Dominican Republic 1,982

El Salvador 1,925

Colombia 1,784

Top Ten Remittance RecipientsAmong Developing Countries, 2001

*The data for India is from 2000

Source: International Monetary Fund, Balance of Payments Yearbook 2002, Migration Information Source.

Country Total Remittances, as a percentage of GDP

Haiti* 24.2

Jordan 22.8

Nicaragua 16.2

El Salvador 14

Jamaica 13.6

Dominican Republic 9.3

Philippines 8.9

Honduras 8.5

Ecuador 7.9

Guatemala 3.1

Remittance Dependence of Selected Countries, 2001

*Remittance levels for Haiti are as estimated by the Inter-American Development Bank.

Source: International Monetary Fund, Balance of Payments Yearbook 2002; Migration Information Source; World Bank, World Development Indicators 2002.

Year Jamaica Mexico Dom. Republic

1981 89 183 259

1982 106 155 271

1983 59 169 278

1984 38 259 300

1985 130 245 342

1986 75 250 312

1987 79 277 366

1988 87 269 372

1989 144 2180 368

1990 159 2903 367

Official Worker Remittances Received in Selected Labor-exporting Countries 1981 - 2002

Year Jamaica Mexico Dom. Republic

1991 152 2701 368

1992 171 3334 375

1993 197 3514 381

1994 470 3572 778

1995 582 3673 795

1996 618 4103 888

1997 609 4618 1033

1998 618 5260 1239

1999 627 5405 1389

2000 698 5816 1494

2002 1227 9814 1939

Sources: International Monetary Fund, Balance of payments Yearbook (various issues

Cont’d

Assumptions ?

That one can predict volume of remittance flows will be positively associated with:

• volume of out-migration ?

• volume of return ?

Immigrants Admitted to the United States By Country of Birth 1987 - 2002

Source: US Immigration and Naturalization Services Statistical Yearbook of the Immigration and Naturalization Service, 1997

0 200000 400000 600000 800000 1000000 1200000 1400000

Antigua

Bahamas

Barbados

Cuba

Dominica

Dominican Republic

Grenada

Haiti

Jamaica

St. Kitts and Nevis

St. Lucia

St. Vincent & The Grenadines

Trinidad andTobago

Other Caribbean

Total

Caribbean Immigrants admitted in the USA(selected years)

1990 2000 2002

Caribbean 115,351 88,198 96,489

Dom.Rep. 42,195 17,536 22,604

Haiti 20,324 22,364 20,268

Jamaica 25,013 16,000 14,898

Trin. & Tobago 6,740 6,660 5,771

• What are the trends in out-migration and return migration?

Take the case of Jamaica, for example, remittance flows have been increasing even though volume of emigration and return have been decreasing.

Return Migrants to Jamaica (1992-2002)

• 1992 1552• 1993 2359• 1994 2585• 1995 2353• 1996 2349• 1997 2094• 1998 1875*• 1999 1765*• 2000 1282*• 2001 1117• 2002 1105• 2003 1180

Percentages of Return Migrants to Jamaica by country of last residence

(totals for 1993-2002)

UK 43%

USA 39%

Canada 11.9%

Others 5.8%

Important questions in understanding the association between volume of remittance flows and migration patterns

• What type of migrant remits most ?

• at what stage(s) of the migration cycle ?

What types of migrants/stage in migration cycle remit most/least ?

• Retired persons ?

• Persons in the labour force on return –Long-stay; short-stay; transnational

• Unskilled/low level skilled, high level professional; student…..

  US FARM HOTEL TOTAL

  WORKERS WORKERS  

  2002 2002 2002

MONTH M M F T  

January-March 214,841 238,864 142,444 381,308 596,149

April-June 352,625 796,766 782,736 1,579,440 1,932,127

July-Sept 1,223,666 1,452,873 1,839,567 3,292,440 4,516,106

Oct-Dec 2,015,382 909,159 1,328,981 2,238,140 4,253,522

TOTAL 3,806,514 3,397,662 4,093,728 7,491,390 11,297,904

REMITTANCES (US $) TO JAMAICA FROM THE U.S.A.Of Occupational Category and Sex of Worker (2002)

Source: Jamaican Ministry of Labour and Social SecurityStatistical Bulletin 2002

Amount received equivalent JA $

Percentages ofhouseholds receiving

remittances monthly

Below 5000 67

5000-10000 23

10000-15000 4

15000-20000 2

20000-25000 2

25000-30000 1

30000-35000 0

35000-40000 0

Over 40000 1

Distribution of Remittances Received MonthlyRio Grande Valley sample, Jamaica (2002)

Ishemo, 2004

RemittanceCategory

% receiving Monthly

% receivingOccasionally

Cash 74 26

Foodstuff 10 90

Clothing 0 100

Total persons=431

Source: Ishemo, 2004    

Household Remittance ReceiptsRio Grande Valley sample (2003)

Percentageof

Expenditure Household Farm Related

< 25% 6% 19%

25-50% 4% 9%

> 50% 46% 16%

Total sample = 431Source: Ishemo, 2004

Household Expenditure of Cash RemittancesRio Grande Valley sample, Jamaica (2002)

The Jamaica GleanerThe Jamaica Gleaner

Return Professionals to Jamaica Financial Transfers and Financial Security

• Returning professionals in this study did notremit or transfer substantial sums of moneyfrom their previous country of residence toJamaica either prior to their return orsubsequently.

• Only 20% of the persons inthe study indicated that they transferred what they regarded to be relatively largesums at the time of returning.

Return Professionals to JamaicaSocial Security / Pension Payments

Almost 50% the number of persons in the

sample population would be entitled to

social security payments from the country

of their former residence abroad and or

state pension when they reached

retirement age, even if they remained in

Jamaica until they retired

Return Professionals to Jamaica Investment

82.9% of the Sample currently tended to

invest in Jamaica more than they did

abroad

What is the nature of transnational households ?

Eg.• All the returnees of a sample of high level professionals

to Jamaica held a Jamaican passport, in the main because of their sense of, and commitment to, ‘being Jamaican’

• 58% had dual citizenship and held a passport of another country as well as a Jamaican passport (others held a Green Card for the USA)

What are the other incentives/ disincentives to the sending high

levels of remittances ?

– The environment in the host and especially in the ‘home’ country - eg:

– Liberal financial sector– Attractiveness for investment– Attractiveness for return (security/health &

educational services)

Implications

• Policies for optimizing remittance flows and development impact must be based on the development of high confidence levels and a liberal migration environment:

• the identification of effective incentives geared to the different migrant/return migrant target groups. These would include – financial incentives, investment opportunities eg in health, education & welfare, - security.