Caribbean region reports growth in remittances

The Inter-American Development Bank (IDB) has projected that Caribbean nations will receive approximately US$18.4 billion in remittances in 2024, reflecting a modest growth rate of two percent, consistent with the growth observed in 2023.

In its latest report, the IDB emphasizes that while remittance flows to Latin America and the Caribbean are anticipated to reach a historic high, they are growing at the slowest pace in a decade. Despite this deceleration, the IDB notes that remittance levels are gradually returning to the growth rates seen prior to the COVID-19 pandemic.

Overall, the region is expected to receive US$161 billion in remittances in 2024, representing a five percent increase from the previous year.

The projected slowdown for 2024 can be attributed to several factors, including reduced human mobility in 2023, slower labor market growth for migrants abroad, and a relative improvement in the economies of Central American and Mexican recipient countries.

The report reveals significant regional variations in remittance trends. Central American countries are expected to experience a growth rate of 6.6 percent, with remittances reaching US$45.7 billion.

In contrast, the South American region is projected to witness a more substantial growth rate of 9.1 percent, totaling US$31.7 billion in remittance income.

The IDB’s comprehensive analysis offers valuable insights into the profiles and behaviors of remittance senders and recipients. The amounts sent vary by nationality, gender, and duration of residence abroad, ranging from US$131 to US$648 monthly. These figures represent between six and 23 percent of migrants’ incomes.

Notably, the study indicates that more than half of migrants primarily send remittances to their mothers, with one in three directing funds to their fathers.

Gender differences in remittance patterns are also significant: men tend to send a median of US$300 monthly, with this amount remaining stable for the first 15 years, although it decreases as a percentage of income over time. Conversely, women maintain a consistent rate of income allocation to remittances, resulting in increased amounts sent over time.

The report highlights the critical role of remittances in supporting families in their countries of origin. Approximately 80 percent of migrants reported that the funds are primarily utilized for essential maintenance, including daily food, housing, and transportation expenses.

Medical expenses emerged as the second most common use of remittances, with other significant purposes including education, savings, business investments, and real estate. -(CMC)