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Remittances are pivotal to development
Dear Editor,
Remittances are an integral part of poor countries’ economies today. And Dillon Alleyne in “Motivations to Remit in CARICOM: A GMM Approach,” in the Social & Economic Studies of UWI in 2006, noted that investment motives push remittance flows in CARICOM countries. And Alleyne in his review of the literature on remittances indicated the following: for the developing world, remittances may very well be a booster in foreign exchange terms to reduce that world’s current account deficit on the balance of payments; remittances could increase
The Table
national income via a collection of national savings; remittances could enhance the local capital sector with a view to raise import productivity levels; remittances also help people with low income, people with no collateral capacity, who have no chance of securing loans. But like so many useful mechanisms to aid development, remittances also carry drawbacks.
According to Ratha and Orozco, migrant remittances to Latin America and the Caribbean amounted to about 25.3 percent of global flows in 1998 which increased to 31.2 percent in 2002.
The Table shows that Jamaica, Guyana, Grenada, and Belize were strong recipients of migrant remittances, with Barbados inching up to the plate. As long as these countries continue to export their locals to the metropole, migrant remittances as a factor in these countries’ development will become pivotal.
Prem Misir
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