Latin America’s Unprecedented Remittance Growth in 2023
Local media report a record $155.908 billion in remittances to Latin America and the Caribbean in 2023, marking a 9.5% increase from 2022.
As per the Inter-American Development Bank (IDB), this rise continues a 15-year growth trend, reflecting new migration patterns and contributions from migrants to their home countries.
Amid Covid-19, 2021 saw a 26.7% jump in remittances. The IDB notes these remittances crucially reduce poverty and drive international migration.
In recent years, remittances have remained vital for recipient economies, maintaining a steady 2.5% ratio to regional GDP.
World’s Largest Migrant Population
Most remittance flows originate from the earnings of millions of Latin American migrants abroad.
Over 41 million Latin Americans live outside their countries, forming the world’s largest migrant population.
The United States and Spain are major destinations for these migrants.
The Panama-Colombia border, a key route to North America, saw an 86% increase in irregular entries in 2022, totaling 248,284, as per UN Migration.
Consistently, the IDB has recorded a 10% annual growth in remittances to the region over the past decade.
In 2023, South America contributed 18.9% to the region’s remittances, a slight decrease from 2022.
Europe, especially Spain, is a significant source of South American remittances. The United States also contributes notably, followed by other South American countries.
The U.S. remains the primary source of remittances for Ecuador, Guyana, Peru, Colombia, and Uruguay.
Spain holds a key role, particularly for Paraguay and Uruguay. In Bolivia, regional countries are the main remittance source.
Argentina saw a 26.3% increase in remittances due to its peso depreciation. Paraguay experienced a 20.3% growth, responding to economic changes in Argentina.
Other countries like Peru, Ecuador, Bolivia, Guyana, Uruguay, Colombia, and Chile also witnessed significant increases.
Brazil Saw an 8.7% Decline
However, Brazil saw an 8.7% decline compared to the previous year’s unusual growth.
In Central America, Nicaragua led with a 59% rise in remittances, followed by Costa Rica and Guatemala.
In North America, Mexico noted a 9.8% increase.
The IDB concludes that migration does not immediately impact remittances, as migrants need time to settle and find work.
The following are the countries in Latin America and the Caribbean that received the most remittances in 2023:
Mexico: $64.247 billion
Guatemala: $19.982 billion
Colombia: $10.202 billion
Dominican Republic: $10.125 billion
Honduras: $9.369 billion
El Salvador: $8.198 billion
Ecuador: $5.315 billion
Nicaragua: $5.127 billion
Brazil: $4.304 billion
Peru: $4.241 billion
Haiti: $4.165 billion
Jamaica: $3.558 billion
Bolivia: $1.586 billion
Guyana: $1.118 billion
Costa Rica: $675 million
Paraguay: $594 million
Panama: $493 million
Chile: $367 million
Trinidad and Tobago: $329 million
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