Remittances received in Latin American and the Caribbean during the first half of 2022 reached US$68 billion, continuing the growth trend that has been observed since the second half of 2020 and detailed in the publication “Remittances to Latin America and the Caribbean in 2021. Migrant Efforts During the COVID-19 Crisis”.
In the first quarter, remittances grew to US$31.7 billion, 14% higher than in the same period of the previous year, while in the second quarter they registered US$36.3 billion, 17% higher than the second quarter of 2021, and the highest value recorded in a single quarter ever.
In line with our previous projections, for the full year the expectation is still for growth of remittances to LAC of between 14% and 15%, less than what was observed last year and closer to the historical trends. This growth is supported by improvements in the economies of the countries where most LAC emigrants reside and attenuated by the inflationary prospects that are present in the coming months that will affect the disposable income of migrants available for remittances.
The remittances received in the countries of Central America in the first quarter of 2022 reached US$ 8.6 billion and during the second quarter hit an all-time high of US$ 10 billion, 17.9% higher than that observed in the same quarter of 2021.
Remittances received in Nicaragua during the second quarter grew most, 38.7%, due to the strong year-on-year growth of 42.1% observed in May of this year, followed by those to Guatemala, 24.6%, with growth in May of 42.2% compared to the same period in 2022. The strong growth observed in all of Central America during the first half was due to strength of the labor market in the United States and the typical seasonality of the May data, which also propelled the growth of remittances received in Honduras (18.0%), Costa Rica (4.4%), and El Salvador (1.5%).
The forecast for the full year in Central America is a continuation of the growth rate of inflows of remittances, reaching an annual rate of between 17% and 18%.
Remittances received in Mexico in the second quarter of the year reached a new quarterly record, at US$ 15 billion, or 20.6% higher than the previous quarter and 15.4% above the same quarter last year.
In the projection for the end of year, it is expected that Mexico will receive a similar flow of remittances, with an expected annual growth of between 13.5% and 14.5%, much lower than that observed in 2021, and closer to the long-term trends.
The remittances received in the countries of South America reached a new quarterly record of US$ 6.8 billion in the second quarter, 8.3% above the previous quarter and 12.3% greater than the same quarter in 2021.
Argentina and Brazil were the countries whose remittances grew most during the second quarter, 31.1% and 16.5% respectively compared to the same quarter last year, driven by the recovery of employment in the countries where their emigrants reside, and by the depreciation of the peso in the case of Argentina. Paraguay registered a decline of 5.1% in remittances received during the second quarter due to the unusually high levels of remittances they received in the same quarter last year, even though the Q2 2022 levels are well above the level from two years ago.
In line with recent trends, remittances received by Chile and Ecuador grew 13.8% compared to the same period a year ago, while those to Colombia and Peru grew a bit less, at 11.5% and 7.3%, respectively. Remittances received in Bolivia also grew, though a bit less, by only 3.7% compared to the same quarter in 2021.
Projections for the year are that the subregion will see remittances growth above the 2021 level, at between 13.5% and 14.5%.
Remittances received by countries of the Caribbean in the second quarter of the year reached US$ 4.5 billion, 4.1% above the previous quarter and slightly higher (0.4%) than the same quarter last year.
he Dominican Republic showed a significant decline in remittances received in the second quarter, 9.2% below the same quarter last year due to the exceptionally high level received in Q2 of 2021, Despite this reduction, the level was still well above pre-pandemic levels for the second quarter, as flows appear to be converging to the longer-term trend. For the same reason, remittances to Jamaica and Trinidad and Tobago are those that grew most, 9.9% and 43%, respectively, as these countries showed much lower growth last year (negative in the case of Trinidad and Tobago) relative to trend. For its part, Haiti received remittances that were higher than the same quarter last year by 1.8%.
The projection for the year-end figures is that the subregion will receive remittances between 2% and 3% higher than in 2021.