Mexico sees decline in migrant remittances

July 30, 2008 - 7:09AM
Associated Press

MEXICO CITY (AP) -- Half-year figures are expected to show the first sustained decline on record in remittances sent home by Mexicans working abroad, officials said.

The downturn in U.S. housing construction and stepped-up immigration raids have made it tougher for migrants to find jobs, and less able to send money home. Mexico's Central Bank is scheduled to release figures on the remittance flow on Wednesday.

Jesus Cervantes, director of economic measurement for Mexico's central bank, said remittances are expected to decline 1.5 percent to 2 percent for 2008 as a whole over the previous year.

Cervantes said that would be the first such sustained drop since a reliable tally has been kept.

Annual remittances nearly tripled from about US$9 billion in 2001 to almost US$24 billion in 2007, amid improved reporting methods and swelling immigration.

Businesses in many Mexican towns that came to rely on the cash flow are now being forced to scale back - also in part because of the decline of the U.S. dollar, which has lost almost 8 percent of its value against the Mexican peso this year.

Money sent home by Mexican migrants is the country's second-largest legal source of foreign income, after oil exports.