The Guaraní country registers 7.4% of the amount remitted, a lower percentage than in 2022 when the cost of sending US$ 200 was 8.4%.
Migrant remittances are cash or in-kind transfers made by migrants to their families in their countries of origin. They also include the remuneration of employees, such as cross-border workers, according to the International Organization for Migration – IOM/United Nations-UN.
However, for authors such as Carling (2008: 46-48), not all of them correspond to the stereotypical form mentioned above (money is not always sent to the migrants' country of origin, nor is it always sent by the migrants themselves, etc.).
While other specialists propose the concept of "social remittances" to designate non-monetary flows (ideas, values, norms, practices, skills, aspirations, etc.) that circulate between migrants and their societies of origin, and may have consequences on development (Levitt and Lamba Nieves, 2011).
United Nations data show that the approximately 200 million migrant workers worldwide send remittances to more than 800 million family members. Their estimates indicate that the average family remittance is between US$200 and US$300 per month.
Meanwhile, a World Bank (WB) report states that, after a period of strong growth during 2021 and 2022, remittance flows officially sent to low- and middle-income countries moderated in 2023 and reached an estimated US$656 billion.
During the pandemic, remittances represented a very important component for thousands of families, despite the decline recorded in some countries. Sending money meant a vital means of support for households, namely food, health and education. With millions of people out of the labor market, and therefore affected in their income, remittances meant the cushion to mitigate the impacts of the health crisis.
SOURCE OF EXTERNAL FINANCING IN THE FACE OF A COMPLICATED SCENARIO
During 2023, remittances grew by approximately 0.7% compared to 2022. Although the increase was not as significant as in previous years, the inflow of resources for developing countries did represent an important source of external financing and contributed to strengthening their current accounts affected by food insecurity and debt problems, among other factors.
In the same context, last year, remittances exceeded foreign direct investment and official development assistance, according to a World Bank study.
He adds that this positive dynamic is occurring even though sending remittances represents an expensive operation. Thus, in the fourth quarter of 2023, the global average cost of sending US$ 200 was 6.4% of the amount sent, slightly higher than the 6.2% of the previous year. In Latin America and the Caribbean (LAC) it was 5.8%, above the 5.6% recorded in 2022.
Looking at the countries, Cuba, Guyana and Suriname have the highest costs. Paraguay is below the aforementioned economies with 7.4% of the amount remitted, a lower percentage than in 2022 when the cost of sending US$ 200 was 8.4%.
These figures remain above the 3% or less target set in the Sustainable Development Goals (SDGs) for 2030. However, digital remittances were cheaper at 5% compared to 7% for non-digital methods, highlighting the benefits of technological advances in reducing the financial burden on migrants.
In 2023, remittance flows to LAC slowed by 7.7%, reaching around US$156 billion. For 2024, the outlook indicates that flows would increase by 2.7%, according to World Bank data.
In Paraguay, remittances have been growing steadily over the last 10 years (except during the pandemic period). According to reports from the Central Bank of Paraguay (BCP), the average inflow of foreign currency into the country from money sent by Paraguayans living and working abroad was over US$ 500 million between 2013 and 2023, with slight reductions during the pandemic.
By the end of July 2024, family remittances totaled approximately US$ 400 million, an increase of 15% compared to the same month of the previous year.
