March 14, 2011; Source: Wall Street Journal | Comparative studies of charitable generosity by ethnic/racial groups in the U.S. have often been troubling for their cultural blindness. For Hispanic immigrants in the U.S., a major form of charitable giving is sometimes not counted as charitable. That’s because their gift is the money that they send to their home countries for their families and, frequently, entire communities.
According to the International Fund for Agricultural Development, remittances from migrants in developed countries, to most Latin American countries have increased significantly as of the beginning of 2011. Remittances to Guatemala, Honduras, El Salvador, and Mexico were between 6 and 16 percent higher in January 2011 than a year earlier.
According to the Inter-American Development Bank, overall remittances dropped significantly – 15 percent – between 2008 and 2009, particularly because of the impact of the recession in the U.S., Spain, and Japan, but IADB figures for 2010, to be officially released next week, will show a modest increase of 0.2 percent.
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Total remittances in 2010 were $58.9 billion. There were differences among Latin American countries. Remittances to Ecuador dropped 7 percent in 2010, a not inconsequential sum given that remittances account for the country's second largest U.S. dollar income earner after oil exports. Similarly, in Mexico, where remittances were largely flat in 2010 (though increasing sharply in January 2011), remittances follow oil exports but exceed tourism as a U.S. dollar income generator.
This isn't true just for Latin American countries. Remittances to the Philippines are very large and have been growing in 2010 and early 2011. Like charitable and philanthropic giving to U.S. nonprofits with direct and indirect economic development implications, immigrants' remittances are important bulwarks for the economies in the immigrants' home countries. These financial transfers may not look like traditional charitable giving to 501(c)(3) public charities, but they function frequently in similar ways with similar impacts.—Rick Cohen