Frontera NorteSur

    In the first trimester of 2010, the amount of dollars sent by migrant workers in the US to Mexico registered the worst seasonal plunge in five years, the Bank of Mexico reported this week. According to the country’s central bank, about $6.6 billion in remittances entered the country’s economy during the first four months of 2010. The sum was nearly 9 percent less than the $7.25 billion received during the same period in 2009.

    Averaging slightly more than $316, the typical remittance also was less than the amount received during the first trimester of 2009.

    Prior to the 2008 economic crash, migrant remittances had topped more than $24 billion annually.

    The good news for analysts from the Bank of Mexico and the Spanish-owned BBVA Bancomer bank was that positive tendencies emerged during the last two months, suggesting the remittance free-fall might have hit rock bottom. In April, remittances of $1.78 billion showed a slight gain of 0.23 percent, while preliminary reports showed dollars captured during the month of May were also on the upswing.

    Analysts cited some upticks in US economic activity as favoring a positive trend, but also cautioned that continued high levels unemployment and the uncertain effects of Arizona’s anti-immigrant SB 1070 law, scheduled to go into effect next month unless it is overturned in court, could complicate the remittance recovery picture.

    Still, one leading observer predicted economic forces would eventually submerge SB 1070 and related anti-immigrant measures.

    “Economic reality will definitely prevail, contended Moises Jaimes, director of Bancomer Transfer Services. “Let’s remember that migrant labor, at a reasonable cost and of good quality is an anti-inflationary measure that definitely helps produce goods and services at a lesser and controlled cost. This is perfectly part of the US economy.”

    Jaime’s firm processes at least 40 percent of the migrant dollars sent from the United States.

    Migrant remittances represent the second source of legal foreign exchange for Mexico, coming in only after petroleum exports. During the first trimester of 2010, oil income amounted to $11 billion, in comparison with the $6.6 billion in migrant remittances.

    However, long-term trends favor migrant remittances as Mexico’s principal source of foreign exchange in the future. According to multiple reports, Mexico only has about nine years of easily recoverable oil resources remaining. On the other hand, a youthful population with few employment prospects coupled with aging trends in the US workforce puts migrant labor in a favorable position as a primary source of dollars.

Frontera NorteSur (FNS): on-line, U.S.-Mexico border news Center for Latin American and Border Studies New Mexico State University Las Cruces, New Mexico.