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Remittances: A Key Factor for Economic Change and the Reduction of Poverty in Latin America – The Case of Guatemala
Abstract
International remittances to developing countries are growing and are more than foreign direct investment or the official development aid. More of the 3.2% of global population are living abroad and the trends will increase in the next decades, involving skilled and no skilled workers. Developing countries in Latin America receives 15% of all international remittances and six countries (México, Guatemala, Dominican Republic, Colombia, El Salvador and Honduras) in the region received more of the 70% of all the remittances in 2013. By coincidence, this six countries have a lack to develop and large pockets of poverty, much of which is concentrated in those areas from which migrants come. The remittances are palliatives to poverty in their countries and help their families to reduce their poverty. In many cases, the remittances are the seed for new small and medium enterprises in Latin America, with not enough access to financial services.
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