MEXICO

Remittances to Mexico

The end of the American dream

The recession up north bites in rural Mexico

THERE is a small, artificial lake, well stocked with carp. Around it loom hills covered in pink wildflowers. It looks idyllic. But the hills used to be sown with maize and the wildflowers are a sign that the workforce has left the fields fallow to toil in more profitable ones in the United States. Chincua, a village of some 700 people, is typical of the Mexican state of Michoacán, where remittances from migrant workers account for 12% of the local economy.

Amelia Cerezero, who lives in a one-storey cement shack in the village, looks after her five-year old grandniece. The girl’s mother, a building worker in Florida, used to send 1,500 pesos ($110) a week to them. But that stopped recently when she lost her job. And Mrs Cerezero’s sister has come back from Florida, reckoning it was better to be unemployed in Mexico.

Recession across the border means that remittances to Mexico fell by 4.2% between January and August compared with the same period last year, according to the World Bank. Surprisingly, Mexico’s central bank reckons this trend was bucked in October, when remittances rose sharply. Yet that might be ominous: the rise may come from migrants who have lost their jobs repatriating their savings before returning home.

According to the Pew Hispanic Centre, a think-tank in Washington, DC, the number of illegal immigrants in the United States has levelled off (at just under 12m) after years of growth. That is partly because of the American recession, but also because it is harder to cross the border. Mrs Cerezero and her husband tried repeatedly earlier this year but were caught each time. Now they have given up. Many people in Chincua have opted to stay at home with their families even if that means staying poor, says the village priest.

At least the slide in the value of the peso of around a third since September means that those remitted dollars go further. But that is cold comfort in Michoacán. A shopkeeper in the nearby town of La Frontera says that he used to sell four cases of beer a day, but is now down to two or three. A doctor in a private clinic, where a check-up costs just 100 pesos, says that business is down 30%. Around Chincua, half-finished houses, built bit by bit with money from the north, are the rule. Many now wonder whether they will ever be finished.

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