Countries in Latin America and the Caribbean are projected to receive a record-breaking US$156 billion in remittances this year, marking a 9.5% increase from the US$142 billion received in 2022, according to the Inter-American Development Bank (IDB).
This sustained growth trend, spanning the past decade, has seen remittances rise by an average of 10% annually. However, remittances to Mexico and Central American countries have exhibited a downward trajectory in recent years.
Central American nations are anticipated to receive approximately US$44 billion by the end of 2023, with the majority of these funds originating from the United States. While Mexico witnessed a 13% surge in remittances in 2022 compared to the previous year, this growth rate is expected to moderate to around 9% in 2023.
Caribbean countries, which also experienced a decline in remittances until 2022, are now set to receive a significant boost in remittance inflows this year. Trinidad and Tobago stands out as the Caribbean nation with the highest remittance inflows from its diaspora in the United States.
The surge in remittances reflects an increase in the income of migrants, who have benefited from higher employment rates.
The United States remains the primary source of remittances globally, accounting for over 60% of the total, while Europe contributes approximately 13%. Notably, more than a quarter of all remittances originate from within the Latin America and Caribbean region itself.