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As Latinos lose jobs, remittances to their relatives in Latin America dry up

“I couldn’t even pay rent this month,” a Miami resident from Guatemala said, "and we need to keep a little bit of reserves so we can eat.”
Image: Guatemala
Men look out on to an empty plaza outside the closed Santa Maria Catholic church in the largely indigenous town of Joyabaj, Guatemala on April 3, 2020.Moises Castillo / AP

MIAMI — Herminio Rodriguez could not send money to his family in Guatemala this month, after the Miami Beach restaurant where he was working closed several weeks ago.

Now Rodriguez, 41, worries about his parents and his son back home, who depend on the monthly remittance he sends to buy food and medicine.

“I couldn’t even pay rent this month,” Rodriguez said, “and we need to keep a little bit of reserves so we can eat.”

“The economic part is affecting us both here and there,” he said.

As Latinos throughout the U.S. grapple with job losses and lockdowns, many are no longer able to provide for relatives back home. The sudden end in remittances sent to Latin America each year is affecting the well being of families and crippling the economies of developing countries.

Many of those who send remittances often work in the service industry and have been let go or furloughed from their jobs in hotels, restaurants or cleaning companies, without pay. Those who are undocumented cannot apply for unemployment.

According to the World Bank, global remittances reached a record high in 2018, the last year for which figures are available. The flow of money to Latin America and the Caribbean grew by 10 percent to $88 billion in 2018, mostly due to the strong U.S. economy, where most of the money originates.

In many countries, remittances account for a significant portion of their gross domestic product. In Nicaragua and Guatemala they account for around 12 percent, and in El Salvador and Honduras, around 20 percent.

Mexico receives the most remittances in the region, with about $36 billion in 2018, up 11 percent from the previous year.

'How are we going to do this?'

Mexico's president, Andrés Manuel López Obrador, asked Mexicans in the United States not to stop supporting their relatives back home. He said February set a record in remittances to Mexico.

“Tell your countrymen to not stop sending help to their families in Mexico, who are also going through a difficult situation,” he said at a recent news conference.

In Miami, Edmundo Tarín, who emigrated from Mexico, heard about López Obrador’s statements and said: “How are we going to do this? I can’t even pay my rent.”

Tarín has always sent money to his brother, who depends on the monthly stipend to pay rent and buy food in Mexico City, where he lives.

Image: Guatemala
Women wearing protective face masks stand at a safe distance to help curb the spread of the new coronavirus, as they wait for food assigned to their children outside a school in the largely indigenous Xesuj village, Guatemala on April 3, 2020.Moises Castillo / AP

“This situation has limited us. We’re doing bad, very badly,” Tarín said, who was laid off from his job as a cook in a restaurant.

Manuel Orozco, an economist with the Inter-American Dialogue, said the drop in remittances is not only from the U.S., but from other Latin American countries as well.

"The distinction is important because in the past four to five years, we have seen significant growth in Latin American migration to other Latin American countries," he said.

'I am everything to my parents, and it's my responsibility'

The Caribbean and Latin American countries that have seen the most emigration are Haiti, Cuba, Venezuela, Nicaragua, Bolivia, El Salvador, Guatemala and Honduras.

The dependence on remittances is highest in these countries, which have more fragile economies.

Orozco said there could be a speedier economic recovery than from the 2008 financial crisis and that by June 2021, U.S. immigrant workers may remit similar amounts to February's total.

But for now, Lesbia Granados, 35, is worried after not being able to send money to her parents in Honduras last month.

They depend on her to pay for electricity, food, medicine and doctors’ visits. But the Miami Beach hotel where she worked is closed.

“I am everything to my parents, and it’s my responsibility to take care of them, after they did so much for me," she said.

Granados said she's hoping her coronavirus stimulus check arrives soon.

“Until then, I’m trying to survive with the little I have saved,” she said.

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