Colombia completed a record number for the eighth consecutive year in remittance income last year, which means that Colombians received a total of 9.427 million dollars from family and friends living abroad. On average, every day of 2022, about 26 million reached their pockets for this concept, according to figures collected by the Bank of the Republic.
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The data represented an increase of 9.7 percent compared to 2021 when the figure amounted to 8,595 million dollars, and compared to a decade ago, it meant an increase of 137 percent, which represents the dynamism that these resources, which in most of them are labor income of Colombians.
The impact of these resources has been analyzed in various studies that have shown the social and economic impact that they represent for several regions of the country.
And precisely, in the last decade, the income of these resources reached 66,650 million dollars, according to the records of the Bank of the Republic.
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Reviewing the figures, during October, the month in which there was a strong devaluation of the peso against the dollar, since it reached close to 5,000, it was the month that lost the largest income of remittances, with 894 million dollars, that is to say that in that period alone those resources may have represented close to 4.5 trillion pesos.
In contrast, the month of February was when fewer remittances entered the country last year, and the record was 647 million dollars. In December, Colombians abroad sent 849 million, which was the third highest record in 2022.
A few weeks ago, the Banco de la República presented the remittance report that arrived in Colombia from the exchange balance, and in it the figure for last year amounted to 10,981 million dollars.
restlessness for duration
As in all economic phenomena there are cycles, that of the good run that these resources have registered, some consider that they could, although they do not fall, moderate their growth, although others say that they will remain high.
This, based on the latest announcements of a possible slowdown in countries like the United States, where more than 50 percent of these incomes come from. Diego Rodríguez, CEO of Bosk Capital, states that in theory remittances should slow down, but in practice “I think the boom in remittances to Colombia will continue. We will continue to grow on that front.”
Consider that despite a possible slowdown, employment in United States and Europe stays strong. Especially the one related to services.
Another factor that he mentions is that the price of the dollar makes temporary jobs very attractive. “The minimum wage in the United States is around 4,000 a month. With this, a person goes and works in a trade for 3 to 6 months and generates a much higher income ”, he assures.
In addition, he said that “the immigration part for temporary jobs is open and it is an option, without counting the option that some take to do it without documentation. This flow of resources is inflationary, the high dollar boosts it and it is difficult to control via interest rates”.
For his part, Juan David Ballén, Head of Economic Research at Casa de Bolsaensures that the developed economies, starting from the United States and passing through Europe, which is where the largest amount of remittances comes from, will present lower economic growth than in 2022.
Thus, “it is to be expected that unemployment will not continue to decrease or eventually rise, which would end up influencing a lower inflow of remittances to our country. Due to the foregoing, lower economic growth is also expected this year in Colombia, since a lower inflow of remittances would cool down household consumption a bit,” says Ballén.
For his part, Sergio Olarte, Chief Economist at Scotiabank Colpatriaconsiders that “in any case there is a space for workers’ remittances to continue reaching the Colombian economy, since that part of unskilled work that continues to be in significant demand in that country is the one that sends the most resources to Colombia” .
The Scotiabank Colpatria analyst anticipated that for this year the figure for this concept could easily exceed 10,000 million and even 11,000 million dollars.
The origin
The largest migratory registry of Colombians is the United States, which is why the largest amount of money in remittances comes from there, followed by Spain, a country that began to show the number of thousands of Colombians 15 years ago, captured by the language and the high income.
Recently an analysis of w bank, that mobilizes a significant amount of remittances, said that by 2023 a significant impact is expected in the sending of these resources to the country, as a result of factors abroad such as the increase in rates, the economic contraction (or very low growth) and the Possibly increased unemployment.
“All the above factors and adding the results of the economy in Colombia, generates a space for reflection in those who receive this money so that they can save it for the future,” he says.
HOLMAN RODRIGUEZ MARTINEZ
Journalist Portfolio