Mexico's woes deepen as U.S. lockdowns cut off remittance flows

Record ID: 1555345

  • Title: Mexico's woes deepen as U.S. lockdowns cut off remittance flows
  • Date: 2nd June 2020
  • Summary: SAN BARTOLOME QUIALANA, MEXICO (FILE - APRIL 3, 2020) (REUTERS) ROAD LEADING INTO TOWN ROAD SIGN WITH NAME OF TOWN VARIOUS, STREET VENDORS SELLING WARES POSTER WITH TITLE READING (Spanish) "COVID-19 PREVENTION" MUNICIPAL COUNCIL MEMBER, MARIA MARTINEZ GOMEZ, IN FRONT OF MUNICIPAL BUILDING (SOUNDBITE) (Spanish) MUNICIPAL COUNCIL MEMBER, MARIA MARTINEZ GOMEZ, SAYING: "There
  • Embargoed: 16th June 2020 16:50
  • Keywords: Mexico construction coronavirus family funding home immigration lockdown migrants money pandemic quarantine relatives transfer wire
  • Location: SAN BARTOLOME QUIALANA & OAXACA CITY, MEXICO
  • City: SAN BARTOLOME QUIALANA & OAXACA CITY, MEXICO
  • Country: Mexico
  • Topics: Government/Politics
  • Reuters ID: LVA001CGOHKXZ
  • Aspect Ratio: 16:9
  • Story Text: In countless dusty construction sites across rural Mexico, a side-effect of the coronavirus crisis is having a big effect on local economies: the drying up of the billions of dollars in remittances sent home by relatives working abroad.
    The World Bank has said it expects global remittances to low- and middle-income nations to fall by $109 billion, or almost a fifth, in 2020 to $445 billion. The bank projects the pandemic will cut into the wages and employment of migrant workers, who tend to be the most vulnerable when there is an economic downturn in host countries.
    In Mexico, most remittances come from the United States. Mexico saw a surge in transfers in March - which some analysts attributed to fears of deterioration of employment prospects in the United States and favourable exchange rates. But some analysts estimate remittances could shrink more than 21% between 2020 and 2021.
    The slowing flow is felt in the small town of San Bartolomé Quialana in Mexico's southern Oaxaca state, population 2,500. The money sent back to the town over the years has helped reduce poverty across generations and fuel a multi-year construction boom, according to municipal officials.
    But several empty building sites point to the pause in flow of cash from the United States. On a plot of land Francisco Mesinas was developing with cash from his three children in Los Angeles, metal rods stick out of the foundations of the construction site, while stacked concrete slabs and piles of shingle lay untouched with no workers in sight.
    The 30,000 to 60,000 Mexican pesos ($1,382 to $2,764) Mesinas' two sons and daughter had been sending each month for the project has dried up completely, after all three children lost their restaurant jobs in Los Angeles.
    Standing on red dirt on a site where three houses are to be erected, along with a space for a café and a small business, Mesinas said: "The work has stopped because they can't send money here anymore."
    (Production: Jose Cortes, Manuel Carrillo)
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