Immigrants send more money to Mexico despite pandemic
SAN DIEGO — Silvana Alaniz, the owner of the tiny El Rincon restaurant in San Ysidro, works from dawn to dusk alongside her entire immediate family. Even her 10-year-old daughter helps serve the clientele who often wait in lines that wrap around the block for Silvana’s locally famous menudo.
“We have five kids and they all cook,” she laughed. “They spend their summer days in this restaurant. I think that’s one of the reasons we’ve been surviving.”
But the restaurant supports not just her family in San Ysidro. Every month, Alaniz, 43, also sends money home to her father in Mexico.
The coronavirus pandemic slammed many immigrants who bused tables, picked crops and stood shoulder-to-shoulder in factories. But many have kept working in what are considered essential — if risky — jobs. And through the summer, Mexican immigrants like Alaniz living in the United States sent home record sums of money to their families, defying predictions that so-called remittances would plummet.
Mexico received $3.53 billion in remittances in July — most of it from the U.S. — a 7% increase over the same month in 2019, Mexico’s central bank data showed last week.
Even as the unemployment rate in the United States soared to 14.7% in April and the World Bank predicted global remittances would tank by about 20 percent, Latinos working in the United States baffled economists by sending more money home to Mexico and Central America than ever before.
In March, remittances hit their highest level since record-keeping began in 1995, spiking 36% to $4 billion. July was the thirdhighest level on record, central bank data showed.
The funds are a major support for the Mexican economy and low-income families across the country, supporting approximately 1.5 million families, according to the Mexican federal government.
“I think, initially, it was a surprise,” Ismael Plascencia, the faculty director of business at the Universidad Autonoma de Baja California, said of the rise in remittances. “But it makes sense. People in the United States are very worried for their families in Mexico — for their health.
“Workers in the U.S. made a great effort because they know that their families in Mexico do not have access to good health systems.”
To send money home, workers in the United States often go to a business that allows for international payment services or transfers, such MoneyGram or a Western Union. The businesses usually charge a fee and the exchange rate of U.S. dollars to pesos is usually slightly worse than is offered in banks.
The vast majority of remittances are done by electronic transfer. Of the $3.53 billion received by Mexico in July 2020, $3.49 billion was in electronic transfers, $24.9 million in cash and kind, and $12 million in money orders, data show.
The average remittance in the period from January to July was $337, 4.3% higher than the same period in 2019.