2012年5月6日日曜日

3-18 Rather dangerous Monsieur Hollande


New rivers of gold
Remittances from unlikely places are helping poor countries in downturn

Why I picked up:
I am interested in a Japanese entrepreneur, Tochisako Atsumasa who is the president of MFIC (Micro Finance International Corporation) and his business. He founded his company in US. His company provides financial services especially remittances for mainly migrant workers from South American countries.


Discussion:
  1. Compared to other inflows such as direct investment, development aid (ODA) and trades, what are the merits and demerits of remittances?
  2.  What kind of impact growing remittances have in the world economy?

Summary:
1) The world’s most busiest remittance corridor
US => Mexico (=> Guatemala, Honduras) $22.2b

2) Remittances to poor countries are enormously valuable.
    Worth more than all overseas-development aid
Totaled $372b to poor countries in 2011

3) Remittances are not just big but growing  
    4 times bigger than 2000 despite economic crisis
 Reason for the boom: The data are better

4) Remittances come from wider countries than was previously thought
Originated in America 46% in 1970 => just 17% in 2010
 Saudi Arabia (the Gulf) posting $27b to South Asian and Africans
 Russia dispatching $19b mostly to Central Asia

5) Remittances are not immune to fluctuation though they are less volatile
 Cash flows to Mexico is 12% lower than their pre crash peak
 “The Arab spring”

6) Remittances are changed by currency fluctuation and immigrant policy
 Hit by weak dollars and euros, many migrants will react by spending longer or staying closer
 American stricter border controls keep migrants in as well as out

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