Dec 142013
 

The Institute for Economics and Peace (IEP), an independent, non-profit research organization dedicated to promoting a better understanding of the social and economic factors that develop a more peaceful society, has released its first Mexico Peace Index. The 2013 Mexico Peace Index (MPI) is based on a similar methodology as previous IEP indices, including the United States Peace Index and the United Kingdom Peace Index; however specific measures were included to better reflect the specific Mexican cultural and national context.

For the Mexico Peace Index, seven indicators were used to analyze peace: homicide rates, violent crime, weapons crime, incarceration, police funding, efficiency of the justice system, and the level of organized crime.

The study was performed with the guidance of an Expert Panel representing various institutions such as IMCO, CIDE, Mexico Evalua and INEGI. The Mexico Peace Index 2013 uses data provided by INEGI and the Executive Secretariat of the National Public Security System (SESNSP).

Mexico Peace Index

Mexico Peace Index. Credit: Institute for Economics and Peace.

The headlines

  • Mexico Peace Index finds that peace improved 7.4% in past two years
  • The two-year improvement in peace was primarily driven by a 30% decrease in organized crime
  • Most peaceful states experienced an annual GDP growth of more than double the least peaceful states
  • Oaxaca, Chiapas, and Yucatan have the most improved levels of peace in the past decade
  • Mexico has the greatest potential in the world to overcome its current levels of violence and build a more peaceful society, with a strong business environment and high levels of human capital
  • The eastern region of Mexico is the most peaceful; the northern region the least

The 2013 MPI provides a comprehensive assessment of peace in Mexico detailing the level of peace in each of the 32 states over the last 10 years and an analysis of the costs associated with violence as well as the socio-economic dimensions associated with peace.

mpi-coverThe study finds that there was a 7.4% improvement in Mexico’s peace scores in the last two years, driven by decreases in organized crime, violent crime, and weapons crime. However, over the past 10 years Mexico experienced a marked increase in direct violence, with peace declining by 27%. A key factor was the 37% increase in the homicide rate since 2007.

The 2013 MPI presents comparisons between the states and the regions of Mexico, and finds that the states with the highest levels of peace are: Campeche, Queretaro, Hidalgo, Yucatan and Baja California Sur while the five least peaceful states are: Morelos, Guerrero, Sinaloa, Chihuahua, and Quintana Roo.

The study finds that Oaxaca, Chiapas and Yucatan experienced the most substantial increases in their levels of peace during the last decade. Oaxaca improved its score by 22% and Chiapas by 17%.  These states were found to be relatively peaceful in comparison with other areas of Latin America and North America. Campeche, for example, has a level of peace comparable with the states of New Mexico and Delaware in the United States.

Regionally, the research finds that the eastern region of Mexico is the most peaceful, while the northern region is the most violent.

Analysis of federal funding to state police (Fondo de Aportaciones para la Seguridad Publica) finds that increases in police funding are related to crime reporting rates, with increased funding improving the public’s relationship with the police.

The direct cost of violence to the Mexican economy is 3.8% of GDP, while the indirect costs amount to 12% for a total 2.49 trillion pesos (15.8% of GDP). Under optimal conditions, if there was no violence in Mexico, the economy would have the potential to improve by up to 27%. This figure includes direct and indirect costs and the additional flow-on economic activity that would eventuate from new money being added to the economy. The study highlights that if all the states of Mexico were as peaceful as Campeche, the most peaceful state in the country, Mexico would reap an economic benefit of 2.26 trillion pesos.

The most peaceful Mexican states in 2003 experienced the strongest economic performance in 2012. Over the past 10 years, these states’ GDP increased by 9% versus 4% in the least peaceful states.

Steve Killelea, founder and executive chairman of IEP said: “Compared to other countries with a similar level of conflict and development, Mexico has the greatest potential to increase its peace on account of the strength of the structures, attitudes and institutions that sustain peace in the long term.” He added that: “This research aims to provide the evidence base and data for a broader policy debate about how to reduce violence in Mexico”.

Mexico’s standing in regards to positive peace is encouraging: the country has a strong business environment, performs well on measures of human development, and ranks better than world averages on education.

Factors impacting peace in Mexico

It is well known that the increase in the levels of violence in Mexico has been a consequence of the war against drug trafficking, but there are other key factors at play.

The number of firearms smuggled into Mexico increased substantially during the last decade, almost three times higher in the period 2010-2012 than between 1997 and 1999.

As a consequence, the weapons crime indicator, which measures the number of offenses involving the use of weapons, recorded a significant increase of 117% per 100,000 people during the last decade.

The measure of the efficiency of the justice system has recorded a significant deterioration. In some states up to 95% of homicides remain unpunished.

In addition, the public perception of corruption is very high and one of the greatest challenges facing Mexico.

Prison capacity is overstretched with a Mexico Evalua 2013 report stating that 52.4% of prisons in the country are over-crowded and house 74% of the prison population in Mexico.

There is a high level of unreported crime in Mexico. According to data from the National Survey of Victimization and Perception of Public Safety 2012 (ENVIPE), only 19% of theft, 10% of fraud and 10% of extortion cases are reported.

It is important to address all of these key challenges in order to reduce violence and realise the social and economic benefits of peace in Mexico.

This post is the text of a press release from the Institute for Economics and Peace. For more information about the report, visit http://visionofhumanity.org/#/page/news/812 and http://visionofhumanity.org/#/page/indexes/mexico-peace-index

The full 96-page report – available here - is well worth reading and offers many more insights into the changes taking place in Mexico.

Related posts:
Dec 122013
 

Today is 12 December, the feast day of Our Lady of Guadalupe, the beloved indigenous patron saint of Mexico and much of the Americas. This seems like a good excuse, if ever one was needed, to revisit the “Gender Gap” in Mexico. The gender gap assesses the “gap” between females and males for a number of variables, but should not be taken as reflecting the quality of life of females in different countries.  For example, the gender gap between women in Japan and Japanese men is very large, even though Japanese women enjoy a relatively high quality of life.

In “The Global Gender Gap Report 2013″, the World Economic Forum (WEF), based in Geneva, Switzerland, placed Mexico 68th of the 136 nations included in the study. Between them, the 136 nations house 93% of the world population. Mexico has risen 16 places in the rankings since 2012, meaning that the gender gap in Mexico is narrowing, even if there is still a long way to go to reach gender equality. (It is worth noting that Mexico has been climbing steadily up the rankings for several years, from #98 in 2009, to #91 in 201, #89 in 2011 and #84 in 2012).

Of the 136 countries studied for the 2013 report, Iceland had the smallest gender gap, for the 5th year running, followed by Finland, Norway and Sweden.

Among Latin American nations, Nicaragua had the smallest gender gap (placing 10th in the world), with Cuba, which has the highest female participation in government, coming in 15th and Brazil remaining 62nd. Other notable placings were Germany 14th, and South Africa 17th.

gender gap graph for Mexico

How Mexico (country score) compares to other countries (sample average). Source: Gender Gap Report 2013

The Gender Gap Index is a composite index comprised of a number of variables grouped into four key areas:

  • health and survival
  • educational attainment
  • political empowerment
  • economic participation

As noted in our summary of the 2012 Gender Gap Report, Mexico ranks #1 in the world, tying with several other countries, for the health and survival subindex. This means that Mexican females are unsurpassed with respect to sex ratio at birth (female/male) combined with female life expectancy (female/male).

For the other subindexes, in 2013 Mexico ranked #36 for political empowerment and #70 for educational attainment, but a lowly #111 for economic participation.

Geo-Mexico agrees wholeheartedly with Klaus Schwab, founder and executive chairman of the World Economic Forum, who called for renewed efforts to ensure gender equality, saying that, “Countries will need to start thinking of human capital very differently – including how they integrate women into leadership roles. This shift in mindset and practice is not a goal for the future, it is an imperative today.”

Related posts:

Dec 092013
 

Background: The Valley of Mexico is an interior basin about 9000 square km in area. The basin floor sits at an elevation of 2200 meters above sea level and is surrounded by mountains that rise up to more than 5000 meters above sea level. It receives around 700 mm of rainfall a year, with a rainy season from late May to September.

The basin was originally the site of several lakes and marshes, and much of it is underlain by lacustrine sediments up to 100 m thick, beneath which are alluvial sediments up to 500 m thick (see geological cross-section below). These sediments are interstratified with layers of volcanic basalt. Beneath the alluvial sediments are 100 m to 600 m of volcanic deposits, which form the principal Mexico City aquifer (found about 500 m to 1000 m below Mexico City).

As Mexico City has grown, and water demands have increased, this main aquifer has been greatly overexploited, leading to a drop in the level of the water table underground, accompanied by ground subsidence that has had serious consequences for Mexico City:

Feasibility study of a deep aquifer

The National Water Commission (CNA) and Mexico City Water System (SACM) are undertaking a 3-year, 23-million-dollar feasibility study to assess the potential of an aquifer that lies more than 2000 meters below Mexico City. (Our earlier, initial report about this aquifer is here).  The project includes experts from Pemex, CFE and UNAM’s Institute of Geophysics.

Schematic stratigraphy of the southern portion of the Basin of Mexico.

Schematic stratigraphy of the southern portion of the Basin of Mexico.
Source: Adapted from Mooser, 1990.

Initial exploratory wells have shown that the deep aquifer’s water quality is superior to that currently derived from the overexploited shallower wells that extend to depths of around 800m.

It is hoped that the feasibility study will confirm that water from the deep aquifer could be an additional viable source of freshwater for the city. Assuming the deep aquifer is hydrologically independent of the shallower aquifers, this  would not only reduce the need to pump water from the shallower aquifers, but would also avoid the ground subsidence resulting from continued shallow-water extraction. The feasibility study will assess whether or not the deep water aquifer is “fossil” water or is still being recharged from precipitation and underground throughflow. If it is being recharged, the experts will calculate its recharge rate to determine the aquifer’s maximum sustainable yield. (The maximum sustainable yield is the “additional groundwater output from the system which will cause minimal and acceptable levels of stress to the ecosystem with maximum benefits to the society and to the economy”).

The first test well is likely to be sunk in the Magdalena Mixhuca Sports City area, in the eastern part of Mexico City.

This potential deep aquifer source of freshwater could play a vital part in ensuring that future generations of Mexico City residents have a dependable and sustainable water supply.

Mexico’s consideration of utilizing deep water aquifers runs counter to the prevailing wisdom in the US where it has long been argued that deep water aquifers will be too costly to utilize for fresh water, will never be used, and are therefore more useful as a repository for waste and can be intentionally polluted.

As a result, as this Huffington Post article explains, “policy-makers often exempt these deep aquifers from clean water protections and allow energy and mining companies to inject pollutants directly into them.”  The article adds that, “the U.S. Environmental Protection Agency has issued more than 1,500 permits for companies to pollute such aquifers in some of the driest regions. Frequently, the reason was that the water lies too deep to be worth protecting.”

References:

Mooser, F. 1990. “Estratigrafía y estructura del Valle de México en el subseulo de la cuenca del Valle de México y su relacíon con la Ingeniería de cimentaciones, a cinco anos del sismo”, in Revista de la Sociedad Mexicana de Mecánica de Suelos. Mexico, D.F.

For a detailed description of Mexico City’s shallower aquifer and its exploitation, see Mexico City’s Water Supply: Improving the Outlook for Sustainability (1995) (viewable online or register for a free download)

Related posts:

Dec 072013
 

In the mid-sixteenth century, the Spanish Court was determined to acquire accurate information about everything being encountered in New Spain. This led to a series of censuses and accounts, including the Relaciones geográficas (Geographic Accounts).

The basis for the Geographic Accounts was a 50-question survey, sent to New Spain in 1577. The authorities in each administrative center were instructed to call a meeting of the “Spaniards and other natives in the district”, to find out everything they could about the area’s geography, people and history.

Of the 191 known responses to the 1577 questionnaire, 167 have survived in archives to the present day. Most of the original responses are housed in Spain, in either the Archivo General de las Indias in Seville or the Real Academia de la Historia in Madrid, while a further 43 responses form part of the Benson Latin American Collection in the University of Texas library in Austin. (The library’s webpage about the Relaciones geográficas has several links to images of sample pages and maps).

Map of Zempoala area from the Relaciones Geográficas

Map of Zempoala area from the Relaciones Geográficas (1577)

The accounts contain a wealth of information about population, relief, flora, fauna, economic activities and lifestyles. Some also include maps of the areas being described. However these early maps do not follow modern conventions in terms of having a uniform scale across the area being shown, or an orientation that is consistent in terms of compass directions. They are pictorial maps, where the scale varies across the map, and where areas are delimited, or places are linked, without apparent regard for direction.

One such map (see image above) depicts the area around Zempoala (Hidalgo). This is analyzed by Barbara E. Mundy, Associate Professor of Art History at Fordham University, in an online article, Mapping Babel: A Sixteenth-Century Indigenous Map from Mexico, published in The Appendix, a “journal of narrative and experimental history”. In the article, Mundy provides a detailed, step-by-step account of the map, with lots of additional related images and information.

Detail of map, showing Tepemayalco

Detail of map, showing Tepemaxalco

Mundy’s analysis reveals several “acts of translation” that have been made by the indigenous artist(s) presumed to be responsible for drawing the map.

For example, the artist(s) made the Spanish paper provided for the map more closely resemble its indigenous counterpart (bark paper), by joining sheets together to create the size they wanted for the map. In addition, unlike modern maps where the viewer is essentially static, with the map details arranged around them, indigenous maps demand changes of perspective, mobile viewers, who have to reorientate themselves depending where they are on the map in order to see things clearly.

Many of the images are a translation, perhaps of similar European images. For instance, like most towns on the map, Tepemaxalco is shown with “a conventional sign for a Christian chapel: a small building drawn in perspective with one side marked by a shadowing grey wash, topped with belfry and cross.”

The map also links the pictograph for each place name to its name written in alphabetic script. “The pictograph for Tepemaxalco (see image) registers some of its Nahuatl components: tepetl, ‘hill,’ maitl, ‘hand,’ xalli, ‘sand’ and co, ‘place of.’ Below, the name is written in alphabetic script, probably introduced by the Franciscans who evangelized this region.”

The dominant pictogram on this map is that for Zempoala (written “Cenpoballa” on the map). Mundy offers an interesting interpretation of this pictograph, which we hope to examine further in a future post.

Further reading

Barbara E Mundy. 2001. The Mapping of New Spain: Indigenous Cartography and the Maps of the Relaciones Geográficas.

Related posts:

Dec 052013
 

After studying 22 countries with sizable retirement communities, International Living (a consultancy group) rated Mexico as the fourth most attractive country for foreigners to retire to in 2013, after Ecuador, Panama and Malaysia. The study looked at eight factors: real estate, benefits for retired people, cost of living, integration, entertainment, health, infrastructure and climate.

According to the US Census Bureau, there are 41 million people of retirement age in the USA. More than half of them have annual incomes of between 70,000 and 150,000 dollars, and they are expected, on average, to live to the age of 83; 80% are home owners. This number will swell to 72.8 million by 2030, 40% of whom may have difficulties maintaining their previous lifestyles during retirement. Given its proximity, this makes Mexico an attractive destination for many baby-boomers seeking a comfortable retirement lifestyle.

But where in Mexico will these retirees choose to live?

According to this analysis by the consultancy Aregional, there are 36 specific areas in Mexico where the real estate market is targeting US baby boomers seeking a place to retire. About half of these locations (see map) are in central and western Mexico. Locations in these regions include Guanajuato and San Miguel de Allende (both in the state of Guanajuato), Colima, Comala and Manzanillo (Colima); Chapala, Ajijic and Puerto Vallarta (Jalisco); and Nuevo Vallarta and Punta Mita (Nayarit).

Locations of retiree real estate developments. Credit: Aregional

Locations of retiree real estate developments. Credit: Aregional

Locations in northern Mexico important for retiree real estate include Rosarito, Ensenada and Los Algodones (Baja California); Los Cabos, La Paz and Loreto (Baja California Sur); Puerto Peñasco (Sonora) and Mazatlán (Sinaloa). [Kudos to RickS for noticing that Puerto Peñasco is not located very accurately!]

Retiree real estate is also prominent in several places in the south and south-east of Mexico, including  Acapulco and Punta Ixtapa (Guerrero); Huatulco (Oaxaca); Playa del Carmen and Cancún  (Quintana Roo); Puerto Progreso (Yucatán), as well as the cities of Campeche and Veracruz.

It is not known how many US retirees have already chosen to live in Mexico. While it is relatively easy to quantify the number of retiree tourists (those staying more than one night, but less than six months), it is impossible to accurately quantify the number of non-working, non-Mexicans who have chosen to relocate full-time to Mexico. Technically, these “residential tourists” are not really tourists at all but longer-term migrants holding residency visas.

Residential tourists already form a very distinct group in several Mexican towns and cities, with lifestyle needs and spending patterns that are very different from those of regular tourists. Their additional economic impact is believed to exceed $500 million a year.

A case study of residential tourism, and its pros and cons, in Chapala-Ajijic on the northern shore of Lake Chapala is an integral part of chapter 19 of Geo-Mexico: the geography and dynamics of modern Mexico.

Posts related to retirees in Mexico:

Dec 022013
 

Despite the criticisms regularly leveled at it, Mexico’s oil giant Pemex is actually one of the most competitive oil firms in the world.

First, its costs of exploration and production are much lower than those of most other major oil companies. Pemex’s production costs in 2012 averaged 6.84 dollars/barrel (d/b) of oil equivalent, well below the costs incurred by international rivals Exxon (9.91 d/b), Chevron (15.16), Total (8.17), Shell (12.47) and British Petroleum (12.50).

pemexPemex’s exploration and development costs are also among the world’s lowest. They fell from 16.13 d/b in 2011 to 13.77 d/b in 2012, mainly due to the discovery of several new reserves. Among major players, only Shell had lower costs (11.75 d/b), with Pemex well ahead of British Petroleum (17.37 d/b), Exxon (19.31), Total (22.68) and Chevron (28.81).

Thirdly, as new fields are fully explored, Mexico’s proven oil reserves are expected to continue to rise for a number of years, from the current level of 13.87 billion barrels to 14.92 billion barrels by 2018. (During this period, Pemex will extract an estimated 6.64 billion barrels, but they will be more than replaced by anticipated new discoveries)

How important is Pemex to the Mexican economy?

One third of Mexico’s national budget comes from the petro industry, which accounted for 7.6% of GDP in 2012.

In 2012, Pemex invested 23.9 billion dollars in Mexico, appreciably more than the 19.2 billion dollars invested that year by América Móvil, Femsa, Walmart, Frisco, Cemex, Liverpool, Alfa and Mexichem, combined…

In terms of revenues, Pemex had revenues in 2012 of 142.4 billion dollars, greater than the 139.1 billion dollars in revenues of América Móvil, WalMart, Femsa, Alfa and Cemex combined.

According to a Bloomberg analysis, between 1973 and 2012, Pemex generated a cash flow (before tax and depreciation) that was 63% higher than the total cash flow of all the firms listed on the Mexican Stock Market. In 2012, the Ebitda (Earnings before Interest, Tax, Depreciation and Amortization) of Pemex was 88.2 billion dolalrs, compared to the combined 54.2 billion dolalrs of Ebitda for América Móvil, Banorte, Femsa, Walmart de México, Grupo Modelo, Cemex, Kof, Televisa, Peñoles and Alfa.

How important is Pemex in the worldwide picture?

According to Petroleum Intelligence Weekly, U.S. Energy Information Administration and U.S. Crude Oil Imports by Country, Pemex is one of the world’s five most important crude oil producers, after Aramco (Sauid Arabia), NIOC (Iran), CNPC (China) and KPC (Kuwait).

Pemex is the third largest oil exporter to the USA, after Canada and Saudi Arabia, but ahead of Venezuela and Nigeria.

Pemex installations in Mexico. (Adapted from Fig 15.5 of Geo-Mexico). All rights reserved.

Pemex installations in Mexico. (Adapted from Fig 15.5 of Geo-Mexico). All rights reserved.

Mexico has the world’s 13th largest crude oil reserves and Pemex has the world’s 15th highest oil company revenues.

Mexico’s proposed energy reforms, which will allow private sector firms more access to some parts of the oil and gas sector, will only serve to boost the competitiveness of Mexico’s oil industry. The major problems facing Pemex are not directly related to revenues or to competitiveness, but are the persistence of corruption and a lack of transparency.

Related posts:

 

Nov 302013
 

In response to severe labor needs during the second world war, the governments of Mexico and the USA initiated the Bracero guest worker program in 1942. The program enabled Mexico to contribute to the war effort by sending temporary agricultural workers to the USA. Mexicans were granted renewable six month visas to work on selected farms. Most migrants under the Bracero program came from the same three states, Michoacán, Jalisco and Guanajuato. They worked mostly in California and other states along the Mexican border.

Los BracerosAs a result of the Bracero program, some farmers in the USA became very dependent on relatively cheap Mexican labor. The program was considered a great success by farmers. Unfortunately mistreatment of Bracero laborers was widespread. In protest, the Mexican Government threatened to stop the flow of migrants. During the war many Mexicans who were not recruited under the Bracero program entered the USA illegally looking for work. Tolerance for unauthorized migration developed on both sides of the border. With a large dependency in the USA on Mexican farm workers and a large supply in Mexico, there was virtually no way to put a halt to this migration stream.

Labor unions, churches and Latino groups in the USA opposed the Bracero program on the grounds that it held down farm wages and impeded the upward mobility of US Hispanics. They convinced the US Congress to halt the Bracero program in 1964. Between 1942 and 1964 an estimated 4.5 million Mexican Bracero workers entered the USA. At its height in the late 1950s more than 500,000 workers migrated each year. Most were temporary migrants who returned to Mexico within a year, often settling in larger cities, exacerbating the flow of migrants from rural areas to the growing cities. The Bracero program set the stage for the continued high volume of Mexican labor migration to the USA.

In an effort to ensure that the Bracero workers were only temporary migrants to the USA, the US government withheld 10% of all their earnings. The US government then remitted this amount to the Mexican government for payment to the workers on their return home. More than 70 years after the Bracero program started, many braceros are still trying to claim money that they earned legitimately years ago and that is still owed to them by the Mexican government.

The struggles of temporary bracero workers who were never repaid the 10% that had been withheld, are detailed in a short October 2013 article entitled “Bracero Guestworkers, Unpaid”, written by Adam Goodman and Verónica Zapata Rivera (history doctorate students at, respectively, the University of Pennsylvania and Mexico’s National Autonomous University).

The article also describes some of the other injustices faced by Bracero workers, including forced whole-body fumigation with DDT as they crossed the US border.

For more information about the Bracero program, see The Bracero Archive

Related posts:

Nov 272013
 

Happy Thanksgiving to all our American readers!

Try the following links to learn more about Mexico’s contributions to Thanksgiving. For starters, what about the idea that Thanksgiving originated in Mexico, not in the USA!

That idea may be slightly controversial, but most celebrations of Thanksgiving have close ties to Mexico since they include one or more of the following ingredients:

Of course, these items have come to play an  important role, not only on Thanksgiving, but in many of the world’s cuisines.

¡Buen provecho!

Happy Thanksgiving!

 Posted by at 3:52 am  Tagged with:
Nov 252013
 

This index page has links to our most important posts about Mexico City. Previous index pages include Mexican migrants and remittances: an introduction (Nov 2011), Maps of Mexico on geo-mexico.com (last update: August 2013), andThe geography of Mexico’s drug trade (last update: Jul 2013).

Mexico City background / physical geography / ground water

Sewers / Drainage

Aztecs – Food supply

History / hazards

Housing / Urban morphology

Megalopolis?

Mexico City air quality in 1980 (Photo: Tony Burton)

Mexico City air quality in 1980 (Photo: Tony Burton)

Traffic, taxis and air pollution

Metro/subway system

Sustainable Transport / Cable Cars

Urban revitalization

Other

Map of Mexico City urban system:

Map of Mexico City urban system

Map of Mexico City urban system. Click to enlarge. (Geo-Mexico Fig 23.1; all rights reserved).

Spatial growth of Mexico City Metropolitan Area:

Mexico City Metropolitan Area (Geo-Mexico Fig 22.2; all rights reserved)

Spatial growth of Mexico City Metropolitan Area (Geo-Mexico Fig 22.2; all rights reserved)

Locations in Valley of Mexico with high incidence of ground cracks:

Mexico City cracks map

Locations in Valley of Mexico with high incidence of ground cracks. Cartography: Tony Burton; all rights reserved.

General posts about Mexico’s urban geography

 

Nov 232013
 

Using recent World Bank data, the Pew Research Center conducted an in-depth analysis of remittances sent from the USA to Latin American countries.

Remittances to Mexico peaked at over $30 billion in 2006, but as a result of the Great Recession, have declined by roughly 29% to an estimated $22 billion in 2013. (The analysis is based on constant 2013 US dollars).

Figure 1 of Pew Report

Figure 1 of Pew Report. Shaded area is period of recession.

On the other hand, remittances to all other Latin American countries reached almost $31 billion in 2008, declined slightly but were up to almost $32 billion in 2013 (see graph).

Note that the data are for remittances sent through formal channels such as banks and formal money transfer businesses. The average cost of sending these formal remittances is significant, an estimated 7.3% in late 2013. If all informal remittances were included, the remittances to Mexico would be an estimated 50% higher, or over $30 billion.

The study focuses particular attention on Mexico because it receives more than 40% of all remittances from the USA to Latin America. Mexico ranks 4th worldwide in total remittances, behind India ($71 billion), China ($60 billion) and the Philippines ($26 billion). These three other countries get remittances from many countries throughout the developed world while 98% of Mexico’s remittances come from the USA. The remaining 2% come mostly from Spain and Canada. No other country in Latin America receives more than 90% of their remittances from the USA. Spain is a bigger source of remittances than the USA for Argentina, Bolivia, Paraguay and Uruguay. This is a bit surprising given the horrible current economic situation in Spain. Many Spaniards are now migrating to Mexico in search of work.

The USA is by far the largest source of all worldwide remittances with $123 billion, followed by Saudi Arabia $28 billion and Canada $24 billion. However, on a per capita basis or percentage of GDP basis, Saudi Arabia, Canada and many other countries send significantly more in remittances than the USA.

The main reason why remittances to Mexico declined after 2006 is that the Great Recession very seriously hurt the construction industry, a main source of jobs for Mexican immigrants. Related to this, the overall loss of jobs in the USA meant that many immigrants returned to Mexico. In recent years it appears that more have returned to Mexico than have migrated to the USA. Thus the number of Mexican-born residents in the USA is declining very slightly for the first time since the Great Depression in the 1930s.

While remittances are extremely important to specific Mexican households, particularly rural households in western Mexico, remittances are not as important to the overall Mexican economy as they are to some other countries. Remittances account for about 2% of the overall Mexican GDP compared to 17% in El Salvador, 16% in Honduras and 10% in both Guatemala and Nicaragua.

The average amount of remittances sent by Mexican immigrants is rather low compared to immigrants from other countries. On average immigrants from Mexico over age 18 sent $2,115 in remittances per year, compared to $5,558 for immigrants from Guatemala, $5,231 for Honduras, $3,076 for Dominican Republic and $2,939 for El Salvador. We do not know if immigrants from these other countries had higher paying jobs than those from Mexico.

Source:

D’Vera Cohn, Ana Gonzalez-Barrera and Danielle Cuddington, “Remittances to Latin America Recover – but Not to Mexico”, Pew Research Center, November 15, 2013.

For more detail about remittances in Mexico, see: