Haitian Remittance Estimates for 2006

Sources: Inter-American Development Bank, Remittances to Haiti Topped $1.65 Billion in 2006; World Bank, Understanding the Remittance Economy in Haiti.

According to the Inter-American Development Bank’s Multilateral Investment Fund (MIF), the approximately 1.5 millions Haitians living abroad sent more than $1.65 billion back to Haiti in 2006. These remittances, or the transfer of money from one country to another, constitute more than one-third of the country’s gross national product. Haitians living in the United States were the largest source of the remittances, accounting for $1.7 million, while Haitians living in other countries such as Canada, France, and the Dominican Republic also contributed to the total quantity of remittances.

The MIF estimates believe that “about 1.1 million adults in Haiti receive remittances, typically 10 times a year, at an average of $150 at a time.” The money most frequently is sent to low-income families that use it to cover basic expenses. There is, however, some evidence that families are increasingly able to save the money for investments in education and small businesses. In 2006, the World Bank commissioned a paper titled Understanding the Remittance Economy in Haiti. That study indicated that the majority of the people who sent remittances back to Haiti were young females with college degrees or some level of college education.

For an excellent explanation of the basics of remittance transfers see UICIFD Briefing No.3: Remittances.

Question:

(1) Remittances obviously have a financial impact in Haiti. What are some of the impacts that remittances can have in a country outside of the financial realm? For example, what role, if any, do remittances play in social identity within a receiving country?

(2) What are some of the risks that a country runs if it depends too much on remittances?