The international financial crisis, migration and remittances in Latin America

Abstract

Under the current neoliberal model, immigration has increased in lockstep with the disarticulation of the internal market, the public-sector economy and the welfare state. While many have argued that migration had a role to play as an “escape valve”, a fundamental premise was omitted: the increase in immigration was proportional to the deep social and economic crises in the region that arose from neoliberal inspired structural changes. With the current financial-economic crisis, this model has shown its consequences. Even though its perceived effect on recipients of remittances has been complex, the economic situation has made many immigrants reconsider if they are willing to muddle through difficult situations or whether it is better to return home. What is clear is that the degree to which remittances fall will be determined by the duration and depth of the financial crisis and by the capability of immigrant workers, the sectors in which they work and the economies of their host countries to brave the storm. In the midst of the crisis, the need to take urgent measures to mitigate its harshest effects on migrant families has opened an intense debate as to which policy route to take.