Remittances contribute to the achievement of the SDGs

In 2020, Guatemala received 11.340 billion dollars [1] for family remittances from abroad, which represents 14.6% of the Gross Domestic Product (GDP), a similar number to the exports registered in the same period. But how do these numbers turn into a better quality of life and local development?

Remittances contribute to the coverage of basic needs such as food, shelter, transportation, communication, and housing, even in many cases they are essential to acquire the basic vital basket. Remittances are also used in aspects such as thepayment of tuition and the education of children and adolescents, injecting capital into new ventures, helping to save crops and are invested in the recovery after an environmental crisis or catastrophe, as happened with the eruption of the Fuego volcano, in June 2018.

The 2030 Agenda for Sustainable Development [2] was established by all the member states of the United Nations to achieve the 17 Sustainable Development Goals (SDG) and constitutes a universal call to action to end poverty, protect the planet and improve the lives and prospects of each person. Even though Guatemala lags behind in meeting these goals, society is becoming more involved every day and is committed to building a better future for everyone, maximizing the impact of migration on development.

Therefore, migrants perform a fundamental role in the fulfillment of the SDGs, especially in achieving a significant impact in the communities of origin. It is migrants who send remittances to repair schools and homes, build bridges, upgrade homes, maintain access to new communication technologies, make donations to achieve community organization and ensure that their families have access to essentials.

There has also been a record of donations of computer equipment for schools, and school supplies. About food security, they contribute to the purchase of seeds, nutrients, and acquisition of water. The families receiving the remittances share these shipments through food to share with neighboring families.

In the context of the COVID-19 pandemic, family remittances have served to save lives. Without them it would have been impossible to purchase medicines and hiring intensive care, but especially to sustain the household economy while the stay-at-home modality is adopted.

There is an aspect little studied, and it is the use of the remittance in the social and community organization. Many migrants have invested in cooperatives or charitable associations that serve the main needs of the towns, and they also invest in small-capital enterprises and businesses. [3]

Certainly, family remittances sent from abroad are helping with the achievement of some of the SDGs, especially those related to economic aspects such as the eradication of poverty and extreme poverty, zero hunger, health and well-being, quality education, water and sanitation, reducing inequality, sustainable cities and communities, responsible consumption and production, life and terrestrial ecosystems, and partnerships to achieve the goals.

There are 2 very important goals in migration matters that cover the role of diasporas and the sending of remittances:

Goal 10: Reduce inequality within and among countries.

Target 10.7. Facilitate orderly, safe, regular, and responsible migration and mobility of people, including through the implementation of planned and well-managed migration policies.

Target 10.c. By 2030, reduce to less than 3% the transaction costs of migrant remittances and eliminate remittance corridors with costs higher than 5%.

Mirtala Sierra, head of the Office on Youth, of the Municipality of San Cristóbal Verapaz, in the department of Alta Verapaz, Guatemala, points out that “family remittances have been a great support for families, especially for single heads of household that are benefited with resources sent from abroad by their partners or their older children.”

“This municipality was seriously affected by storms Eta and Iota in November 2020, in addition the COVID-19 pandemic has left families with debt and economic problems. However, the remittances transferred to the municipality have helped to overcome health issues, education of sons and daughters, purchase of food or support of small businesses,” added the municipal official.

Heydi Cruz, from the Municipal Office, Secretariat of the Food and Nutritional Security (SESAN), in San Cristóbal Verapaz, highlighted that at the local level “height and weight are monitored in children, adolescents and pregnant mothers to identify possible cases of malnutrition”. "Remittances represent a great contribution to families and constitute a complementary element for the diversification of food and nutrients that the most vulnerable populations need, especially in the rainy season and hurricanes when crops and vegetables for their own consumption are decreased."

Boosting the remittance

Remittances represent for Guatemala a relatively stable source of resources for development, however, there are social, economic, and political aspects that must be taken into account to channel them efficiently and sustainably in the future:

• Enabling economic environments [4]: countries should adopt sound macroeconomic policies that include transparent legal systems, stable interest rates, better market integration and reliable financial institutions, so that the remittance can be used to its full potential for developing.

• Do not depend on remittances: the most recent global history has shown us that external events, pandemics, economic mismanagement, and political instability severely affect the flow and volume of remittances sent to the countries of origin.

• Remittances are not a substitute for international cooperation: there is a dangerous perception that remittances could substitute for development cooperation, an aspect that could especially affect countries with low and medium economies such as Guatemala.

• Generation of data and information: it is essential to establish systems with reliable indicators that reveal not only aspects of the volume and percentage of remittances, but also include profiles of migrants, both recipients and those who send, geographic, age and gender elements; also encourage research and quantification in the achievement of the Sustainable Development Goals.

• Non-discrimination: the impact of remittances on societies is undeniable; however, xenophobia and discrimination against migrants make it impossible for them to be recognized as development actors. Each migrant person has the same rights as other people, regardless of their immigration status. An example of the expressions of discrimination is the limited information that exists in Mayan languages. Many remittance recipients are illiterate or only speak their mother tongue, making it impossible to have a comprehensive understanding of how to collect, use and take advantage of the remittance.

• Access to information for diasporas and their families in the countries of origin: Some financial entities charge up to 12% commission for sending remittances, while institutions in the countries of origin charge an additional percentage to the families that collect them. Digital remittance companies charge the least commission, between 4 or 5%, a still high percentage compared to target 10.C of Sustainable Development Goal 10. This type of information, as well as exchange rates, delivery times, collection boxes in the communities and in their own languages.

The World Migration Report 2020 [5] shows 272 million international migrants, which is equivalent to 3.5% of the world population. For Guatemala, the Foreign Ministry estimates some 2 million migrants living in the United States, including those in an irregular situation. Countries must take urgent measures to protect these people and generate better policies for a better use of the remittance for development.

[1] Guatemala: Foreign Currency Income from Family Remittances, 2020, Banco de Guatemala:

https://www.banguat.gob.gt/inc/ver.asp?id=/estaeco/remesas/remfam2010_2…

[2] 17 Goals for people and for the planet, United Nations:

https://www.un.org/sustainabledevelopment/es/development-agenda/

[3] Community of Esquipulteco Absent, Facebook:

https://www.facebook.com/comunidadesquipultecoausente

[4] Report “Migrants, remittances and development: myths, rhetoric and realities”, IOM, 2006:

https://www.iom.int/es/news/las-remesas-de-los-migrantes-y-el-desarrollo

[5]https://publications.iom.int/system/files/pdf/wmr_2020_es.pdf

Translated by: Jackeline Lemus

University intern - UMG