The COVID-19 pandemic precipitated a global economic downturn and worldwide halt on mobility. The economic shock and resulting jobs dislocation have hit migrants hard in many places. The story line is less clear, though, with regards to how the pandemic is affecting the essential flow of money that many migrants send back to their families and communities.

Early on, there were predictions that remittances would collapse by one-fifth, amounting to the sharpest drop in recent history and the dissolution of a financial lifeline for low- and middle-income countries.

And in some places the prediction has been borne out: Remittances to the Philippines fell by nearly 20 percent in May, while Tajikistan has seen a 15 percent decline so far this year. Overall, remittances to the Asia-Pacific region, whose migrants make up one-third of global workers, are expected to fall by up to $54.3 billion, or roughly 20 percent of 2018 levels, according to the Asian Development Bank. Globally, the bank predicts remittances could plunge by as much as $108.6 billion this year.

But not everywhere. In several countries, remittances have actually increased for several months this year. “It’s the exact opposite of what we were expecting,” Jonathan Heath, deputy governor of Mexico’s central bank, told The Washington Post. In his country, remittances during the first half of the year were up 10 percent over 2019.

Remittances are similarly comparable to or up over previous years in Guatemala, the Dominican Republic, and elsewhere in Latin America. In Bangladesh, remittances have increased since May, up to a record $2.6 billion in July. Remittances to Pakistan in June were 51 percent higher than the previous year.

These cases are not the norm, and there is reason to think they may not be permanent. Indeed, in some cases migrants may be wiring back their last savings as they return to their countries of origin. The increases may also be explained by pandemic-relief policies in migrant-destination countries, including stimulus payments in the United States and increased unemployment compensation, or migrant workers who find out that their jobs in agriculture and food service industries are essential after all. Or it may be simple quirks of exchange rates, as seemed to be the case with Mexico earlier in the spring.

But the fact that money transfers are increasing in some places suggests that the relationship between the global economy and remittances is more complex than seems at first blush. While it has been established that remittances often increase during natural disasters, epidemics, and other crises in migrant-origin countries, the truly global nature of the COVID-19 pandemic offers a new kind of test case. It will be months—and perhaps years—before the full scope of the changes is understood. But it is clear, like so much else with the pandemic, that the results continue to surprise.

Best regards,

Julian Hattem

Editor, Migration Information Source