CenAm Watch: Record Guatemala remittances, El Salvador cenbank app

Guatemala remittances set for record

Central bank president, Sergio Recinos, said he estimates that family remittances to the country will reach US$9bn in 2018, an all-time high amount and a 9.8% increase over 2017.

This year's strong growth follows the 14.4% expansion seen in 2017, as Guatemala, like the rest of Central America and Mexico, experienced a broad expansion of remittances in the last two years.

Remittances represent an important driver for the Guatemalan economy, especially in terms of the consumption power of the many low-income individuals who receive money from relatives working abroad.

Remittances in the first 11 months totaled US$8.44bn, equivalent to 74.1% of the annual budget approved by congress for the fiscal year of 2019.

According to the International Organization for Migration (IOM), remittances sent by immigrants represent 10% of Guatemala's GDP. Authorities estimate there are some 3mn Guatemalans working in the US, with some 800,000 being undocumented.

GDP growth is on track to hit 3% for 2018, ahead of the 2.8% recorded in 2017 but behind the 3.1% growth seen in 2016.

As reported by EFE, Recinos sees economic growth in the country tied to stronger public spending, higher family incomes from remittances, and rising trade activity.

For 2019, Recinos predicts GDP will grow 3.4% and he does not expect any major impact on the economy from the general elections to be held in June next year.

The projection falls within the range of various forecasts for the country, including that of the International Monetary Fund (3.3%) and the UN's Eclac unit (3.5%), and estimates from rating agencies Fitch (3.5%), Moody's (3.4%) and Standard and Poor's (3%).

El Salvador cenbank launches app

El Salvador's central bank (BCR) unveiled its first-ever mobile app on Wednesday.

Dubbed Punto Financiero SV, it will allow people to access contact information and locate ATMs and financial correspondents closest to them, using geolocation services.

"Through this application, which is available for cell phones and tablets that use the IOS and Android platforms, users can also know the cost of fees for withdrawing cash at ATMs and opening hours at service centers and financial correspondents," read a BCR release.

The app was developed with support of Mexico's central bank.

"As a central bank, we are aware that the use of new financial technologies is an important part of the development of the financial system and in this sense we want to contribute to the population perceiving the benefits of its use," said BCR president Óscar Cabrera.

The nation's various financial institutions will provide the information available on the app, which also features connectivity to major social networks.

Cabrera added that the bank is convinced the app will not only facilitate access to financial sector information and services, but "will also lead to a reduction in costs paid by the population."