Remittances Watch: El Salvador, Honduras

El Salvador remittances still rising

Family remittances to El Salvador reached US$407mn in January, for 5.7% year-on-year growth, according to the nation's central bank (BCR).

The bank reported 1.8mn remittance operations directed towards El Salvador, 2.2% more than took place in January 2018.

The January result comes on the heels of a record-breaking 2018, when remittances for the full year reached US$5.47bn, up 8.4%, according to BCR data, also beating the central bank's initial projection of US$5.20bn in remittances.

Of the 113 source nations for El Salvador's remittances in January, the US contributed the vast majority with US$380mn (93.3%), followed by Canada with US$3.6mn (0.9%) and Italy with US$2mn (0.5%).

The average remittance was US$262, not including mobile phone top-ups or cash.

The BCR also reported that 24.9% of total remittances were transferred to a bank account, indicating a greater use of bank accounts than seen in two years ago, when the percentage was 22.4%.

The bank noted that the US unemployment rate last month sat at 4%, up 10 basis points from the previous month. The Hispanic unemployment rate rose to 4.9% in January from 4.4% in December 2018.

Honduras remittances increase at rapid pace

Family remittances sent to Honduras in January totaled US$402mn, 17.4% more than in the same month of 2018, according to central bank (BCH) data, reported by local daily La Prensa.

Remittances in 2018 amounted to more than US$4.9bn, or greater than 18% of annual GDP.

Although there is no exact data, the authorities estimate that more than 1mn Hondurans live in the US, which is why 79% of remittances come from the US. A further 8% comes from Spain, followed by Mexico, Panama and Costa Rica with smaller percentages.