President of the Jamaica Money Remitters Association Jacinth Hall Tracey, who is also CEO of Lasco Financial Services Limited, which offers remittance services through Moneygram, says that the aggressive spend by remitters in sending money to Jamaica in 2020 is not likely to be duplicated.

However, Jamaica Observer research shows that remittances have risen by double digits for most of the months since the start of 2021.

Overall, for the January to December 2020 period, remittance inflows into Jamaica totalled US$2.9 billion, according to data from the Bank of Jamaica (BOJ). For the nine months to September 30, 2021, overall totalled US$2.6 billion, an increase of 24.4 per cent year over year.

On November 4, 2021 the BOJ said net remittance inflows of US$282.8 million in the month of September increased by 16.8 per cent or US$40.7 million in comparison to September of 2020. A previous report had stated a decline.

In comparison with other countries, for the January to September 2021 period, remittance inflows to Jamaica of 24.4 per cent were lower than that of Guatemala, which registered a growth rate of 36.6 per cent. Similarly, El Salvador registered growth of 31.0 per cent for the period.

However, for Jamaica, if a 24 per cent growth rate is applied to the full year, the outturn could fall in the region of US$3.5 billion. Monthly inflows so far since January are averaging $290 million. If that continues through December, gross inflows for the year also indicate an amount in excess of the US$3-billion mark.

Noting that average spend remains US$200 monthly per sender, Hall Tracey told the Jamaica Observer, “I think the increase is in relation to the experience of the diaspora. A lot has to do with stimulus cheques they received and employment benefits. We do not expect the same level of aggressive growth as last year. There were stimulus cheques earlier this year, too.”

Regarding making a projection for year-end, she stated the situation that this would “require data analysis”.

In the island’s major source market for remittances, the United States, employment rates have been increasing. America’s jobs recovery gathered some steam in October with US employers adding 531,000 positions. Meanwhile, the unemployment rate fell to 4.6 per cent, the lowest level since the economic recovery started in May 2020.

However, inflationary pressures have also been affecting that market. In the week of November 8, data released by the US Labor Department indicated that consumer prices rose by 6.2 per cent compared to the same period last year, the biggest one-year jump seen since 1990.

Another caveat which affects the possibility of remittances to Jamaica outperforming 2020 is that funding might be diverted to the customary Christmas barrel which is a tradition among some migrants who send food and clothing and gifts to relatives around the festive season.

In 2020, the largest source market was the USA. Remittances from the USA accounted for 67.1 per cent. Other notable source countries were the UK at 12.7 per cent, followed by Canada and the Cayman Islands at 10.1 per cent and 6.0 per cent.

For calendar year 2020 Jamaica’s growth rate in remittance inflows of 20.8 per cent is a regional high. Mexico registered a growth rate of 12.7. Guatemala and El Salvador also registered growth for the period, with increases of roughly 7.5 per cent and 4.8 per cent, respectively.

Earlier in 2021, the World Bank commented that despite COVID-19, remittance flows remained resilient in 2020, registering a smaller decline than previously projected.

The World Bank said that, with global growth expected to rebound further in 2021 and 2022, remittance flows to low- and middle-income countries are expected to increase by 2.6 per cent to $553 billion in 2021 and by 2.2 per cent to $565 billion in 2022.