Mexico’s remittances surged 27% in 2021 to a record $51.6 billion

MEXICO CITY —  Mexico’s central bank says remittances — the money migrants send home to their relatives — grew by 27.1% in 2021 to total about $51.6 billion for the year.

That is a record, set despite the COVID-19 pandemic, and would surpass almost all other sources of Mexico’s foreign income, including tourism, oil exports and most manufacturing exports.

The bank said Tuesday the phenomenon doesn’t appear to be tailing off; remittances in December grew to $4.76 billion, 30.4% more than in the same month of 2020.

Remittances as a percentage of Mexico’s gross domestic product have almost doubled over the past decade, growing from 2% of GDP in 2010 to 3.8% in 2020, according to the government. Between 2010 and 2020, the percentage of households in Mexico receiving remittances grew from 3.6% to 5.1%.

Mexico is now the third-largest receiver of remittances in the world, behind only India and China, and Mexico now accounts for about 6.1% of world remittances, according to a government report.

On one hand, the spike may be simply a matter of need, caused in part by the pandemic. Mexico’s GDP shrank 8.5% in 2020, and, while the economy rebounded to post 5% growth in 2021, the last two quarters of the year showed a slight contraction, leading the country into a technical recession.

That may have led migrants to send more money to their families at home.

“When a Mexican family suffers illness or their household suffers damage, they receive more. … Why? Because, basically, they ask for help,” said Agustín Escobar, a professor at Mexico’s Center for Research and Higher Education in Social Anthropology.

Part of that growth also may have been fueled by strong labor markets and job opportunities for migrants in the United States.