Downturn means less money for immigrants to send home
By Tyler Sipe
The Contra Costa Times (CA), November 4, 2008
http://www.insidebayarea.com/argus/ci_10898901
Sending funds back home is a longstanding tradition among immigrants living in the United States, including those in the Tri-City area.
However, faced with a domestic and global economic downturn, many immigrants have been forced to tighten their wallets and decrease the amount of remittances they send to friends and family in their native countries.
Fremont resident Carmen Garcia, 49, works full time as a house cleaner. Until recently, she depended on supplemental income earned at a second job at a local banquet hall where she assisted with wedding celebrations and parties.
Garcia said that last year she sent about $500 a month to her son Ramon Garcia, 25, who used it for rent, food and school in Tepic, Mexico. Now, she sends about $300 a month.
'There's been little business, little work for me, so less and less money for my son,' Garcia said.
The economic crisis in the United States has hit particularly hard in Mexico, a country in which remittances drive consumer spending and make up the second-largest source of foreign income after oil exports, according to the Bank of Mexico. In 2007, expatriates sent more than $24 billion home to friends and family in Mexico.
The Bank of Mexico says remittances have dropped to their lowest level in 13 years. falling from $1.76 billion in January 2007 to $1.65 billion in January of this year, according to a recent report in the Dallas Morning News.
A few days after that report was released, Leslie Corona thumbed through the pages of Latina Magazine at Ramirez Market in Fremont's Centerville district, where she is manager.
Foot traffic at the 4-year-old store, which sells Mexican specialty products, has slowed considerably, Corona said. The store also provides remittance services. Money transfers have declined about 35 percent from this time last year, she said.
'It hurts us a lot,' Corona said. 'Everywhere it's bad. Everybody's suffering.'
Some of her customers, she said, have lost jobs in the service industry, including jobs at car washes and in landscaping, construction and painting. Others have lost their homes in the subprime mortgage crisis and a few, with no prospects of work, have returned to Mexico, Corona said.
However, not all countries are seeing decreases in the flow of remittances.
In Pakistan, remittances grew by more than $117 million between 2007 and 2008, according to the State Bank of Pakistan and reported in the Pakistan newspaper The Nation.
Expatriates living in the United States accounted for about $151.45 million of the total remittances in July and August this year, according to the State Bank of Pakistan.
However, there is no new data taking into account the recent global implosion of the financial sector, which has affected the amount of money Fremont restaurant owner and Pakistani native C.H. Saleem sends to his siblings living in Lahore.
'I have to support my family here and support family back in Pakistan,' said Saleem, who co-owns the Indian and Pakistani cuisine Bismillah Restaurant in Centerville. 'They're (relatives in Pakistan) not getting enough stuff, enough food.'
Business at the restaurant has dropped 40 percent since the same time last year so he's had to cut two lunchtime employees, he said.
As a result, Saleem has reduced how much money he sends to family in Pakistan from about $500 a month to about $200 a month.
'It's been a struggle lately, and the pressures on me are high,' said Saleem, gazing at his empty restaurant at lunchtime.
'In the Philippines, it's really bad,' said Mitchie DeCastro, a customer relations assistant at the Philippine National Bank in Fremont. She was busy assisting a small line of customers waiting to transfer funds to relatives in the Philippines.
DeCastro estimates the PNB Union City branch office has seen a 20 percent decrease in remittance transfers since 2006.
'A lot of people rely on money from their relatives, and it will probably get worse for them.'
Despite the two-year slowdown of customers at the Union City PNB, remittances overall to the Philippines increased by more than 14 percent in the first five months of 2008, compared with the same time in 2007, according to the Embassy of the Republic of the Philippines.
However, the Philippine Overseas Employment Administration attributes the remittance increase to a 39.5 percent rise in the number of Filipinos employed globally.
Outside of the PNB, Danny Galang, 59, said he hasn't decreased the amount of money he sends to friends and family in the Philippines, which he estimates to be around $8,000 annually.
'I want to send less, but I can't,' said Galang, who works for the city of Hayward. 'We're kind of obligated to help out relatives and friends.
'My priorities are reset. There is less money coming in from work so I don't go to the movies now, but I still send (money) to the Philippines.'
