Remittances to El Salvador leap nearly 10% in 2017

By
Monday, January 15, 2018

Remittances flowing to El Salvador increased 9.7% in 2017 to US$5.02bn, surging ahead of the expected decision by the US government to allow legal migratory status lapse for nearly 200,000 Salvadoran citizens currently residing in the US.

That decision became final on January 8, sparking widespread dismay among Salvadorans living and working in the US for some 16 years under Temporary Protection Status (TPS), given to them in 2001. Also facing disrupted lives were their families, communities and relations back home in El Salvador, as well as the broader Salvadoran economy, which relies heavily on remittances from US residents.

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Those immigrants with TPS will have until September 9, 2019, to seek another form of legal residence in the US, and the recent uproar in the US over TPS and the so called "Dreamer" program - DACA, has led to multiple legislative efforts in that country to provide longtime residents with a path to permanent residency.

According to a government statement, remittances to El Salvador in 2017 represented 15.8% of gross national income. The government noted that the surge in transfers was related to preemptive concerns of Salvadorans residing in the US, as well as the overall solid performance of the US economy and "the elevated participation by Hispanic groups in the creation of that economy."

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The average remittance was US$253 in 2017, with a total of 23.4mn transactions settled. Of these transactions, 4.3mn correspond to recharges to mobile phones in El Salvador on behalf of people residing abroad. According to the data from, the central bank, 23.9% of the remittance income was paid into savings accounts.

In December alone, El Salvador received US$503mn in remittances, up 6.3% year-on-year from the same month of 2016. The government statement said the rate, which is lower than the annual average, was the result of a significant increase in remittances in December 2016 following the election of Donald Trump as US president.

During 2017, remittances were received in El Salvador from 164 countries, with those from the US accounting for 97.2% of the total (US$4.69bn), Canada 0.9% (US$44.5mn) and the European Union 0.9% (US$43.9mn).

The announcement added that the total US unemployment rate in December was 4.1%, equal to that recorded the previous month, while the Hispanic rate was 4.9% with a slight increase of 0.1 percentage points compared to the month of November.

The statement noted other countries also obtained solid remittances in December, noting remittances to Guatemala reached US$8.192bn, and increase of 13.4%; Honduras, with US$4.066bn, grew at a rate of 13.3%.