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Transnational Engagement, Remittances, and Their Relationship to Development in Latin America and the Caribbean
In 2004, the Latino diaspora living in the United States sent some $45 billion to their relatives back home, an amount equal to all foreign direct investment flows to Latin America (and far exceeding official development assistance). Broadening his pioneering work on remittances, Orozco, of the Inter-American Dialogue, finds that the enduring ties between immigrants and their homelands are promoting inter-American integration and innumerable business opportunities through "5Ts": family remittance transfers, tourism, transportation (air travel), telecommunication (telephone calls), and "nostalgic trade." Among the many fascinating facts uncovered by new surveys of immigrants from 14 countries and recipient families living in eight countries are the following: every year, each Latino immigrant remits on average $2,500, thereby doubling the disposable incomes of many poor families; purchases of "nostalgic goods" from home, such as tamales, bread, and cheese, account for up to ten percent of El Salvador's exports; and many recipients wisely set aside some cash to pay for education and invest in their homes (although most remittances are immediately spent, as is evidenced by the mushrooming of consumer malls in Central American cities). Orozco points to a number of promising opportunities for policy interventions, including targeting immigrants as tourists, business partners, and philanthropists.