Taken from Diario Libre
Last August, the national economy received US$872 million in foreign currency for that reason
The Central Bank of the Dominican Republic (BCRD) reported that in August 2021 remittances received reached US$872 million, exceeding by US$102.2 million those registered in the same month of the previous year.
The institution noted that, when compared to August 2019, the year before the pandemic, remittances in August 2021 showed a growth of 38.8%, US$243.6 million more.
Cumulatively, between January and August of this year, remittances reached US$7,031.5 million, US$1,959.1 million higher than the same period in 2020, registering a 38.6% year-on-year growth.
The bank explained that the continued improvement in the economic conditions of the United States (USA) is one of the main factors that continues to influence the behavior of remittances, since 84.5% of the flows in July came from that country, where more than two million people of Dominican origin reside, according to the nation's Census Bureau.
Specifically, the report shows a recovery in employment in the United States, particularly following the creation of 235,000 new jobs, resulting in an unemployment rate of 5.2%, a decrease of 0.2% from 5.4% in July. Notably, unemployment among Hispanics in the U.S. fell to 6.4% in August from 6.6% the previous month.
The institution indicated that, in addition to the U.S., remittances from Spain stood out in August at 7.1%, the European country with the largest Dominican migrant population. Haiti and Italy followed with 1.0% and 0.9%, respectively. The remaining remittances were distributed among countries such as Switzerland, Canada, and Panama, among others.
Regarding the distribution of remittances received by province, the Central Bank of the Dominican Republic (BCRD) reports that the National District received the largest share, 33.8%, followed by the provinces of Santiago and Santo Domingo, with 14.4% and 8.4%, respectively. This indicates that more than half (56.6%) of remittances are received in metropolitan areas of the country.
Remittance flows are also relevant to financial inclusion. While remittance companies received 81.1% of remittance flows in August 2021, financial intermediaries channeled 18.9% of remittances received through formal channels, exceeding the 16.5% observed in the same month of 2020. This suggests greater access by economic agents to banking services.
This increased inflow of foreign currency has allowed for the accumulation of international reserves, which exceeded US$13 billion at the end of August, representing 14.3% of GDP and equivalent to 7.5 months of imports. These figures surpass the levels recommended by the IMF, contributing to the Dominican Republic's favorable external position and the prospect of a smaller current account deficit in 2021, of around 1.5% of GDP.
