Remittances - a blessing in disguise
Editorial
Kaieteur News
March 23, 2007
Overseas-based Guyanese have remitted at least US$270 million during the past year, according to a report by the Inter American Development Bank. It is not only the Guyanese who are remitting money. Haitians, Jamaicans and some of the people from the Latin American countries have also remitted large sums.
But from our point of view the remittances have been a great cushion. The economy for years has been incapable of sustaining the nation in a manner that the people could have been happy. In the first instance, the wages and salaries are low when compared to most other countries.
The head of a school earns not much more than US$6,000 per year or $1.2 million. In the more developed country this is not even the minimum wage. The average worker works for much less but he is expected to maintain a family in keeping with the expected norms of the global society.
Some people undertake more than one job and therefore sacrifice some of the time they would spend with their family. This often leads to delinquent children and consequently, some of the criminal situations that exist today.
It is against this background that one must examine the remittances. The sum remitted for last year was more than half of the national Budget which was $100 billion. The remittances were in the vicinity of $54 billion and highlighted the extent to which the government has been supported in maintaining the people of this country.
People sent back money to help refurbish homes or build new ones but most of them merely supported the average household. They helped feed their less fortunate relatives back home and in the process outfitted many a schoolchild.
One could only imagine the state of affairs without the remittances. Many of the things that we take for granted—the fancy clothing, the often well-decorated homes, the neat and tidy schoolchildren—might not have been a reality.
And if one were to examine the issue of remittances more closely one would realise that the official figures may be less than the sum actually shipped back home. People have not only used the money transfer services, which actually provided the figures for the IDB. People have used couriers.
We know that people often prefer their relatives to get every dime and so find it hard to pay the commission to the money transfer services. So, they would ask others who are traveling to this part of the world to do them a favour and “drop off some money.”
More recently, the focus has been on the drug trade and what the experts call the parallel economy. They place the parallel economy at somewhere between 40 per cent and 60 per cent of the national economy. If these estimates are correct then the situation in this country is even worse than we would want to believe.
We have the latest in cars, fashionable homes, and an ever increasing number of nightspots because there are still people who have a disposable income. This is because the people do more than earn through traditional sources. Perhaps this is the reason why our drug addict population is not as large as it would be in a rich country.
The issue of money laundering therefore comes to the fore and this is one area that the government is preparing to legislate. It is common knowledge that there are major players in the drug industry in this country. Their earnings do not normally form part of the revenue to the public treasury because these earnings do not come from the usual sources such as exports.
It goes without saying that the money laundered has in some ways aided the economy. The money launderers have established large edifices that provided employment for many during the construction stages and later, when it was time for the occupants to recruit staff.
Given the state of the economy it is unlikely that money launderers would be vigorously pursued by those entrusted to report on the suspicious movement of money. For one, they are going to be conscious of the leaks in either their own organisation or in the organisation to which they report. Leaks could sometimes lead to fatalities in this corner of the world.
No country should tolerate criminal activity but the way things are it would be a case of turning the Nelson eye to certain situations. And in the area of legality we should be grateful for the sizeable remittances that come our way.