Q24N (Translating Cuba) EFE/14ymedio – Nicaragua received a new record US$4.66 billion in family remittances in 2023 – representing 29.7% of its gross domestic product (GDP) – of which US$3.84 billion came from the United States, the Nicaraguan Central Bank reported.
Nicaraguans received $1.43 billion more than they did in 2022 when they received US$3.22 billion in remittances, representing 23% of GDP and 44.5% more, the state-owned bank said in a report.
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The main sources of remittances in 2023 were from the United States with 82.4% (US$3.84 billion), followed by Costa Rica with 7.1% (US$331.9 million), and Spain with 5.9% (US$276.6 million), the Central Bank highlighted. Remittances from these three countries together accounted for 95.4% of the total.
According to official data, remittances from the United States totaled 55.5% more over the previous year, coinciding with a large number of Nicaraguans leaving their country for the United States in the past year.
From Costa Rica, remittances were up 20.3% over 2022, and from Spain, the year-on-year increase was 2.4%.
Nicaragua increased its economic growth projection to a maximum of 5% in 2023 and 4.5% in 2024, “based on the behavior of a set of variables (exports, tax collection, credit, remittances, tourism, among others), as well as the positive evolution of the country’s main trading partners”, according to the Central Bank, which does not yet provide this indicator.
The International Monetary Fund (IMF) forecasted a 4 percent growth of Nicaragua’s economy in 2023, driven by record remittances, and 3.5 percent growth rate in 2024.
The IMF expected family remittances to reach about 28% of Nicaragua’s GDP by the end of 2023, double their level at the end of 2021, driven by the rapid increase in Nicaraguan emigrants.
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Cuba, although it has a similar percentage of exiles, only received US$1.97 billion last year, the same amount as in 2010
About 20% of the total Nicaraguan population, estimated at 6.7 million, live abroad, mainly in the United States and Costa Rica, and it is estimated that half of them do so undocumented.
The data on remittances to Nicaragua contrasts with those of Cuba, which although it has a similar percentage of exiles, saw a decrease of 3.31% compared to the amount in 2022 and no significant increase in more than a decade.
According to a report by the Havana Consulting Group, the collapse shows that many exiles prefer to invest money in getting their relatives off the island rather than sending them foreign currency.
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“It is a strong warning sign that the country is losing one of its main lines of income,” said the consulting group.
Currently, money transfers to Cuba through various agencies are at a standstill following an alleged Fincimex cybersecurity incident, an attack on the company’s servers, which is being spun in the news as “a technical issue”.
Last week, Western Union confirmed that it had temporarily suspended remittances from the United States to Cuba more than a week ago. The administration of Cuban president Miguel Diaz-Canel reported a cyberattack on January 31. Officials have not discussed a link between the reported cyberattack and remittance processing.
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