Weekly Report - 23 March 2004

REMITTANCES | Nudging world leadership. Only India ranks above Mexico as a recipient of remittances by expatriates, according to a new World Bank method of calculating these flows that has raised totals way above previous IMF estimates. Working on figures for 2001, these calculations put Mexican remittances at US$9.9bn, only slightly below India's US$10bn. These two countries are in a league of their own; next down the scale is the Philippines, with US$6.4bn, and after that the totals fall below US$3.5bn. One other Latin American country made it into the top ten: the Dominican Republic, with US$2bn. [Note that, as we have been reporting, remittances to Latin America have continued to grow rapidly since these calculations were made.]

FINANCE | Banks not lending enough. Central bank governor Guillermo Ortiz has rebuked Mexican bankers for not lending enough to the private sector, despite having seen their volume of business increase thanks to the improved regulatory framework. He noted that of total financial savings, which amount to 53% of GDP, the banks are devoting only a third to lending to the private sector — the rest goes to cover the government's borrowing. Ortiz also weighed into the banks for the charges they make for their services, which he said were `quite a bit higher than in other countries.' Ortiz was speaking at the 67th convention of the Mexican banking association. President Vicente Fox also addressed the gathering, rubbing in the same message.

EMPLOYMENT | Jobless rate rises again. The official open unemployment rate in Mexico's 32 main cities reached 3.92% in February, up from 3.81 the previous month. In February 2003 it was 2.74. Given the restrictive definition of unemployment, these figures serve as a gross indicator of the trend, rather than the actual number of jobless.