The Central Bank of the Dominican Republic (BCRD) reports that during the first seven months of 2023, remittances received reached US$5,909.3 million, representing a 4.2% growth compared to the same period of the previous year.
This increase is in line with the projection of exceeding US$10 billion by the end of 2023.
In particular, July saw remittances of US$889.4 million, an increase of 5.1 % compared to June 2023 and an increase of 10.0 % compared to July 2022.
These flows mark the seventh consecutive month of increase during the year, extending the behavior observed since the last quarter of 2022.
The BCRD explains that the economic performance of the United States was one of the main factors that influenced the behavior of remittances, since 82.6 % of the formal flows in July came from that country, which is equivalent to some 654.8 million pesos.
On the one hand, the general unemployment rate in the United States went from 3.6 % in June to 3.5 % in July. In addition, the non-manufacturing Purchasing Managers’ Index (PMI) of the Institute for Supply Management (ISM) registered a value of 52.7 in July, indicating a sustained expansion of the services sector, where most of the Dominican diaspora is employed.
FAMILY REMITTANCES RECEIVED (MILLIONS OF US$)
MONTH 2022 2023 ABSOLUTE VARIATION RELATIVE VARIATION
January 759.3 802.0 42.7 5.6 % February 759.3 802.0 42.7 5.6
February 748.8 764.3 15.5 2.1 % February 748.8 764.3 15.5 2.1
March 888.1 915.1 27.0 3.0 3.0 % March 888.1 915.1 915.1 27.0 3.0 % April
April 809.8 811.0 1.2 0.1 % April 809.8 811.0 1.2 0.1 % May
May 851.2 881.1 30.0 3.5 % May 851.2 881.1 30.0 3.5 % June
June 803.8 846.4 42.6 5.3 % July 808.6 889.6 889.4 42.6 5.3
July 808.6 889.4 80.8 10.0 % July 808.6 889.4 80.8 10.0 % Total
TOTAL 5,669.7 5,909.3 239.6 4.2 % REMITTANCES FROM OTHER MARKETS
Remittances from other markets
The BCRD also highlights the receipt of remittances through formal channels from other countries in July, such as Spain, with a value of US$53.9 million, which represents 6.8% of the total.
Spain is the country with the second largest number of Dominican diaspora residents abroad, followed by Haiti and Italy, which represent 0.9% of the flows received each. The rest of the remittances are divided among countries such as Switzerland, Canada and Panama, among others.
Regarding the distribution of remittances received by provinces, the BCRD indicates that the National District received 36.0% in July, followed by the provinces of Santiago and Santo Domingo, with 13.4% and 8.8%, respectively.
This indicates that more than half (58.2%) of remittances are received in the metropolitan areas of the country.
After analyzing the recent evolution of the external sector, the BCRD’s outlook foresees significant flows of remittances, exports, tourism revenues, and foreign direct investment during 2023.
These foreign exchange inflows will continue to influence the relative stability of the current exchange rate, so that at the end of July, the national currency appreciated by 0.02% compared to the end of 2022.
The institution highlights that higher external income flows have allowed maintaining an optimal level of international reserves, which at the close of July exceeded 15.4 billion dollars. This level represents 12.6% of GDP and approximately 5.7 months of imports, above the thresholds recommended by international organizations.