Latest update April 29th, 2024 3:41 AM
Jan 26, 2019 Editorial
The partial government shutdown in the U.S by President Trump over the building of a wall along Mexico’s border has entered its fifth week. It is the longest such in the history of the United States. Not only are some Government services no longer being provided to its citizenry, but undeniably, it has reduced tourism and remittances to the Caribbean and Guyana.
Unlike the Caribbean Islands whose economies and people depend heavily on tourism, Guyana’s is not.
However, remittances to Guyana, especially from the New York, which is the home to about 380,000 Guyanese nationals have helped to keep many afloat. Remittances are used for paying school fees, extra lessons, burials, medical expenses and buying groceries, as well as paying rent, mortgage or loans.
The fact that Guyana receives an average of US$440 million annually in remittances has prompted the Bloomberg Magazine, one of the world’s most influential financial publications, to surmise that Guyanese immigrants are doing more financial good for Guyana’s economy than the country’s private sector.
Data from the World Bank shows that remittances to low and middle-income countries reached US$466 billion in 2017, an increase of 8.5 percent over $429 billion in 2016. The World Bank stated that global remittances, which include flows to high-income countries, grew seven percent to US$713 billion in 2017.
Latin America and the Caribbean accounted for nearly US$80 billion.
Should the US Government shutdown continues, it is safe to conclude that these countries will see a drop in remittance inflow.
A survey done in 2010 by the Oxford Economic Organization found that over the years, tourism has played a larger role in Caribbean economies than it did in any other region of the world.
According to the Caribbean Travel and Tourism Council, tourism from the United States alone accounts for more than 250,000 fulltime jobs or more than a quarter of the total employment in the Caribbean as well as over 50 percent of the region’s gross domestic product (GDP) in 2017. It is estimated that 65 percent of all visitors to the Caribbean are from the United States, thus contributing US$12 billion to the region’s GDP.
The Jamaica Tourist Board (JTB) shows a record 4.3 million tourists visited Jamaica in 2017, contributing US$3 billion to Jamaica’s GDP. This arrival figure represents a 12.1 percent increase over arrivals in 2016.
However, we are all familiar with the saying if the United States economy sneezes the economies of the region will catch a cold, which is just another way of saying that, whether we like it or not, we are in the same boat.
This is due largely in part to globalization, which has made the peoples and the economies of the world more interconnected now than at any other time in the history of mankind. Events and decisions happening in the major capitals of the world have a direct as well as an indirect impact for peoples far removed in the developing countries such as those in the Caribbean and elsewhere.
Undoubtedly, if U.S workers do not receive a pay cheque due to the government shutdown, obviously they are not going to travel, which has so far reduced tourism in the Caribbean by six percent.
Of the estimated 800,000 workers who are affected by the U.S government shutdown, almost 15,000 are Guyanese, which means that Guyanese at home could find themselves without financial support, especially if remittances were their only source of income.
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