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Post El Salvador: International Remittances (Richard Hancock, US)
Created by John Eipper on 11/02/06 6:08 PM - el-salvador-international-remittances-richard-hancock-us

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El Salvador: International Remittances (Richard Hancock, US) (John Eipper, USA, 11/02/06 6:08 pm)

Richard Hancock writes:
A 1 November 2006 article in the *Wall Street Journal*, "Migrants Money
Is Imperfect Cure" by Bob Davis, with a contribution from John Lyons in
Mexico, inspired the following thoughts about El Salvador:

El Salvador: 1962 and Now

El Salvador, with an area of 8,124 square miles, is slightly smaller than
our state of Vermont, although it seems much bigger because its terrain is
extremely mountainous. As of 2005, its population was 6,704,932, 59.6% of
which is urban; Its capital, San Salvador, has a population of 1,424,000. In ethnicity, it is 90% Mestizo, 9% White and 1% Amerindian. With 825
people per square mile it is the most densely populated country in the
Western Hemisphere.

When the Peace Corps (PC) arrived in El Salvador in 1962, the total
population was only 2,475,650, and San Salvador had only 232,659
inhabitants. The country was much more rural in character and the
ethnicity described above was approximately the same. The currency was the
Colon, valued at 40% of the dollar; now their currency is the dollar
(adopted in 2001). Because of insecurity, the PC was suspended in 1979 and
didn t return again until 1993.

As I look back at El Salvador in 1962-63, I realize that there were some
signs of an impending tempest. The upper class (14 families according to
a then-current *Time* article) was supremely indifferent to the plight of
the rural peasants. The women of this class could talk knowledgeably
about New York, London and Paris but did not know where the major rural
towns in El Salvador were located. On one of the occasions when the
Ambassador joined me on a visit to the countryside, I asked him why male
leaders of the 14 families did not speak out on current issues; they were
educated in the world s best schools and their opinions on these matters
would certainly have mattered. The Ambassador replied, If one of these
men were to speak on these issues today, his peers at the Club Salvadore o
would not speak to him tomorrow. They firmly believed in the unwritten Latin American code of Mind your own business. This of course left the
chore of speaking out to people who had nothing to lose and thus were free
to demagogue to their heart s content.

There were few Salvadorans in the US in 1962, whereas now there are
many--1.5 million according to the Wall Street Journal of November 1,
2006. This article points out that by far the main source of foreign
exchange for El Salvador is remittances from Salvadorans living abroad. At
nearly 3 billion dollars annually, these remittances comprise 16% of El
Salvador s gross domestic product. The article points out that this is
not unique in the world since Tonga (31.1%), Moldova (27.1), Lesotho
(25.8), Haiti (24.8), Bosnia and Herzegovina (22.5), Jordan (20.4) and
Jamaica (17.4) are all more dependent on these remittances than is El

The article states that, because of remittances, the town of Ciudad
Barrios in far eastern El Salvador has become in effect a ward of the US. Forty thousand families in the region receive average monthly remittances
of $157 per household, enough to feed a family of four and to lift a
family out of extreme poverty. Although the remittances alleviate poverty
on a temporary basis, they have not proved to be the engine of development
that some had optimistically hoped. They have rather served as an
incentive for more Ciudad Barrios residents to travel to the US. A great
part of the problem is insecurity; the US residents from Ciudad Barrios
don t wish to invest in their home region because of the fear of having
their money extorted by gangs. Dora Ruiz, who works in a restaurant in
Washington DC, says, simply, You will be robbed. One definite benefit
is that many more students graduate than before because of the help that
families receive from their relatives in the US.

Nancy and I visited San Salvador twice in the 1980s and once for a
Salvador I reunion in 1998. In 1962, El Salvador was so peaceful that the
US Ambassador Murat Williams and his lady used to join us in the PC Jeep
station wagon to visit PCVs in any part of the country with no problem of
security. On one occasion, the Ambassador of Great Britain and his lady
also joined us in these visitations. Now the US Embassy is a fortress.
During our 1980 visits, we frequently heard rifle shots and there were
guards with sawed-off shotguns at the entrances of banks, hotels and many
businesses. During our 1998 visit, the Embassy security briefed us,
suggesting that we certainly should stay in a group and never go into the
country alone. In 1998, San Salvador was a thriving city with all kinds
of international hotels and restaurants, but life in the countryside
appeared perhaps less viable than in 1962.
Despite all of this, I am still optimistic about El Salvador. They are
the workers of Central America and I believe that if we and they
perservere, this beautiful little country will someday realize at least
some of its dreams. This will only come to pass if we remain patient with
the undocumented Salvadorans in our country. The politicians that are
advocating the premptory return of these hard-working people have no idea
of what turmoil they would create in El Salvador if their demands for a
forced evacuation of all illegal aliens from the US were to be
JE comments: Thanks to Richard Hancock for this unique perspective: Then
and Now in El Salvador. Richard's appeal for patience towards the
undocumented Salvadorans living in the US is very welcome. Might other
WAISers voice their views on a very important aspect of the global
economy--international remittances from overseas workers?

For information about the World Association of International Studies
(WAIS), and its online publication, the World Affairs Report, read its
homepage by simply double-clicking on: http://wais.stanford.edu/

John Eipper, Editor-in-Chief, Adrian College, MI 49221 USA

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