Remittances: a poverty trap?

This is an interesting article on how emigration affects development. Remittances of money from immigrants in the rich world to their countries of origin have decreased in the past year or so due to the global economic crisis. Basically there aren't as many jobs in the US or Europe, so immigrants there are able to send less money back to places like Mexico or Morocco. Latin America is particularly hard-hit by this trend; indeed, some countries like El Salvador or Guyana depend on remittances for a large part of their Gross Domestic Product.

Anyway, what I find interesting about the article is the idea of emigration as a poverty trap. If a country is poor and underdeveloped, some citizens will go to other countries to work. This decreases official domestic unemployment numbers, and creates an infusion of income in the form of remittances, so national leaders are less likely to feel pressure to lead real economic development processes within the country. Without a real national development, the country stagnates more, and more people emigrate. The examples of Mexico, Morocco, and Algeria go to support the common-sense argument that a country cannot build a real, lasting prosperity based on emigration. All three countries have a decades-long history of mass emigration, and all three remain poor, backwards, and unequal.

Lastly, the article reminds us that remittances are private wealth; they belong to the sender and the family that receives them. This is yet another reason why it is a mistake for governments to focus on ways to leverage this remittance wealth for national development, as if it were money that the government could dispose of as it sees fit.