Monday, August 26, 2002

I found this article on American foreign aid and private charitable aid very cheering. Carol Adelman points out that American governmental foreign aid is only a fraction of private aid, not even counting direct remittances from immigrants living in US to their families back home. I prefer to be able to choose how and where to give my charitable dollar, so I approve of this state of things.

Although the article states that "our government gave more foreign aid, in absolute terms, than any other country in 2001, topping second-ranked Japan" (in absolute terms means counting private charitable donations as well as government foreign aid), I wish the article had done a better job of including numbers from outside US. E.g if Japan is second-ranked, I'd like to know how much of its foreign aid is private and how much is public.

The personal remittances part is really interesting. A government report says that "Remittances increased from $8.4 billion in 1990 to $11.8 billion in 1995. More than 60 percent of remittances went to the countries of Central America, the Caribbean, and South America". More probably goes through uncounted, brought directly across the Rio Grande inside peoples' wallets. Remittances are finally being seen as a development tool. "In 2000, over $20 billion was sent overseas from immigrants in the US in 80 million separate transactions... the remittances sent to Haiti, Ecuador, the Dominican Republic, El Salvador and Jamaica account for 10 percent of the GDPs of each of those countries." Holy cow.

Many governments (Kenya, Cuba) restrict personal remittances from residents (Cuba limits to $300 per quarter). Other countries tax remittances (Brazil) even though they may already have taxed the money once as income. The US remittance limit seems to be $10,000 without requiring any paperwork, and more if you do the paperwork to prove you're not laundering money. I do not know if there's an absolute limit.

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