Collectively the Latino community is increasingly significant economically, with purchasing power expected to reach $926 billion by 2007.4 By 2010 the disposable income of Hispanics will exceed $1.08 trillion, or 9.2 percent of total purchasing power nationwide, according to the Selig Center for Economic Growth at the University of Georgia.5 Hispanic-owned businesses are an extraordinarily dynamic sector of the economy, growing at three times the national rate for all companies from 1997 to 2002.6 In terms of homeownership, by 2010 Latinos will account for nearly one third of the total home buying pool. The economic significance of recent Latino immigrants is also seen in the magnitude of remittances to their countries of origin. Estimates for the total amount of remittances from the U.S. to Latin American countries in 2005 range from $42.4 billion7 to $53.6 billion.8 In 2005 remittances by Latin American immigrants in Massachusetts totaled $448 million.9 Remittances to Latin America represent not only supplements for daily living expenses there but also important sources of investment and economic growth.10 The social, economic and political significance of the growth of the Hispanic population is now generally recognized. However, what is often overlooked is 4
Fact Sheet on ITINs and Financial Services. Immigrant Taxpayer Working Group of the National Community Tax Coalition. Retreived April 2006 from http://www.taxcoalition.org/Resource%20Library/ITINS_and_Financial_Services_FactSheet.pdf. 5
Associated Press. March 16, 2006 “Banks retool to meet needs of new market segment, the Latino immigrant”. 6
“Growth of Hispanic-Owned Businesses Triples the National Average.” U.S. Census Bureau News Release 3/21/06. Retrieved June 2006 from http://www.census.gov/PressRelease/www/releases/archives/business_ownership/006577.html 7
The World Bank, Global Economic Prospects 2006: Economic Implications of Remittances and Migration. 8
International Flows of Remittances: Cost, competition and financial access in Latin America and the Caribbean – toward an industry scorecard. M. Orozco, Inter-American Dialogue 5/12/06. 9
Lima, A. & Plastrik, P. The Boston Globe, May 31, 2006, “Hidden Assets of Boston’s Immigrants”. 10
According to Luis Moreno, President of the Inter-American Development Bank, remittances “...not only continue to provide resources for personal consumption and investment, but also precious foreign currency to bolster macroeconomic stability… IDB research estimates that about 20% of remittances to Latin America and the Caribbean, or US $11 billion annually, is available for savings, housing, and other forms of investments such as family owned small businesses. That is about as much as the IDB and the World Bank combined typically lend to Latin America and the Caribbean every year.” “Creating Posterity in Latin America”. Speech by L. A. Moreno, 4/28/06. Business Forum, Poder magazine, Miami, FL.
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