According to regional statistics, the Northern Triangle of Central America — Guatemala, El Salvador, and Honduras — received a combined total of US$ 18.5471 billion in remittances during the first five months of 2025. Of that amount, Guatemala alone received US$ 9.9083 billion, accounting for 53.4% of the total and showing an annual growth rate of 16.4%.
From a macroeconomic perspective, these remittances represent approximately 14.6% of Guatemala’s GDP, placing the country among the top recipients of remittances relative to national economic size, alongside El Salvador, Honduras, and Nicaragua.
Beyond their sheer volume, the report warns about how these funds are being used: the majority is spent on household consumption, education, and housing, while only a small portion is allocated to savings or productive investment. This limits the long-term developmental impact of remittances and reduces their potential economic multiplier effect.
The authors of the report caution that although remittances are vital for economic stability and family welfare, Guatemala faces a structural dependency that makes it vulnerable to external shocks and international regulatory changes. For example, legislative proposals in the United States to impose taxes on remittances — such as a 5% fee on transfers made by undocumented migrants — could increase the cost of sending money and negatively affect both families and Latin American governments that rely on these funds.
The report also highlights that remittances serve as a form of economic insurance in adverse situations. Despite external shocks or crises, money transfers tend to remain stable or even increase, acting as a buffer for vulnerable households and contributing to internal consumption resilience.
However, the report stresses the need for public policies that transform these flows into tools for sustainable development. It proposes initiatives to promote financial inclusion among recipients, encourage the productive use of transferred money, and foster mechanisms that channel remittances into entrepreneurship, formal housing, and long-term savings.
The demographic context is also highly relevant: approximately 10% of the Guatemalan population resides in the United States, and many migrants send money back home monthly, with average transfers ranging between US$ 200 and US$ 300. The greatest impact is seen in rural areas and among the poorest households, which rely on these funds to cover essential needs.
Ultimately, the study emphasizes that remittances are more than just unilateral money transfers. They function as an economic engine, a social support system, and a transnational link between dispersed communities. Nevertheless, the challenge lies in converting this constant financial flow into a lever for inclusive and less dependent growth through coordinated action and policies that align remittance use with national development objectives.
