US curbs make remittances to Cuba expensive, says study

March 6th, 2009 - 10:06 pm ICT by IANS  

Washington, March 6 (EFE) The restrictions on sending remittances to Cuba from the US are making cash transfers three times more expensive compared to the rest of Latin America, a study has said.
The report is based on a survey conducted by experts at the Inter-American Dialogue, a ploicy organisation, and Florida International University among 500 Cubans between December 2008 and January 2009. Three hundred participants in the survey were based in the US and the rest were from Cuba.

The study said the US residents who send money to the island pay an average of 15 percent of the total amount toward fees, compared to just five percent surcharge for the rest of the region.

Manuel Orozco, the main author of the report, said Cubans who receive remittances from the US have to pay an additional 10 percent to exchange the dollar into Cuban currency, besides other fees.

Orozco said Havana had introduced unfavorable regulations partially in response to the restrictions imposed on cash transfers by Washington in 2004.

He said a combination of factors would explain why informal methods of sending cash to Cuba are increasing.

According to the report, 40.2 percent of the Cubans interviewed said they received money via an informal channel, such as through relatives who travel to the island or people who specialise in transferring cash clandestinely.

Orozco and Katrin Hansing of the Florida International University Thursday called for elimination of restrictions on remittances both by Cuba and the US, citing humanitarian and social reasons.

As per the US rules, the remittances to Cuba are restricted to a maximum of $1,200 annually per family and the recipient of the funds should be a close relative.

“If the restrictions are lifted on the quantity (amount of money), people would be able to save more,” Orozco said, adding that it would allow the recipients to improve their living conditions at home.

Orozco said Cuba received about $1 billion in remittances in 2008.

Related Stories

Tags: , , , , , , , , , , , , , , , , ,

Posted in Business |