Home » New doors to development: Remittances and the housing industry in Colombia. by Milena Gomez Kopp
New doors to development: Remittances and the housing industry in Colombia. Milena Gomez Kopp

New doors to development: Remittances and the housing industry in Colombia.

Milena Gomez Kopp

Published
ISBN : 9781109346671
NOOKstudy eTextbook
324 pages
Enter the sum

 About the Book 

Remittances sent home by Colombian immigrants across the globe have grown rapidly since the 1990s, reaching the record level of {dollar}4.5 billion dollars in 2007. Remittances to Colombia are now the third largest remittance flow into Latin AmericaMoreRemittances sent home by Colombian immigrants across the globe have grown rapidly since the 1990s, reaching the record level of {dollar}4.5 billion dollars in 2007. Remittances to Colombia are now the third largest remittance flow into Latin America and the Caribbean region, after Mexico and Brazil. And remittances represent the second largest source of income for Colombia, after foreign investment. Recent research indicates that at least 70% of remittances are used for the recipient families daily consumption needs. Critics of the significance of remittances argue that remittance monies are not being invested productively.-This dissertation examines whether remittances can be channeled into productive endeavors and, in particular, documents their use for real estate investments. In 2004, immigrants began purchasing real estate in Colombia, motivated by dreams of returning to their country. Policies of the Colombian government and activities of the banking and the other industries have encouraged and supported these efforts. Immigrants purchases of real estate have increased, and these investments have positively impacted the Colombian construction business, generating jobs, development, and income. Although these developments are still in an early stage, there has been much enthusiasm in Colombia that remittances have fueled the Colombian housing boom since 2003. This dissertation will examine the real nature of the flows coming from abroad and judge their impact on the housing business in the past four years.-Although the 4.5 billion dollars sent home by expatriates only account for 2 percent of the countrys GDP, they represent a substantial sum and are critical for the lives of many. They have also forced the Colombian government to change its position vis-a-vis citizens abroad. While in previous periods the government neglected its expatriates almost completely, it is now pursuing new strategies to engage them. Immigrant outreach now stands among the top of Colombias priorities in its national agenda.-The productive use of remittances for investments, savings and innovative business enterprises has been an important component of government policy. The internationalization of the housing market serves as a useful case study to analyze how these monies can be invested in the Colombian economy to stimulate growth. This dissertation contributes to the ongoing discussion regarding the use and importance of remittance flows by documenting the interest of Colombian immigrants in investing in real estate back home, and by evaluating the evolution of the governments policy agenda toward both the Colombian diaspora and the construction industry. By analyzing the use of remittances for housing investments, this research study identifies best practices to promote and harness the development potential of remittances to Colombia.