Sun, Nov 04, 2012 - Page 14 News List

Spanish migration to Latin America surges as recession bites

By Gabriel Stargardter and Paul Day  /  Reuters, MEXICO CITY and MADRID

In Spain, he went without work for eight months after the housing bubble, fed by cheap loans, burst in 2008, sending shock waves throughout the economy. In Ecuador, he is now a bodyguard for a local businessman in the city of Guayaquil.

Far fewer Latin Americans are heading to Spain. In 2007, almost 314,000 were granted residency and by last year that was down to 119,416, according to official data.

Spain, the eurozone’s fourth-largest economy and the current focus of its almost three-year-long debt crisis, is under intense pressure to reduce its public deficit and prove to nervous investors it can put its finances in order.

Spanish Prime Minister Mariano Rajoy, in power since December, has responded to the national crisis by slashing spending. That has cut deeply in to education, training schemes and state-supported internships.

Critics say the policies will push Spain deeper into recession and optimists concede that things will get worse before they get better.

“The best solution for younger unemployed is unfortunately to leave Spain,” JP Morgan said in a note.

Some of the young are listening. The vast majority of those leaving Spain are between 20 and 40 years old.

From 2000, Spain’s population showed solid annual growth, almost entirely due to immigration, but the pace dropped sharply in 2008 and it began to shrink last year. Some estimates suggest its 46 million population could fall by 1 million by 2020.

FRANCO YEARS

During the dictatorship of General Francisco Franco, from the end of the civil war in 1936 to his death in 1975, hundreds of thousands of people fled oppression to Europe and the Americas.

The recent jump in Spanish emigration has prompted some to draw parallels, although that’s a stretch.

“It’s ridiculous to call this an exodus as it doesn’t compare to the enormous levels of emigration in the years following the civil war and in the late [19]60s,” Fernandez Huertas said. “But the speed of the rise is certainly noteworthy.”

Massive population drains can often be detrimental to an economy, but with the outlook already grim, it may help.

“It might net a positive if they’re going to be sending remittances back to their families,” said Bill Adams, senior international economist for US-based bank PNC. “It’s a strange inversion to think of Spanish immigrants in Latin America sending remittances back to Spain.”

Between 2007 and last year, remittances to Spain by Spanish migrants rose 7.5 percent to a record 5.7 billion euros (US$7.4 billion).

Nieves Mendez, a Mexico City dance instructor originally from the Spanish island of Tenerife, emigrated to Mexico when she struggled to find anything better than retail work after graduation.

Back in Spain’s Canary Islands, her mother and sister are unemployed. Her grandmother, who lives with them on a monthly pension of 200 euros, cares for Mendez’s disabled aunt.

“And I’m here, doing everything I can to send them something, however small,” said Mendez, 31. “Just a little so I know they’re not doing too badly.”

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