President Donald Trump’s crackdown on illegal immigration has had rippling effects that are just now starting to make themselves known. One such impact is in Mexico. Its economy is undergoing a change directly related to remittances: money earned in the United States by foreigners who then transfer it to their families, friends, and businesses back in their home country. In 2024, remittances represented about 3.4% of Mexico’s gross domestic product, according to the World Bank.
Mexico Losing Money
As per a report by BBVA Mexico, the country's largest financial institution, “[b]etween 2013 and 2024, remittances increased in nominal terms from $23 billion to $64.7 billion; that is, they almost tripled.” In fact, “Mexico received $5,201 million in remittances in June, representing a 16.2% decline compared to the same month the previous year. This is the largest drop in remittances since September 2012, almost 13 years ago.”
Rubi Bledsoe, a researcher with the Americas Program at the Center for Strategic and International Studies, told The Epoch Times, “One obvious reason for the decline in money flowing across the border is that fewer Mexicans are entering the United States. It has been harder for them, I guess, to access legitimate avenues to seek asylum,” she said.
New York state immigration attorney Marina Shepelsky opined to the outlet that illegal immigrants are lying low, worried about being sent back to their home countries. “I think a lot of people are saving money now in case they’re deported, so they’re not sending anything home.”
US Losing Billions of Dollars a Year
Of course, Mexicans are not the only immigrants, legal or otherwise, who practice this money exchange. According to a Federation for American Immigration Reform (FAIR) study, “U.S. remittances account for around 20 percent of the Gross Domestic Product (GDP) of multiple countries in Central America, including Honduras and El Salvador.” Furthermore, in 2021, the latest year with up-to-date statistics, at least 134 countries received remittances from the United States with “amounts ranging from a few thousand dollars to tens of billions of dollars.” The top five recipients of these monies from America were: Mexico ($52.6 billion), India ($15.8 billion), Guatemala ($14.7 billion), the Philippines ($12.8 billion), and China ($12.7 billion).
It’s important to keep in mind that this money was earned in the United States and sent out of the country. According to a July study published by FAIR, the US economy loses at least $200 billion annually in remittances to foreign countries. This information was from 2021, so the numbers are likely much higher now, considering that four years of President Joe Biden’s open borders policy saw a massive influx of both legal and illegal immigrants.
The One Big Beautiful Bill has a provision to discourage illegal immigration and remittances, a 1% fee for certain types of transactions to home countries – for example, when a sender provides cash, a cashier’s check, or a money order to companies such as Western Union or MoneyGram. The revenue collected could be used to strengthen immigration control measures, but Democrats argue that “remittances increase the spending power of households in poorer countries, potentially reducing poverty and increasing demand for U.S. exports,” ZeroHedge explained.
“When immigrants send money home, they’re not just helping loved ones — they’re keeping entire communities afloat in countries like Mexico, Nigeria, and the Philippines,” Illinois Democratic Rep. Jesús “Chuy” García said during debate on the bill.
But there are drawbacks to this. According to the FAIR study, “remittances distort the economies of receiving countries. They encourage ‘brain drain’ and undermine efforts to fight poverty and develop a sustainable economy. Even economists supportive of remittances acknowledge that they can ‘create a culture of dependency, lowering labor force participation in recipient nations, promoting conspicuous consumption, and accelerating environmental degradation.’ The lack of sustainable development, in turn, serves as a ‘push’ factor encouraging more migration to the United States.”
The study found that “Mexico benefits more than any other country from U.S. remittances. Mexican nationals living in the U.S. remit on average almost a fifth of their monthly incomes to Mexico.” In addition, “Overall, remittances to Mexico represent more than a quarter of the money sent out of the U.S.” However, the study showed that remittances to other countries are growing “significantly faster.”
FAIR estimates that “the illegal alien population grew 28.2 percent under the Biden administration, from 14.5 million in 2021 to at least 18.6 million in 2025.”
To demonstrate just how much money the United States is losing in remittances, FAIR explained that the $200 billion sent out of the country in 2021 “would be more than enough to operate the Department of Homeland Security (DHS) ($140.6 billion) and the State Department ($57.6 billion) combined.” It is also more than double the 2024 budget of the Department of Housing and Urban Development ($88 billion) “and almost four times the amount of money spent on the Department of Justice (DOJ) ($52 billion).”
Another worrisome product of remittances is that it helps to support cartels, human smugglers, terrorists, and organized crime. As the study revealed, “approximately $4.4 billion out of the $58.5 billion in total remittances sent to Mexico in 2022 were potentially linked to cartels.”
The decline in money wired to Mexico is not just a financial shift; it’s a reflection of changing immigration realities, border enforcement, and national priorities. While some argue remittances ease poverty abroad, the truth is they also drain resources at home and perpetuate cycles of migration that burden US communities.
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