Arizona law may hit Mexico's economy: Mexican central bank

13:35, May 07, 2010      

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A new law targeting migrants in the southern U.S. state of Arizona could well hit Mexico's foreign exchange receipts, Agustin Carstens, the governor of the Bank of Mexico, said Thursday.

"Inevitably U.S. migration policy will tend to grow more selective, strict and that will surely affect the family remittances phenomenon," said Carstens at the opening session of an Inter-American Development Bank (IDB) conference in Mexico City.

In late April, Arizona passed a law that forces police to investigate all cases of possible illegal immigration and allows citizens to sue if officers do not follow. Non-governmental organizations in the United States said it would be used by racists to harass all Latinos regardless of status. The presidents of the United States, Mexico, El Salvador and Guatemala have all slammed the new measure.

Around 10 percent of Mexico's 105 million population live in the United States. The money they send home is Mexico's second largest foreign exchange earner after crude oil exports. Remittance income has been falling since late 2008 because of recession in the United States that began in the housing sector, the top employer of Mexicans in its northern neighbor.

On Wednesday, Marco Adame Castillo, the governor of the southern Mexico state of Morelos, said his administration had begun reviewing all the agreements it has with Arizona with a view to cancel them. Around 5,000 Morelos citizens live in Arizona, he estimated.



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