By IPS Correspondents
WASHINGTON, Sep 17 2007 (IPS)

U.S. immigrant groups are ratcheting up a boycott of Western Union Co. in hopes of forcing the global money-transfer industry to do good for its customers&#39 families, not just do well for itself.

Foreign workers complain that wire-transfer firms set extortionate fees and exchange rates, and that the industry fails to reinvest in the very communities from which it profits. Western Union is being targeted for its size: It is the biggest player in the United States and ranks among the largest in the world.

"We choose to stand up for our right to live in dignity and fight for our families," said Francis Calpotura, executive director at the Transnational Institute for Grassroots Research and Action, or TIGRA. The network of 158 immigrant groups is spearheading the boycott, begun last week in California and slated for nationwide expansion starting on Monday.

Immigrant workers in the United States send home some 70 billion dollars in earnings a year and the firms handling this trade skim more than 14 billion dollars a year, mainly in transaction fees, market analysts say.

Remittances from foreign workers around the world amounted to around 250 billion dollars last year and the figure is increasing by nearly one-third a year, according to the World Bank.

Western Union, spun off from U.S.-based First Data Corp. in September 2006, is a 4.5-billion-dollar business. Migrant workers say the company owes its success to them and they mean to cash in.

The company countered that it could not have attracted so much business had it charged uncompetitive fees.

Additionally, the Colorado-based firm announced late last week that it would give away 50 million dollars in educational and economic charity over the next five years. It said its "Our World, Our Family" initiative would channel the money through the philanthropic Western Union Foundation and through Mercy Corps, a U.S.-based international aid group.

"Education and economic opportunity means providing people around the world with the tools to succeed," said company president and chief executive Christina Gold. "With Our World, Our Family, we will help open doors to new opportunities supporting global citizens on their journey to a better life."

Even so, protest leaders said they would press on with their boycott.

"The new initiative merely re-packages its [Western Union&#39s] current giving programme," TIGRA said in a statement. "It fails to address the campaign&#39s key demands."

Our World, Our Family would raise Western Union&#39s overall philanthropic spending to 49 cents of every 100 dollars in profit, up from 41 cents, according to TIGRA. It compared this with 2.30 dollars for every 100 dollars of profit for leading retailer Wal-Mart and 7.50 dollars for ice cream maker Ben and Jerry&#39s, a unit of Unilever.

Protesters said they would pressure Western Union to increase its charity and to give directly to groups working with immigrant communities. Mercy Corps, they said, lacked experience of working with such communities in the United States. Boycott organisers also want the company and its subsidiaries, Vigo and Orlandi Valuta, to reduce their transaction fees and set more favourable exchange rates.

In many poor countries, remittances from workers overseas exceed international aid.

Remittances to Latin America and the Caribbean surpassed 60 billion dollars in 2006 and about three-fourths of this came from workers in the United States, according to the Inter-American Development Bank (IDB). This money exceeded foreign direct investment and official aid combined and, in six of the region&#39s countries, accounted for more than 10 percent of national income.

The largest recipients of remittances are Asian countries, including India (about 26 billion dollars a year), China (23 billion), and the Philippines (14 billion dollars).

The flows are so large that development lenders – the IDB in the western hemisphere and the Asian Development Bank to the east – and the governments of countries receiving remittances are seeking ways to lower transaction costs and channel more remitted money into investment projects.

The transaction costs of money transfers often exceed 20 percent, researchers have said, adding that reducing these costs by even a few percentage points could yield savings of billions of dollars a year for workers sending money home.

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