The World Bank has revealed that Nigeria received a total of $21 billion from its citizens living abroad as home remittance in 2014 saying that growth of remittance is expected to slow this year.
In the latest issue of the World Bank’s Migration and Development Brief, released in Washington at the ongoing Spring Meetings of the IMF/ World Bank Group, the bank said that officially recorded remittances to the developing world are expected to reach $440 billion in 2015, an increase of 0.9 percent over the previous year.
Global remittances, including those to high income countries, are projected to grow by 0.4 percent to $586 billion.
It said that “The top five migrant destination countries continue to be the United States, Saudi Arabia, Germany, Russia and the United Arab Emirates (UAE) while the top five remittance recipient countries, in terms of value of remittances, continue to be India, China, Philippines, Mexico and Nigeria.
The release said “Nigeria alone accounts for around two-thirds of total remittance inflows to Sub Sahara Africa, but its remittances are estimated to have remained flat in 2014, at roughly $21 billion”.
It said that “growth of remittances to the Sub-Saharan Africa region is projected to slow to 0.9 percent in 2015, amounting to $33 billion. The regional growth in remittances in 2014 largely reflected strong growth in Kenya 10.7 percent, South Africa 7.1 percent and Uganda 6.8 percent.
“The level of remittance dependency varies across countries. Remittances in the Gambia, Lesotho, Liberia and Comoros equal about 20 percent of GDP in 2013, the latest available data. Remittance flows to the region are expected to pick up to $34 billion in 2016 and $36 billion in 2017.
“In Somalia, concerns are rising about the impact on remittances due to “de-risking”– the closing of bank accounts of money transfer operators by correspondent banks fearing risks of money laundering and financial crime.”
The World Bank said that “growth in global remittances, including those to developing countries, will slow sharply this year due to weak economic growth in Europe, deterioration of the Russian economy and the depreciation of the euro and rubble.
The 2015 remittance growth rates are the slowest since the global financial crisis in 2008/09. Nonetheless, the number of international migrants is expected to exceed 250 million in 2015, and their savings and remittances are expected to continue to grow.
The slowdown in the growth of remittances this year will affect most developing regions, in particular Europe and Central Asia where flows are expected to decline by 12.7 percent in 2015.
“The positive impact of an economic recovery in the U.S. will be partially offset by continued weakness in the Euro Area, the impact of lower oil prices on the Russian economy, the strengthening of the US dollar, and tighter immigration controls in many remittance source countries.
“In line with the expected global economic recovery next year, the global flows of remittances are expected to accelerate by 4.1 percent in 2016, to reach an estimated $610 billion, rising to $636 billion in 2017.
Remittance flows to developing countries are expected to recover in 2016 to reach $459 billion, rising to $479 billion in 2017.
The global average cost of sending $200 held steady at eight percent of the value of the transaction, as of the last quarter of 2014. Despite its potential to lower costs, the use of mobile technology in cross-border transactions remains limited, due to the regulatory burden related to combating money laundering and terrorism financing, says the Brief.
International remittances sent via mobile technology accounted for less than 2 percent of remittance flows in 2013, according to the latest available data.
In addition to sending money to their families, international migrants hold significant savings in their destination countries. ‘Diaspora savings’ attributed to migrants from developing countries were estimated at $497 billion in 2013, the latest data available.
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