World Bank: Recent data on Global Remittance

The World Bank recently released its “Migration and Development Brief”. The report said that the remittance flows to the low-income and middle-income countries were 1.9% lower in 2020 as compared to that of 2019. It was 540 billion USD in 2020 and 548 billion USD in 2019.

Key Findings

  • The reduction in remittance inflows were smaller than that of 2009 Global Financial Crisis.
  • However, the remittance inflows to China reduced by 30% in 2020.
  • The inflows to the Caribbean and Latin countries increased by 6.5%
  • Increased by 5.2% in south Asia
  • Increased by 2.3% in North Africa
  • In Pacific and East Asia, it fell by 7.9%
  • Fell by 2.3% in North Africa and Middle East
  • Fell by 9.7% in Central Asia and Europe
  • Fell by 12.5% in Sub-Saharan Africa
  • Apart from China, the remittance inflows declined greatly in Nigeria. It fell by 28%.

India and its Neighbourhood

  • In 2019, India received 83.3 billion USD remittances. This fell by 0.2% in 2020. This was maximum in remittance from UAE. The remittance from UAE to India reduced by 17%.
  • In Pakistan, the remittances increased by 17%. The biggest growth in remittances to Pakistan came from Saudi Arabia.
  • The remittances in Bangladesh increased by 18.4%
  • In Sri Lanka, it increased by 5.8%
  • In Nepal, it fell by 2%

What is Remittance?

It is a sum of money sent from one country to other country. It can be business payments or remittances paid to a family member, friends.

How are remittances important?

  • They help the currency to hold its value against a foreign currency.
  • The World Bank says that the remittances are the second largest resource inflow for developing countries after FDI.
  • As the flow of remittances increases, the currency value of receiving country increases and the value of foreign currency depreciates.

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