By Adedapo Adesanya
As economies faced the downturn of the coronavirus pandemic, the World Bank has disclosed that remittance inflows into Nigeria declined by 28 per cent in 2020 to $17.2 billion.
The Bretton Wood Institution also said remittance flows fell for Sub-Saharan Africa by 12.5 per cent, according to its Migration and Development Brief 33 Phase 11 report titled COVID-19 Crisis Through a Migration Lens published on Thursday.
The report said the decline in remittance flows to Nigeria was largely responsible for the fall in remittance flows to Sub-Saharan Africa as it alone accounted for over 40 per cent of remittance flows to the region.
“The decline inflows to Sub-Saharan Africa was almost entirely due to a 28 per cent decline in remittance flows to Nigeria.
“Excluding flows to Nigeria, remittances to Sub-Saharan Africa increased by 2.3 per cent, demonstrating resilience,” the report stated.
“Remittance flows to the region were affected by the COVID-19 pandemic, in particular by restricted mobility measures and the employment situation in the main host countries,” it added.
But the World Bank is projecting that in 2021, remittance flows to the region will rise by 2.6 per cent ($43 billion) and 1.6 per cent ($44 billion) in 2022.
It predicted that “remittances are expected to be supported by improving growth prospects in the United States and other high-income host countries.”
Globally, in 2020, officially recorded remittance flows to low- and middle-income countries reached $540 billion, only 1.6 per cent below the $548 billion seen in 2019.
Remittances exceeded foreign direct investment flows by a wider margin in 2020. Excluding China, remittance flows surpassed the sum of foreign direct investment and official development assistance.
Among regions, remittances to Latin America and the Caribbean grew by 6.5 per cent in 2020, supported by a recovering economy and moderately improving labour market in the United States.
In South Asia, there was a slight moderation in the growth of remittance flows in 2020, to 5.2 per cent, while flows to the Middle East and North Africa grew by a modest 2.3 per cent. Flows to Europe and Central Asia are estimated to have fallen by 9.7 per cent, to East Asia and the Pacific by 7.9 per cent.
In 2020, in current US dollar terms, the top five remittance recipient countries were India, China, Mexico, the Philippines, and the Arab Republic of Egypt. India has been the largest recipient of remittances since 2008.
As a share of gross domestic product (GDP), the top five remittance recipients in 2020 were, by contrast, smaller economies: Tonga, Lebanon, Kyrgyz Republic, Tajikistan, and El Salvador.
The United States was the largest source country for remittances in 2020, followed by the United Arab Emirates (UAE), Saudi Arabia, and the Russian Federation.
Dipo Olowookere