Monthly remittance inflow hits 5-year low in July [ Tritiyo Matra News ]

Monthly remittance inflow hits 5-year low in July

Local August 03, 2016

Monthly inward remittance in July registered the lowest amount of $1,005.43 million in last five years as the expatriate Bangladeshis sent home a lower amount of greenback after the Eid festival.
The figure of July, first month of the financial year 2016-2017, is also disappointing as the inward remittance in the just concluded FY16 fell from the previous FY15.
The BB data showed that the July remittance inflow was 27.54 per cent lower than the $1.38 billion posted in July, 2015.
According to Bangladesh Bank statistics, the inward remittance posted $908.79 million in November 2011 which was the lowest figure before July of this year.
The expatriate Bangladeshis sent the highest amount of greenback amounting to $1.49 billion in July 2014.
A BB official told New Age on Tuesday that the country’s inward remittance usually decreased after Eid-ul-Fitr and Eid-ul-Azha, but July’s figure of inward remittance declined remarkably.
The country celebrated the Eid-ul-Fitr, which is one of the biggest religious festivals for Muslims, on July 7.
Besides, the country faced extremist attacks in July which might create panic situation among the expatriate Bangladeshis who refrained from sending money to their relatives.
The country’s inward remittance also decreased by 2.55 per cent year-on-year dropping below $15 billion in the recently concluded fiscal year 2015-16.
The remittance inflow in FY16 decreased to US$ 14.92 billion from US$ 15.31 billion in FY15.
Former interim administration finance adviser AB Mirza Azizul Islam told New Age on Tuesday that the latest terrorist attacks might put an adverse impact on the inward remittances as the NRBs might feel insecurity to send greenback to their near and dear ones.
Besides, the global oil price slump was a reason behind the downtrend in remittance inflow, as the lion’s share of Bangladesh’s remittance earning comes from the Middle East countries which are most influenced by oil price movement, he said.
Kingdom of Saudi Arabia has recently entered in the trade deficit situation from a surplus zone due to oil price slump, he said.
The majority of Bangladeshi expatriate workers are now working in the Middle East countries and the economies of that region mainly depended on the income received from petroleum exports.
Mirza Aziz said the lower prices of petroleum products have hit the business in the Middle East, resulting in squeezing of their spending.
The government has no statistics of what number of workers were now being forced to come back to the country due to economic crisis in the Middle East, he said.
He said, ‘The expatriate Bangladeshis, who are now working in different countries of Middle East, may also face salary cut which ultimately put an adverse impact on the inward remittances’.
The BB and the government should jointly investigate in this regard, he suggested.
The gap of exchange rate between the central bank and scheduled banks is another cause of declining trend in the inward remittance, Mirza Aziz said.
He said the decreased trend in inward remittance would hit the consumption demand of lower-middle class and lower class people as majority number of the workers went abroad from those sections.
BB chief economist Biru Paksha Paul told New Age that the inward remittance had mainly dropped in July due to declining trend in the oil price in Middle East.
According to the BB data, in July the private commercial banks received US$ 670.35 million from inward remittance, while the state-run commercial banks received US$ 312.41 million, foreign commercial banks US$ 13.03 million, and specialised development banks US$ 9.62 million.
In July, Islami Bank Bangladesh received the highest amount of remittance of US$ 251.04 million among the private commercial banks, while Agrani Bank got the highest amount of US$ 122.14 million among the state-run banks.