Remittances to fall by 20pc globaly: study

Remittances are projected to plummet by a record 20 per cent in 2020 globally as the world’s largest remittance-sending countries have experienced stringent lockdowns amid the COVID-19 pandemic, according to a Pew Research Center analysis.

The center, which based its projection on data from the World Bank, Oxford University and Google, said that remittances might decline from a high of US$714 billion in 2019 to an estimated US$572 billion in 2020.

Bangladesh would be a victim of the fall in remittances due to lockdowns and job cuts in major source countries, local experts in Dhaka said on Tuesday, as the country was expecting US$18 billion in remittances for the fiscal year 2020–21. 

‘The sharp reduction in remittances would be an added burden for Bangladesh people and the economy,’ Policy Research Institute executive director Ahsan H Mansur told New Age. 

The 10 countries that sent 61 per cent of the world’s remittances— money sent by migrants to their home countries— in 2018 (the most recent year for which bilateral remittance data is available) have spent an average of 10 more days under coronavirus-related lockdowns – and experienced greater declines in physical mobility near workplaces – than other countries, the analysis, released on Monday, shows.

Among the world’s top remittance-sending countries, the United States experienced a 29 per cent average workplace mobility decline, Saudi Arabia 32 per cent, the UAE 29 per cent, the United Kingdom 41 per cent, Canada 36 per cent, Germany 25 per cent, France 43 per cent, Australia 18 per cent and Italy 45 per cent.

Data on reduced workplace mobility in Russia was unavailable although the country underwent work restrictions for 82 days.

The same top remittance senders experienced an average of 67 days under workplace closures or stay-at-home orders as of May 28, compared with an average of 57 days for the other 154 countries or territories for which data is available.

These 10 countries experienced an average 33 per cent decline in physical mobility around the workplaces from February 15 to May 21, compared with a 26 per cent decline among the other 116 countries or territories for which data is available.

The decline in remittances is projected to hit all regions of the world, as many of the 272 million international migrants have lost their jobs and stopped sending money home.

The Kingdom of Saudi Arabia, the UAE, Kuwait, the UK, Malaysia, Oman, Qatar, Italy and Singapore were the top 10 sources of remittances for Bangladesh in the first eight months of 2019–20, according to Bangladesh Bank documents.

Remittances form more than 10 million citizens abroad along with exports, mainly readymade garments, are the key sources of foreign exchange for Bangladesh.

The remittance inflows from wage earners to Bangladesh were US$16.4 billion in 2018–19, US$15 billion in 2017–18 and US$12.7 billion in 2016–17, according to Bangladesh Bank documents.

Several thousand Bangladeshi workers returned after losing jobs in different countries in recent months amid the spread of COVID-19 globally.  

Ahsan H Mansur said that Bangladesh was going well on remittances before the COVID-19 pandemic.

Indicating the recent surge in return of workers home from abroad, he said, ‘The government should lobby with the worker-recipient countries so that they do not send our workers in one go.’

The government should also take steps so that the returned workers could be reemployed in their respective areas of expertise, he said, adding that the country would also need to address the shortfalls in productions at home, exports and the overall growth. 

Refugee and Migratory Movements Research Unit of Dhaka University on Monday said, with reference to a study released on Monday, that many foreign countries forcibly sent back workers without even any notice. 

RMMRU executive director CR Abrar said that the government should take steps so that the returned workers got compensation for sudden unnoticed job cuts by their employers abroad.       

Bangladesh was the 11th highest recipient of remittances while the top 10 recipients were India, China, Mexico, the Philippines, Egypt, France, Nigeria, Pakistan, Germany and Vietnam.

In 2009, global remittances declined 5 per cent as economies shrank during the great recession. In 2016, remittances fell one per cent, driven by weak growth in many countries and lower oil prices.

News Courtesy: www.newagebd.net