Remittances to developing countries are expected to reach $325 billion this year, up from $307 bn in 2009. The top recipient countries in 2010 are India, expected to receive $55 bn (Rs 2.44 lakh crore), followed by China ($51 bn).
Bangladesh to India is one of the four largest migration corridors in the world this year.
According to the migration and remittances unit of the World Bank, remittance flows to India grew robustly in the last quarter of 2009 and in the first quarter of 2010, but appear to have leveled off in the second quarter.
With a recovery in global demand, remittance flows to the East Asia and Pacific region are expected to grow 7.2 per cent and 8.5 per cent in 2011 and 2012, respectively, to $106 bn in 2012, according to the unit. It has released the Migration and Remittances Factbook 2011, which says worldwide, remittance flows are expected to reach $440 bn by the end of this year.
Hardy, too
The $307-bn of remittance flows to developing countries last year saw a 5.5 per cent decline from the previous one due to the global financial crisis. This compares with a 40 per cent decline in foreign direct investment (FDI) between 2008 and 2009 and an 80 per cent decline in private debt and portfolio equity flows from their peak in 2007.
“Recorded remittance flows to developing countries are estimated to have fully recovered to the pre-crisis level of $325 bn in 2010. In line with the World Bank’s outlook for the global economy, remittance flows to developing countries are expected to increase by 6.2 per cent in 2011 and 8.1 per cent in 2012, to reach $346 bn in 2011 and $374 bn in 2012, respectively.
The top remittance sending countries in 2009 were the US, Saudi Arabia, Switzerland, Russia, and Germany. Top recipient countries in 2010 are India, China, Mexico, the Philippines, and France.
Remittances amounted to 1.9 per cent of gross domestic product (GDP) of all developing countries in 2009, but were nearly three times as important (5.4 per cent of GDP) for the group of low-income countries. In some countries, it is more than 25 per cent.
The World Bank estimates around 200 million people live outside their countries of birth. Income differentials, as well as political and demographic forces, have the strongest effect on migration patterns.
Lifeline issues
“Remittances in 2008 and 2009 became even more of a lifeline to poor countries, given the massive decline in private capital flows sparked by the crisis,” said Dilip Ratha, manager of the Bank’s migration and remittance unit.
“However, high unemployment is prompting many migrant-receiving countries to tighten immigration quotas, which will probably slow the growth of remittance flows. Also, uncertain currency movements can have unpredictable effects on remittance flows,” Ratha added.
In addition to crisis-related risks, there are major structural and regulatory changes in the global remittance market. Regulations to combat financial crime have become a roadblock to the adoption of new mobile money transfer technologies for cross-border remittances.
“There is urgent need to reassess regulations for remittances through mobile phones and mitigate the operational risks,” Ratha said.
The report says the top migrant destination country is the United States, followed by Russia, Germany, Saudi Arabia, and Canada. The top immigration countries, relative to population — the percentages here show the percentage of residents who hail from elsewhere — are Qatar (87), Monaco (72), the United Arab Emirates (70, Kuwait (69) and Andorra (64).
Mexico to the United States is expected to be the largest migration corridor in the world this year, followed by Russia–Ukraine, Ukraine–Russia and Bangladesh–India.
According to the 2001 census, there are close to three million Bangladeshi nationals in India, but Ratha believes the actual number could be over 12 million now, according to other reports.
