Remittances in 2018 stare a higher growth
In its advance 2018 report, Global Knowledge Partnership on Migration and Development (KNOMAD) Brief 30, affirms cross-border money transfer is still an indispensable component of the global economy after noting a further accelerated remittance flows. The report estimates in 2018 migrants will remit $ 528 billion to low-and middle-income countries (LMICs), an upturn of 10.8 percent over the 2017 remittances.
The remittances have been experiencing an upwelling trend, in 2017 a robust growth of 7.8 percent was recorded boosting foreign exchange earnings in many LMICs. The Migration and Development Brief 29 had earlier failed to project a significant remittance growth in the last seven months, whereas the Brief 30 attributes the strength of the remittance flows to “recent economic developments.”
The U.S. economy has been strong and its dollar is gaining strength against other dominant currencies. The United States higher economic growth means the household incomes are increasing and migrants from LMICs have enough disposable income to remit to their home countries to cater for the needs of relatives and friends.
The Trump administration took a foremost step towards the end of his first year in the White House to pass a legislation that cut taxes in an effort to raise household incomes, in effect this must have sped up remittances to developing nations, especially by the migrants in the country.
In brief, the Migration and Development Brief 30 alludes that the growing U.S. economy coupled with what it describes as “a rebound in remittances outflows from some Gulf Cooperation Council (GCC) countries and the Russian Federation” as a major boost in the increasing remittance flows.
Regional Remittance Trends
Sub-Saharan Africa is anticipated to receive growth rate of remittance of 9.8 percent, which is higher than that of the Middle East and North Africa by 7 percent. Europe and Central region is expected to reach a 20 percent remittance growth, hinged on the recovering Russian economy as Latin America and Caribbean project a surge of 6.6 percent. South Asia is expected to register 13.5 percent increase, where Bangladesh and India will record double digits in remittance.
Commentary By Owen
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