(Ecofin Agency) - Following the previous dip of remittances to sub-Saharan Africa by 0.4% in 2019 and 12% in 2020 due to the pandemic, things have improved this year. According to data from the World Bank, money sent home this year, by sub-saharan Africans in Diaspora has amounted to $45 billion. This is 6.2% higher than last year.
The rebound in remittances, which represent a real social safety net for many families, goes with a gradual recovery in the global economy. The money supports household spending on essential items such as food, health, and education during economic hardship.
“Remittance flows from migrants have greatly complemented government cash transfer programs to support families suffering economic hardships during the COVID-19 crisis. Facilitating the flow of remittances to provide relief to strained household budgets should be a key component of government policies to support a global recovery from the pandemic,” said Michal Rutkowski, World Bank Global Director for Social Protection and Jobs.
According to the World Bank, “for a second consecutive year, remittance flows to low- and middle-income countries (excluding China) are expected to surpass the sum of foreign direct investment (FDI) and overseas development assistance (ODA)”.
However, families in SSA deplored the high cost of money transfers. In the first quarter of 2021, transfer fees were estimated to be 8% of the amount transferred the highest in the world.
Although Nigeria is the largest recipient of remittances in sub-Saharan Africa, countries where remittances have the greatest impact on the economy include the Gambia (33.8%), Lesotho (23.5%), Cabo Verde (15.6%) and Comoros (12.3%). On the continent as a whole, Egypt remains the largest remittance recipient. The country is expected to receive $33 billion this year.
Moutiou Adjibi Nourou