The Gulf region, which has large numbers of migrant workers, continues to see "robust growth" in remittance flows when compared to Western Europe, a new World Bank report has said.
It said remittance flows to the developing world are expected to exceed earlier estimates and total $406bn this year, an increase of 6.5 percent over the previous year.
Remittances to developing countries are projected to grow by 7.9 percent in 2013, 10.1 percent in 2014 and 10.7 percent in 2015 to reach $534bn in 2015, the report added.
Worldwide remittances, including those to high-income countries, are expected to total $534bn in 2012, and projected to grow to $685bn in 2015, according to the latest issue of the Bank’s Migration and Development Brief.
However, despite the growth in remittance flows overall to developing countries, the continuing global economic crisis is dampening remittance flows to some regions, with Europe and Central Asia and Sub-Saharan Africa especially affected.
South Asia and the Middle East and North Africa (MENA) are expected to fare much better than previously estimated, the report said.
The top recipients of officially recorded remittances for 2012 are India ($70bn), China ($66bn), the Philippines and Mexico ($24bn), and Nigeria ($21bn).
Other large recipients include Egypt, Pakistan, Bangladesh, Vietnam, and Lebanon.
Hans Timmer, director of the Bank’s Development Prospects Group, said: “Although migrant workers are, to a large extent, adversely affected by the slow growth in the global economy, remittance volumes have remained remarkably resilient, providing a vital lifeline to not only poor families but a steady and reliable source of foreign currency in many poor remittances recipient countries.”
He said regions with large numbers of migrants in oil exporting countries, such as the GCC, continue to see robust growth in inward remittance flows, compared with those whose migrant workers are largely concentrated in the advanced economies, especially Western Europe.
Therefore, South Asia, MENA and East Asia and Pacific regions, with large numbers of workers in the GCC countries, are seeing better-than-expected growth in remittances.
For South Asia, remittances in 2012 are expected to total $109bn, an increase of 12.5 percent over 2011; East Asia and Pacific region is estimated to attract $114bn, an increase of 7.2 percent over 2011; while MENA is expected to receive $47bn, an increase of 8.4 percent over the previous year.
Remittances are expected to remain flat to Europe and Central Asia and Sub-Saharan Africa regions, mainly because of the economic contractions in high-income European countries.
“Migrant workers are displaying tremendous resilience in the face of the continuing economic crisis in advanced countries,” said Dilip Ratha, manager of the Bank’s Migration and Remittances Unit and lead author of the Migration and Development Brief.
“Their agility in finding alternate employment and cutting down on personal expenses has prevented large scale return to their home countries.”
Going forward, the World Bank expects continued growth in remittance flows to all regions of the world, although persistent unemployment in Europe and hardening attitudes towards migrant workers in some places present serious downside risks.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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