By Shane McGinley
Construction slowdown blamed, but officials predict recovery this year and growth in 2011.
Remittances from the UAE fell by 15 percent in 2009 but are predicted to recover this year and return to growth in 2011, officials said on Monday.
Around $50bn in remittances was transferred from the GCC in 2008 and it is the second largest global market, beaten only by the US.
In the UAE, where expatriates account for around 80 percent of the population, the Al Ansari Exchange estimates that the market is worth around $20bn.
However, Mohamed Al Ansari, chairman of the firm and the Foreign Exchange and Remittance Group, UAE (FERG), said remittances from the UAE had fallen by 15 percent last year, mainly due to the slowdown in the construction sector.
“While there has been a slight decline in the remittance business in the last year, which was mainly driven by many expatriates returning to their native countries, we are anticipating a perceptible improvement in the remittance business in 2010,” said Leon Isaacs, managing director of the International Association of Money Transfer Networks (IAMTN).
The World Bank has forecast that the global remittance market will be “almost flat” this year, but in 2011 will recover and see growth of around four percent.
There are 110 exchange companies in the UAE, over 550 branches and approximately 2.5m remittance transactions per month.
Probably because Al Ansariâ€™s exchange rates are extortionate.
Almost at every city corner or inside malls in Dubai there stood the remittance centers. Competition is stiff. However, the bulk of monthly-salaried expatriates have gone home. The courageous few or luckier opted to remain instead of returning home only to find themselves jobless. In a state of uncertainty, the economic needle shifts down into an expected level. Now, remittance centers are getting hit. But lucky are those â€˜big fishâ€™ from the once lucrative real estate and development sector or financial institutions. They had remitted a fortune into their home countries long before their shenanigans were unveiled or uprooted. Where have all the monies gone?