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Sri Lankan foreign remittances in 2023 continue to ride a steady wave

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Sri Lanka_ Reviving from its worse economic depression in 2022, Sri Lanka is slowly yet steadily journeying upward to restore the country’s depleted finances. Amongst the many efforts taken to re-establish the island’s economic position, foreign remittances of migrant workers have been one of the largest sources of foreign revenue being brought into Sri Lanka. The International Monetary Fund defines foreign remittances as “earnings sent home by migrants in the form of cash or goods” and has identified this source of income as one of the largest and rapidly growing foreign revenue streams in many developing countries.

Sri Lanka recorded its most catastrophic socio-economic crisis in 2022 with the Sri Lankan rupee depreciating from 200 rupees per dollar to an all-time low of 360 rupees due to the staggering heights reached in inflation rates, halting commercial activities on the island, which inevitably resulted in mass chaos and a nationwide revolution.

Though gaining economic stability has been a tedious task for the country, a gradual increase in foreign remittances in the year 2023 is quite evident. As per the records of the Central Bank of Sri Lanka, the nation acquired a total of USD 3,789.40 MN in 2022 amidst heavy strains on the rupee. Sri Lanka also witnessed the migration of 311,269 individuals leaving the island to secure jobs as migrant workers as an effect of the intense economic struggle faced by citizens. However, Minister of Labor and Foreign Employment, Manusha Nanayakkara stated that the total earnings received so far this year through foreign workers, currently stand at USD 1,867.2 MN, setting a large margin as opposed to the low rate of foreign remittances last year.

As a developing nation that heavily depends on foreign revenue garnered by migrant workers’ remittances, it is vital to compare and contrast the years 2022 and the first quarter of 2023 in order to understand the current foreign remittance context.

Statistics from CBSL record that the month of January 2022 marked USD 259.2 MN in total foreign remittances sent by Sri Lankan expatriates, while January 2023 brought in a sum of USD 437.5 MN, kicking off the start of the year on a good note. February 2023 too, saw a rise in foreign remittance earnings with a monthly total of USD 407.7 MN as opposed to February 2022, which only recorded USD 204.9 MN.  Minister of Labor and Foreign Employment, Manusha Nanayakkara took to Twitter in the month of March to announce a significant increase in migrant workers’ remittance. He noted that a USD 249.9 MN increase (78.5%) from March 2022 was recorded, with Lankan expatriates sending USD 568.3 MN in March 2023 whereas only a total of USD 318.4 MN was acquired the same month last year.

It is interesting to note that amidst this surge in foreign remittance numbers in 2023, the month of April has recorded a slightly low remittance rate of USD 454 MN as opposed to the USD 568.3 MN of March 2023. Yet this month’s earnings show an 82.4% increase (USD 205.1 MN) from April 2022, signaling a steady escalation in migration workers’ remittances for the year 2023.

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