Diaspora (Commonwealth Union) _ The World Bank foresees that diaspora remittances into Nigeria will exceed $20 billion by the year’s end. This optimistic projection reflects the resilience and significance of remittances as a vital financial lifeline, contributing substantially to the country’s economic landscape and providing crucial support to families and communities. The latest Migration and Development Brief from the World Bank projects that global remittance flows will continue to grow in 2023, albeit at a slower pace. Remittances to Sub-Saharan Africa are estimated to increase by 1.9%, reaching $54 billion in 2023. Nigeria, accounting for 38% of remittance flows to the region, experienced a growth of about 2%. The decelerated growth is attributed to the sluggish pace in high-income economies, where numerous Sub-Saharan African migrants earn their income. The economic challenges in these regions directly impact the remittance flow, reflecting the interconnected nature of global financial dynamics and the influence of high-income economies on the financial well-being of migrant populations in Sub-Saharan Africa.
The report also highlights that fixed exchange rates and capital controls are diverting remittances from official to unofficial channels. Remittances from the United States have remained stable, while the euro area is still below pre-pandemic projections. In 2024, remittance flows to the region are projected to increase by 2.5%. The Lead Economist and lead author of the report, Dilip Ratha, emphasized the importance of leveraging remittances for private capital mobilization to support development finance, especially through diaspora bonds. In recent years, remittances have emerged as a substantial source of private external finance, outpacing both foreign direct investment and official development assistance. This shift underscores the increasing economic impact of remittances, highlighting their role as a key driver of financial inflows that significantly contribute to the well-being of individuals and families across borders.
Link: https://documents.worldbank.org/en/publication/documents-reports/documentdetail/099122823033088601/P15789117f15300a51ac1a1c9040aff9b48
