Haiti - FLASH : The World Bank predicts a collapse in 2020, of remittances from the diasporas

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Haiti - FLASH : The World Bank predicts a collapse in 2020, of remittances from the diasporas
23/04/2020 09:30:12

According to the World Bank due to the economic crisis caused by the Covid-19 pandemic and containment measures, migrants' remittances worldwide are expected to drop by 19.7% in 2020 to 445 billion. This expected decline, the sharpest in recent history, is largely due to a fall in wages and employment for migrant workers, who are often particularly exposed to loss of income and employment in the event of an economic crisis in their country. of reception.

Remittances should fall in all regions with a particularly marked decline in Europe and Central Asia (27.5%), ahead of sub-Saharan Africa (23.1%), South Asia (22.1%), the Middle East and North Africa (19.6%), Latin America and the Caribbean (19.3%) and East Asia and the Pacific (13%).

The expected collapse in 2020 comes as remittances to low- and middle-income countries hit a record of $554 billion in 2019. Still, remittances are expected to be an even greater source of external funding for these countries, faced with a more marked decline (more than 35%) in Foreign Direct Investment (FDI).

"Migratory remittances are a vital source of income for developing countries. The economic recession caused by the Covid-19 pandemic seriously undermines the ability of migrants to send money home, and makes the need to accelerate the speed of recovery of advanced economies all the more important," said David Malpass, President of the World Bank Group adding "Migrant remittances help families meet their food and health expenses and provide for their basic needs. As the World Bank Group deploys swift and far-reaching measures to support countries, we are working to maintain channels for the flow of these funds to preserve access by the poorest communities to these vital goods."

In addition, the World Bank is working with G20 countries and the international community to reduce transfer costs and improve financial inclusion for the benefit of the poor. Globally, the average cost of a $200 transfer remains high, at 6.8% in the first quarter of 2020, just under a year ago.

For 2021, the World Bank provide a recevry of remittances to $470 billion, an increase of 5.6%. Without precise information to measure the impact of the Covid-19 pandemic on the prospects for world growth and the measures taken to halt the spread of the virus, the evolution of remittances is difficult to predict. Usually these flows tend to be countercyclical, with migrant workers sending more money in times of crisis and hardship at home. But this time, because it affects the whole planet, the pandemic creates additional uncertainties.

HL/ HaitiLibre