Constance Ikokwu
12 April 2008
Washington, DC — Nigeria is among the top 20 remittances recipient countries in the world with $3.3 billion remitted last year, says a World Bank Report.
World Bank had estimated in its report titled "Migration and Remittances Factbook 2008" that Nigerians in Diaspora remitted $3.3 billion in 2007. Kenya was the second highest recipient of remittances in 2007 with $1.3 billion, up from the $1.1 billion in 2006.
Sudan followed with $1.2 billion, Senegal and Uganda with $0.9 billion each, South Africa $0.7 billion, Lesotho $0.4 billion, Mauritius $0.2 billion, Togo $0.2 billion and Mali $0.2 billion.
An earlier report by the International Monetary Fund (IMF) measuring the flow of workers' remittances in 2004 put Mexico on top of the list followed by the Philippines, Spain, Lebanon, China, Morocco, Pakistan, Bangladesh, Egypt, Colom-bia, Portugal, Guatemala, El Salvador, Brazil, Poland, Nigeria, Dominican Repu-blic, Jordan, Indonesia and Ecuador.
Diaspora remittances have become a key foreign exchange for African countries with more than $5 billion sent back annually.
In 2006, a conservative estimate had it that sub-Saharan Africa received about $7.7 billion in inward remittances, with Nigeria accounting for over $3 billion.
In spite of the huge amount of money returned home, analysts worry that the piece meal nature in which remittances are made in Africa has limited impact on the continent.
Remittances have been on the increase for more than three decades and has had significant impact in the economies of developing countries, says the report.
From about $6 billion in the early 1970s, remittances increased to $50 billion in the mid 1990s, $114 billion in 2003 and $135 billion in 2005, the data revealed.
The report however noted that for policy purposes, what matters most is not the absolute number of remittance flows, but their magnitude as a percentage of the recipient countries' GDP.
Nevertheless, workers' remittances may not have uniform macroeconomic effects from country to country over time, it notes. The report urged policymakers in developing countries to conduct a thorough analysis of the effect of remittances on their economies.
The World Bank has been exploring the possibility of setting up a Diaspora Remittances Investment Fund modeled along successful initiatives in Latin America. The remittances are expected to help fund Diaspora-led initiatives in several countries.
The Bank is also exploring several approaches for working with the African Diaspora in the design and implementation of the ongoing portfolio of World Bank-assisted projects.
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