At a Press Conference by the UNCTAD at the Ocean Bay Hotel on the 28th of November 2012, while launching the 2012 report on the LDCs, Representatives of the Governor of the Central Bank, UN Representative to the Gambia, the UN system, Diplomatic Corps, Representatives of Financial Institutions and members of the Press were present.
Mr. Bai Ibrahim Jobe, who chaired the conference in his introductory remarks, informed the gathering that the purpose of the meeting is to receive the 2012 UNCTAD Report on the LCDs. He also informed the audience that the report would be presented by the GIEPA Representative who would give the synopsis of the report, on behalf of the UNCTAD.
Mr. Ismaila Jarju, a Representative of the Governor of the Central Bank, in his preliminary comments said among other things that the importance of Remittances cannot be overemphasized. He said remittance inflows have exceeded exports in the Gambia. He also said it is the largest source of foreign exchange in the country.
Mr. Jarju said they had conducted some surveys and discovered that real estate had gone down at a time when remittances have declined. Jarju said the cost of sending remittances is very high. He however said work is underway to improve the regulations for the transfer of remittances. He added that one challenge is the data through RTI; that they are working with the Gambia Bureau of Statistics to help improve coverage on remittances. Mr. Jarju said they are also working with the Foreign Affairs to improve the impact of remittances on the country. He cited some countries, Ethiopia included, that have better policies in place where even doctors are encouraged to come and invest and operate in the country.
Mr. Samba Sallah of the Gambia Investment and Export Promotion Agency (GIEPA), presenting the Report in a power Point, indicated that the major focus of the Report is how to 'Harness Remittances and Diaspora Knowledge to Build Productive Capacities'.
After mentioning the list of Least Developed Countries numbering 48, including the Gambia, he said inflows of remittances stood at 10.35 million in 1990, 10.79million in 2000, 39.44 million in 2005 and 66.74 million 2011. He added that Remittances in Gambia is smoother than ODAs and FDIs.
Mr. Sallah asserted the importance of remittances, citing that it is 11.2% of the GDP. He however said costs of remittances are 12% for countries like the Gambia, which is 1% higher than the world average. He also said the challenge is how to channel these vast private money inflows to productive use.
"The starting point is the Istanbul Programme of Action (IPoA) for LDCs, which has stressed that "Remittances are significant private financial resources for households in countries of origin of migration. There is a need for further efforts to lower the transaction costs of remittances and create opportunities for development-oriented investment", said Mr. Sallah of GIEPA.
He then asked why remittance flows to the LDCs are growing? He said the number of people who emigrated from LDCs increased from 19 million in 2000 to 27 million in 2010, that 80% of LDC emigrants migrated within the South, mostly to South Asia, the Middle East, and Africa; that Remittances to LDCs grew from $3.5 billion in 1990 to $27 billion in 2011. Sallah, presenting the UNCTAD Report, said that Remittances now amount to 4.4% of GDP and 15% of exports, compared with 1.6% and 4.5% for other developing countries; that in 2011, remittances to LDCs were almost double the value of FDI (Foreign Direct Investment) inflows ($15 billion); that Remittances were only exceeded by official development assistance (ODA) as a source of foreign financing ($42 billion). He however said remittances are highly concentrated: top three LDC recipients (Bangladesh, Nepal and Sudan) receive 66% of total remittance inflows, he said.
Sallah went on to say that given the fragility of the global economy, the outlook for LDCs is subject to a high degree of uncertainty. He said Fiscal and monetary policy have less scope to provide a stimulus to the economy today than in 2008-2009; that unless the global downturn, which is also affecting large dynamic developing economies, reverses, LDCs have to prepare for a possibility of a lengthy period of stagnation and deflation.
"Of particular concern are external shocks from reversals of commodity prices and drying up of financing options", said Mr. Sallah of GIEPA, presenting the UNCTAD Report 2012 on the LDCs.
Mr. Samba Sallah of GIEPA said among many other things that 75% of Gambian graduates live abroad.
At the end of the presentation, Mr. Suwaibou Touray of the Foroyaa Newspaper raised two questions. He mentioned the issue of informal remittance inflows which he opined is larger than formal remittance inflows because of the costs associated with it. He asked what plans are in place for much of the informal remittance inflows to be captured and put into better productive investment?
Mr. Ismaila Jarju, a Representative of the Central Bank, said he has accepted that about 50% of remittances are Informal inflows. He said this is why they are conducting a household survey with the Bureau of Statistics on the issue. He however pointed out that this is a challenge for all countries of the LDCs.
Suwaibou also informed Mr. Sallah of GIEPA that many Gambians come home only to buy land and build compounds but do not normally engage in productive investment. He asked what GIEPA is doing to encourage Diasporan Gambians to invest in productive ventures in the country.
Mr. Sallah of GIEPA in response said GIEPA has spelt out various incentives for Gambians to invest in the country. He said last year they attended a Diaspora meeting in Scandinavia and also held meetings with Gambians and informed them of the opportunities in the Gambia, etc. He said they are doing everything to encourage Gambians to invest in the productive sector of the economy.
At the end of question time, Nafi Barry, representative from the Ministry of Trade said the Report is very important and Government would surely use it to harness remittances for productive use.
Mr. Bai Ibrahima Jobe, in his closing remarks, said they would want to share the Report with the Press so that the findings of the Report would be made known to the public. He also mentioned the collaboration with the UN System and said such collaboration would continue to attain what is highlighted in the Report. He also thanked the presence of the Turkish and other ambassadors and other banks who he said also benefit from the remittance inflows.