On 27 and 28 March 2014, Tunis is scheduled to host a very important event on remittances of African migrants. This seminar is the culmination of over six years of work, characterized by tangible achievements: field studies, publications, workshops, lessons learned, stakeholder involvement, the creation of dedicated funds etc.
A high level seminar with a pan-African dimension
The event is being organized over two days by the AfDB, in partnership with the AFD and the French Government. Attendees are expected from all over the continent, including ministers of finance and other political decision-makers, governors of central banks, financial operators both within and outside of the banking sector, along with representatives of African diasporas and African researchers.
The influential participants are equal to the ambitious objective of the event: to provide the opportunity to share knowledge and experience on the theme of migrants' remittances to deal more effectively with the specific needs and expectations of the those populations. This includes those abroad who send funds to their home countries and those who receive them. The ultimate aim is to reduce the costs of remittances, which remain high, and to optimize their impact on the development of migrants' countries of origin. This objective has become all the more urgent in the context of the international crisis and the reduction in official development assistance.
Remittances, a resource to be tapped
The figures themselves make clear what is at stake: in 2012, no less than 406 billion US dollars was transferred by migrants around the world. The actual sum was certainly higher if we take into account informal transfers, still very significant in a large number of African countries. The threshold of 500 billion US dollars is expected to be reached in 2015. In the specific case of Africa, remittances of African migrants to their countries of origin exceeded 60 billion US dollars in 2012.
That is more than the total of 56 billion US dollars in official development assistance, and the 50 billion of foreign direct investment. Reducing the costs of remittances, and a better response to the expectations and needs of both senders and recipients: that is the issue.
Reducing the costs and benefiting development
It remains the case that, in Africa, the costs of remittances are the highest. On average they are higher than 11% of the amount sent, which is four percentage points higher than the world average. By way of comparison, these charges are around 6.5% in South Asia. This raises a question: how can the costs be reduced for remittances from African migrants to their respective countries of origin? Additionally, how can these financial flows be used to boost growth in the recipient countries and improve the socio-economic situation of the beneficiary populations?
The AfDB at the head of an action strategy
The AfDB is so concerned that, since 2007, it has been determined to create an integrated and pro-active strategy in this area. This pan-African seminar is also the result of activities underway since 2007, in cooperation with France and the French Development Agency. These included the publication, in 2011, of a study entitled Reducing the Costs of Migrants' Remittances and Optimising their Impact on Development: Financial Products and Tools for North Africa and the Franc Zone. This field study was conducted in France and five African countries: Morocco, Tunisia, the Comoros, Senegal and Cameroon. After identifying the characteristics of the market in each country, the study presents recommendations. It also suggests avenues to explore which could help to reduce the costs of remittances and optimize the impact of the financial flows that they create.
Following publication of the report, briefing workshops were held in each of the countries in the study. The final one, concerning Tunisia, was held at the country's Central Bank in June 2013.
The issues concerning remittances, both for the recipient countries and the countries of residence, are gradually attracting a growing interest. It is highly likely that this pan-African seminar marks a new stage in creating solutions that meet the expectations of the African diasporas and their communities of origin. In addition, it should promote cooperation that will benefit the countries of Africa and their development partners. These also represent the ambitions and resolutions of the international community, especially within the G20 framework.
