The World Bank on Friday said people working away from home sent less money back to developing countries in 2016 for the second consecutive year.
“Officially recorded remittances to developing countries fell 2.4 per cent in 2016 to 429 billion dollars.
“Following a decline in 2015, it was the first two-year drop in three decades’’, the World Bank said on the sidelines of spring joint meetings with the International Monetary Fund in Washington.
According to Rita Ramalho, Acting Director of the World Bank’s Global Indicators Group, remittances are an important source of income for millions of families in developing countries.
“As such, a weakening of remittance flows can have a serious impact on the ability of families to get health care, education or proper nutrition’’, Ramalho said.
Global remittances to all countries fell in 2016 by 1.2 per cent to 575 billion dollars, in a year when global growth was just 3.1 per cent.
The IMF this week forecast the world economy expanding by 3.5 per cent this year and 3.6 per cent in 2018.
“Low oil prices hurt the economies of Gulf countries and Russia, causing sharp remittance declines to South Asia and Central Asia.
“India, which leads the world in remittances received, saw flows decline by 8.9 per cent to 62.7 billion dollars last year’’, the World Bank estimated.
Other major recipient countries saw declines: Bangladesh (-11.1 per cent), Nigeria (-10 per cent), and Egypt (-9.5 per cent).
The Philippines saw an increase of 4.9 per cent and Mexico received 8.8 per cent more from workers outside the country.