The World Bank has projected that global remittance flow to West African countries such as Gambia are set to recover this year after two consecutive years of decline.
Remittances contribute 20% of the country’s Gross Domestic Product and according to a report released by International Fund for Agricultural Development (IFAD) in June 2017, Gambian migrants remitted home $181 million in 2016, despite the decline.
World Bank’s Migration and Development Brief report, released on October 3, stated the Sub-Saharan Africa’s economic outlook is expected to rebound in 2017 driven by the three largest regional economies: Nigeria, Senegal, and Ghana.
“The West African Monetary Union countries (Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal, and Togo) are expected to experience an upswing due to the appreciation of the euro against the U.S. dollar,” the report stated.
“The region’s major remittance-receiving countries are all projected to have remittance growth in 2017: Nigeria is expected to have 11.1 percent growth, Ghana 4.3 percent, and Kenya 4.1 percent. But, remittances also account for a significant share of GDP for some countries such as Liberia (26 percent), Comoros (21 percent), the Gambia (20 percent), Senegal (15 percent), Lesotho (15 percent), Cabo Verde (14 percent), and Togo (9 percent) (figure 4.6).”
Diaspora Remittance is money sent by a person in a foreign land to his or her home country.
Due to the huge sums involved in recent years such remittances are now being recognised as an important contributor to the home country’s growth and development.
Regardless of the importance of remittances to Gambia and other West African countries, the region records the highest remittance costs in the world.
However, recent months have seen a moderate decline in remittance costs from 9.4 percent in 2017 second quarter to 9.1 percent in 2017 third quarter, compared to global averages of 7.3 percent and 7.2 percent respectively.
The World Bank report stated: “Buoyed by improved economic activity in high-income OECD countries, remittances to Sub-Saharan Africa are projected to grow by a robust 10 percent to $38 billion this year.
“Remittances will grow by a moderate 3.8 percent to $39 billion in 2018,” the World Bank stated.
The bank estimates that officially recorded remittances to developing countries are expected to grow by 4.8 percent to $450 billion for 2017.
Global remittances, which include flows to high-income countries, are projected to grow by 3.9 percent to $596 billion.
The bank also expects modest growth in remittances to low and middle-income countries by 3.5 percent to $466 billion in 2018 and global remittances to grow by 3.4 percent to $616 billion in 2018.