Remittance to Nigeria fell by 10 per cent in 2016, the latest edition of the Migration and Development Brief released at the weekend, National Daily has gathered.
The report which was unveiled on the sidelines of the ongoing International Monetary Fund/World Bank spring meetings in Washington DC, also showed that it was the second consecutive year remittance into the country would decline, a trend not seen in three decades.
The development was largely attributed to slow economic growth in remittance-sending countries; decline in commodity prices, especially oil, which impacted remittance receiving countries; and diversion of remittances to informal channels due to controlled exchange rate regimes in the country.
Generally, it revealed that remittance to Nigeria and other countries in Africa declined by an estimated 6.1 per cent to $33 billion in 2016. Similarly, remittance to other major receiving countries were also estimated to have fallen last year, including Bangladesh (-11.1 percent) and Egypt (-9.5 percent).
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India, while retaining its top spot as the world’s largest remittance recipient, led the decline with remittance inflows amounting to $62.7 billion last year, a decrease of 8.9 per cent over $68.9 billion in 2015.
The exceptions among major remittance recipients were Mexico and the Philippines, which saw inflows increasing by an estimated 8.8 percent and 4.9 percent, respectively, last year.
The Bank estimated that officially-recorded remittances to developing countries amounted to $429 billion in 2016, a decline of 2.4 per cent over $440 billion in 2015.
Global remittances, which include flows to high-income countries, contracted by 1.2 per cent to $575 billion in 2016, from $582 billion in 2015.
“Low oil prices and weak economic growth in the Gulf Cooperation Council (GCC) countries and the Russian Federation are taking a toll on remittance flows to South Asia and Central Asia, while weak growth in Europe has reduced flows to North Africa and Sub-Saharan Africa. The decline in remittances, when valued in U.S. dollars, was made worse by a weaker euro, British pound and Russian ruble against the U.S. dollar.
While the naira has been little changed at about 315 per dollar since August, non-deliverable forward contracts signal traders see the currency depreciating more than 10 percent in three months.