Remittances to Low and Middle Income Countries in 2022 Up by 5% to $626 Billion — Latest World Bank Report

Remittances to Low and Middle Income Countries in 2022 Up by 5% to $626 Billion — Latest World Bank Report

Despite the headwinds which have dominated the 12 months, remittances to low and middle-income nations in 2022 nonetheless grew by 5% to $626 billion, the World Bank Migration and Development Brief has stated. Africa, the place the price of sending $200 averaged 7.8% in 2022, is the “most severely exposed to the concurrent crises.”

Impact of the Appreciating Ruble and Weaker Euro

According to the newest World Bank Migration and Development Brief (MDB), complete remittances to the so-called low and middle-income nations (LMICs) in 2022 went up by 5% to $626 billion. The enhance, which is decrease than the ten.2% seen in 2021, got here regardless of the worldwide headwinds which have characterised a lot of 2022, the report stated.

As per the brief, the components that contributed to the slower price of development within the U.S. greenback worth of remittances despatched to LMICs embrace the Russian forex’s appreciation, the weaker euro, in addition to the shortage of overseas forex in some nations.

Commenting on the report, Michal Rutkowski, a world director for social safety and jobs on the World Bank, stated:

Migrants assist to ease tight labor markets in host nations whereas supporting their households by way of remittances. Inclusive social safety insurance policies have helped employees climate the revenue and employment uncertainties created by the COVID-19 pandemic. Such insurance policies have international impacts by way of remittances and have to be continued.

Africa Most Exposed to ‘the Concurrent Crises’

Meanwhile, in accordance with the MDB, Africa is the area “most severely exposed to the concurrent crises.” To illustrate, the report notes that whereas remittances to Sub-Saharan Africa grew by 5.2% to $53 billion, this enhance is markedly decrease than the rise of 16.4% that was achieved in 2021. In phrases of the price of remitting funds, the temporary stated the price of sending $200 to the area is 7.8% which is the very best among the many six international areas lined by the research.

Concerning using digital channels when sending remittances, the report acknowledges that whereas the price of remitting funds through these channels is far decrease, a number of components nonetheless render them much less very best alternate options.

“Digital technologies allow for significantly faster and cheaper remittance services. However, the burden of compliance with Anti-Money Laundering/Combating the Financing of Terrorism regulations continues to restrict access of new service providers to correspondent banks. These regulations also affect migrants’ access to digital remittance services,” the MDB famous.

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