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Friday, October 30, 2020

World Bank predicts 23% drop in remittances to sub

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By Yinka Kolawole

The World Bank has projected a sharp decline of 23.1 percent in  remittances to sub-Saharan Africa in 2020 due to the coronavirus (COVID-19) pandemic, more than the 20 percent drop predicted globally.

In a press release by the bank, it predicted that remittances to the region will decrease to $37 billion from $48 billion, representing about 23 percent drop. The bank attributed the possible decline to  a combination of factors driven by the coronavirus outbreak in key destinations where African migrants reside.

The World Bank stated: “Remittances to  sub-Saharan Africa  registered a small decline of 0.5 percent to $48 billion in 2019. Due to the COVID-19 crisis, remittance flows to the region are expected to decline by 23.1 percent to reach $37 billion in 2020, while a recovery of 4 percent is expected in 2021.

“The anticipated decline can be attributed to a combination of factors driven by the coronavirus outbreak in key destinations where African migrants reside including in the EU area, the United States, the Middle East, and China. These large economies host a large share of Sub-Saharan African migrants and combined, are a source of close to a quarter of total remittances sent to the region.”

In his remark, World Bank President, David Malpass stated:  “Remittances are a vital source of income for developing countries. The ongoing economic recession caused by COVID-19 is taking a severe toll on the ability to send money home and makes it all the more vital that we shorten the time to recovery for advanced economies.  Remittances help families afford food, healthcare, and basic needs. As the World Bank Group implements fast, broad action to support countries, we are working to keep remittance channels open and safeguard the poorest communities’ access to these most basic needs.”

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