Cash flows into Barbados from relatives in the diaspora appear to have remained steady over the past year, reaching around $432 million (US$216 million), according to the latest World Bank data.
This, as the Washington-based international financial institution, indicated that remittances to low and middle-income countries were projected to have grown a strong 7.3 per cent to reach $1.198 trillion (US$589 billion) this year.
This is higher than earlier World Bank forecast that remittance to low- and middle-income countries would rebound by about 5.6 per cent this year to reach $940 billion (US$470 million).
“This return to growth is more robust than earlier estimates and follows the resilience of flows in 2020 when remittances declined by only 1.7 per cent despite a severe global recession due to COVID-19,” according to estimates from the World Bank’s Migration and Development Brief released on Wednesday.
In the Caribbean, Jamaica continues to lead when it comes to remittance inflows, increasing to $7 billion (US$3.5 billion) this year, up from almost $6.2 billion (US$3.1 billion) a year prior.
Remittance inflows to Haiti were estimated at about $6.2 billion (US$3.1 billion) this year, Guyana $786 million (US$393 million), Trinidad and Tobago $356 million (US$178 million), Suriname $340 million (US$170 million), and Grenada $96 million (US$48 million).
World Bank Global Director for Social Protection and Jobs Michal Rutkowski said remittances should be seen as a key component of government policies to support recovery from the COVID-19 pandemic.
“Remittance flows from migrants have greatly complemented government cash transfer programmes to support families suffering economic hardships during the COVID-19 crisis. Facilitating the flow of remittances to provide relief to strained household budgets should be a key component of government policies to support a global recovery from the pandemic,” said Rutkowski.
For a second consecutive year, remittance flows to low and middle-income countries (excluding China) were expected to surpass the sum of foreign direct investment (FDI) and overseas development assistance (ODA), the World Bank said.
“This underscores the importance of remittances in providing a critical lifeline by supporting household spending on essential items such as food, health, and education during periods of economic hardship in migrants’ countries of origin,” it said.
A World Bank report, 360 Degrees Resilience: A Guide to Prepare the Caribbean for a New Generation of Shocks, which was released on Wednesday, noted that Caribbean countries have a large diaspora and rely heavily on remittances.
Remittances to Barbados averaged just about three per cent of gross domestic product (GDP) between 1990 and 2019, the report said.
According to the World Bank’s regional remittance trends, remittance flows into Latin America and the Caribbean will likely reach a new high of $252 billion (US$126 billion) this year, registering a solid advance of 21.6 per cent compared to 2020.
“The value of remittances as a share of GDP exceeds 20 per cent for several smaller economies: El Salvador (26.2 per cent), Honduras (26.6 per cent), Jamaica, (23.6 per cent), and Guatemala (18 per cent),” it pointed out.
The release also pointed to remittance cost, stating that sending US$200 to the region cost 5.5 per cent on average in the first quarter of 2021, down from six per cent a year earlier.
It said: “Mexico remained the least expensive recipient country in the G20 group, with costs averaging 3.7 per cent. But remittance costs are exorbitant in smaller corridors”.
Mexico, the region’s largest remittance recipient, received 42 per cent ($52.7 billion) of the regional total, the World Bank said. marlonmadden@barbadostoday.bb
