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Africa to lose US$11bn in remittances this year due to coronavirus – World Bank

• By EDMOND GYEBI
• April 24, 2020
• 0

Remittances to sub-Saharan Africa are projected to fall from US$48 billion last year to US$37 billion in 2020 – a drop of 23.1 per cent – because of the economic consequences of the COVID-19 pandemic, according to the World Bank.



It said that the continent would, however, register an expected recovery of four per cent next year.



The Bank explained: “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 US, 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 addition to the pandemic’s impact, many countries in the Eastern Africa region are experiencing a severe outbreak of desert locusts attacking crops and threatening the food supply for people in the region.”



It said global remittances would drop sharply from US$554 billion in 2019 to US$445 billion (19.7 per cent) this year, the biggest decline in recent history.



“The projected fall…is largely due to a fall in wages and employment of migrant workers who tend to be more vulnerable to loss of employment and wages during an economic crisis in a host country,” the Bank said.



Various studies have shown that remittances to lower- and middle-income countries help to reduce poverty.



World Bank President David Malpass said: “Remittances are a vital source of income for developing countries.


Source: GNA