Despite the perceived slowdown in diaspora remittances to Nigeria, a total of $19.2 billion arrived in the country in 2021, the highest in sub-Saharan Africa (SSA) according to the World Bank’s report on migration and development released this weekend.
In fact, the figure was up 11.2% from the $17.2 billion recorded in 2020.
Against the backdrop of the country’s apex bank overprotecting its currency, the report said the stability of the naira and the $4 naira policy helped attract inflows.
The SSA jumped 14.1% to $49 billion.
According to the World Bank note, “Remittances to Africa have maintained a strong secular upward trend, within a few years, growing by an average of 11 percent per year over the period 2004–21. However, remittances never proved to be dominant among external financial flows for the region, eclipsed by ODA during the period (of around $9 billion in 2021) and robust FDI inflows. , but quite volatile, largely directed towards resource-rich economies (the surge in FDI in 2021 reflects a mega M&A deal in South Africa).
Portfolio investment inflows have always been volatile, given the region’s debt difficulties; and portfolio flows have now been affected by the onset of the Russian-Ukrainian crisis.
Commenting on the cost of remittances, Dilip Ratha, lead author of the Migration and Remittances report, said: “Reducing remittance fees by 2 percentage points would potentially result in $12 billion in annual savings for international migrants from LMICs and $400 million for migrants. and refugees from Ukraine