Families back home rely heavily on the money sent by immigrants. 577 billion euros were sent in 2021 to low- and middle-income countries, according to figures published by the International Fund for Agricultural Development (IFAD). And this despite forecasts that the Covid-19 pandemic would reduce these shipments.
The health restrictions, including border closures, have forced overseas workers to use their mobile phones for money transfers. An increase of 48% in 2021, specify the authors of the report.
Admittedly, cash still holds the upper hand, but mobile sending is now on the rise. Africa alone received 90 billion euros. Transfers that cost more than elsewhere. Commissions applied by remittance companies can be as high as 7.8% in Africa, while the global average of commissions applied by remittance companies is 6%. If this rate reached 3%, as provided for by the UN’s Sustainable Development Goals (SDGs), this would represent nearly 4.6 billion euros in additional income for the families of African emigrants.
A lifeline
Half of the money sent goes to rural areas. A lifeline for millions of families. This money allows them to feed themselves, to pay the children’s school fees or to cover health expenses.
Remittances to the Europe-Central Asia region reached 70 billion euros. But the war in Ukraine could lead to a sharp drop in these sums, which represent a vital source of financing and growth, particularly for the countries of Central Asia.
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