SENDING MONEY HOME: Remittance flows to low- and middle-income countries (LMICs) are estimated to hit $656 billion in 2023 (up 1.5 per cen vs 2023), as economies of remittance source countries soften, according to the World Bank’s latest Migration and Development Brief released on Wednesday. The US continued to be the largest source of remittances. These are the top five remittance recipient countries in 2023:
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INDIA, $125 BILLION: India has consistently been one of the top recipients of remittances globally. According to World Bank data, India received over $90 billion in remittances in 2021, $111 billion in 2022, and $125 billion in 2023, making it the highest recipient country. The Indian diaspora, spread across the Middle East, North America, Europe, and other regions, sends money back to their families, helping to sustain local economies and foster development.
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MEXICO, $67 BILLION: The impact of remittances on the Mexican economy is far-reaching. Beyond individual households, these funds contribute significantly to local economies and regional development. Remittances can stimulate economic activity, create job opportunities, and support small businesses, particularly in rural areas where opportunities may be limited. A scene during the "Run Santa Run" Christmas race in Zapopan, Mexico.
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CHINA, $50 BILLION: Many Chinese nationals working abroad send remittances back to their families in China. These funds serve as a crucial source of financial support for families, covering expenses such as education, healthcare, housing, and daily living costs. Financial assistance from relatives working abroad do help improve living conditions and access to better opportunities. Remittances also boost domestic consumer spending, thereby contributing to the growth of the domestic economy.
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PHILIPPINES, $40 BILLION: Remittances form an economic lifeline in the south-east Asian country. They influence various aspects of the society – alleviating poverty, boosting domestic demand, enabling families to invest in better educational opportunities for their children, boosting housing and property development, and driving entrepreneurial activity. Remittances also bolster the country's foreign exchange reserves ($101.3 billion in November 2023), now one of the world’s highest, thus helping stabilise the Philippine peso and ensures a more robust and resilient economy.
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EGYPT, $24 BILLION: The reasons behind Egypt's increasing remittance inflow, estimated by the World Bank to hit $24 billion by end-2023 are multifaceted. A substantial Egyptian diaspora, particularly in the Gulf region and Europe, plays a pivotal role in sending money back home. Workers abroad, often driven by economic opportunities and employment prospects, contribute significantly to the country's remittance inflows. This influx of funds has a widespread impact, influencing consumer spending patterns, improving living standards, and fostering local development projects. A visitor looks out towards the city skyline at the Citadel of Saladin, in Cairo, Egypt.
Image Credit: Bloomberg
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