Migration and Remittances

At a Glance:

·         More than 215 million people live outside their countries of birth, and over 700 million migrate within their countries.

·         Remittances sent home by migrants accounted for 2 percent of GDP for all developing countries in 2008, but 6 percent of GDP for low-income countries in particular. In several small low-income countries, remittances exceed a fifth of GDP and provide the largest source of foreign exchange.

·         Remittances sent home by migrants to developing countries are three times the size of official development assistance and represent a lifeline for the poor. In 2010, remittances recovered to the 2008 level of $325 billion after having dropped to $307 billion in 2009 as a result of the global financial crisis. Flows are projected to rise to $346 billion in 2011 and $374 billion by 2012.

·         Remittances generally reduce the level and severity of poverty. They frequently lead to higher human capital accumulation, higher health and education expenditures and access to information and communication technologies, more involvement in private enterprise; reduce child labor; and help households be better prepared for natural disasters.

·         Governments should treat remittances like private transactions and not as a substitute for debt or aid flows.

·         Diasporas can be an important source of trade, capital, technology, and knowledge for origin countries.

Their savings and wealth can be leveraged for development projects through diaspora bonds and remittance-backed bonds. 

World Bank Initiatives related to Migration and Remittances

Although migration has received limited policy attention in the past, compared to international trade and capital flows, the World Bank has successfully advocated that well-designed policies based on rigorous analysis and knowledge can improve the developmental impact of migration and remittances. The Bank’s initiatives and research programs on migration and remittances primarily focus on:

·         The impact of migration and remittances on economic growth and country creditworthiness, the determinants of migration, ‘brain drain,’ temporary movements of people, the link between trade, foreign direct investment (FDI) and migration, social protection and governance.

·         Identifying migration policies, regulations, and institutional reforms in both receiving and sending countries that will lead to superior development outcomes.

·         The gender dimensions of migration and diaspora resources.

·         Improving existing remittance data, reducing transaction costs, strengthening the links between remittances and financial access of migrants and remittance recipients, and enhancing the integrity of money transfer systems.

The World Bank publishes a comprehensive dataset on remittances flows across the world,  as well as monthly remittances data for 22 countries and remittance prices for 200 remittances corridors (from 29 major remittance sending countries to 86 receiving countries). Bank efforts to improve migration data include developing the most comprehensive database on skilled migration to date, based on census and survey data from the Organization for Economic Co-operation Development (OECD) countries and—in collaboration with the United Nations Population Division—a bilateral matrix of global migration stocks, including South-South migration and various extensions along gender and age-of-migration dimensions.

The World Bank is closely involved in global partnerships to develop policy coherence on the treatment of migration and remittances. Recent collaborations include:

·         Co-chairing (with the Bank for International Settlements) a taskforce for international coordination of remittance payment systems.

·         Leading and coordinating a Global Remittances Working Group formed at the request of the G-8 countries. The GRWG has set a goal of reducing the cost of remittances by five percentage points in five years.

·         Providing technical inputs to the G-20's Study Group on Labor Mobility and Demographics and contributing to a paper for the G-20 meeting in September 2009 on remittances. 

·         Participating in the meetings of the Global Forum on Migration and Development held in Brussels (2007), Manila (2008), and Athens (2009). The Bank also took part in a Global Forum on Migration in Puerto Vallarta, Mexico in November 8-11, 2010.

·         Supporting the work of the G-20 on inclusive growth, which includes remittances as a key area.

·          Participating in the Global Migration Group.

The World Bank has undertaken economic and sector work on migration and remittances in all key developing regions, including:

·         Migration and remittances analyses have been included in country assistance strategies for Albania, Bangladesh, Moldova, Nepal, the Philippines, South Africa, and Tajikistan, among others. Securitization of remittances have been sent to El Salvador.

·         The African Diaspora Program (ADP) is assisting the African Union Commission to create an African Institute for Remittances (AIR).

·         The Migration and Remittances Peer-Assisted Learning (MIRPAL) Network, in Europe and Central Asia facilitate exchange of information between practitioners.

·         Two major regional studies of cross-border labor mobility, remittances and development in East Asia and Pacific and in South Asia.

·         A major study of migration in Africa, together with the African Development Bank. Six household surveys in Burkina Faso, Kenya, Nigeria, Uganda, Senegal and South Africa were conducted and are available publicly, along with two companion volumes on remittance markets and diaspora.

The Bank held consultations on remittances and diaspora bonds on the sidelines of the spring meetings in April 2011. The World Bank is supporting a research consortium “Migrating out of Poverty” with several universities in Africa, Asia and Europe. The Bank’s PeopleMove blog is a widely-read blog on migration and development. An online Migration and Development brief series examines current themes of interest.

To learn more about the World Bank’s work on migration, visit www.worldbank.org/migration or http://blogs.worldbank.org/peoplemove For key publications on migration visit http://go.worldbank.org/BFVS46T5G0 

Media Contacts:

Merrell J. Tuck-Primdahl , 202-473-9516, mtuckprimdahl@worldbank.org

Vamsee Kanchi, 202-458-9771, vkanchi@worldbank.org

Updated July 2011