At a Glance:
- Remittances to developing countries are estimated to have reached $372 billion in 2011, an increase of 12% over the previous year, according to figures contained in the latest issue of the World Bank’s Migration and Development Brief.
- Global remittance flows, including those to high-income countries, were an estimated $501 billion in 2011.
- The top recipients of officially recorded remittances in 2011 were India ($64 billion), China ($62 billion), Mexico ($24 billion), and the Philippines ($23 billion). Other large recipients included Egypt, Pakistan, Bangladesh, Nigeria, Vietnam, and Lebanon. However, as a share of GDP, remittances are largest in smaller and lower income countries: top recipients include Tajikistan (31%), Lesotho (29%), Samoa (23%), Kyrgyz Republic (21%), and Nepal and Tonga (20% each).
- Remittances sent home by migrants to developing countries are three times the size of official development assistance and can have profound implications for development and human welfare. Remittances can contribute to lower poverty and to the building up of human and financial capital for the poor.
- Despite the current global economic weakness, remittance flows are expected to continue growing, with global remittances expected to reach $615 billion by 2014, of which $467 billion will flow to developing countries.
- Although remittance costs have fallen steadily in recent years, they remain high, especially in Africa and in small nations where remittances provide a lifeline to the poor. Reducing the cost of remittance transfers produces significant benefits to migrants and their families and to receiving countries more broadly as the steady stream of foreign currency improves a country's creditworthiness for external borrowing.
- The World Bank has made considerable strides in developing financing instruments for leveraging migration and remittances for national development purposes. Diaspora bonds can be a powerful financial instrument for mobilizing diaspora savings to finance specific public and private sector projects, as well as to help improve the debt profile of the destination country. The World Bank has established a Task Force on the Implementation of Diaspora Bonds to facilitate the provision of technical assistance to developing country governments. The Task Force is providing technical assistance to several countries.
- International migration – the movement of people across international boundaries – has enormous implications for growth and welfare in both origin and destination countries.
- According to the United Nations, more than 215 million people live outside their countries of birth, and over 700 million migrate within their countries. In the coming decades, demographic forces, globalization and climate change will increase migration pressures both within and across borders.
- International migration boosts world incomes. By allowing workers to move to where they are more productive, migration results in an increase in aggregate output and income.
- There is a pressing need to improve data on remittances at the national and bilateral corridor level.
- Remittances generally reduce the level and severity of poverty and frequently lead to: higher human capital accumulation; larger health and education expenditures; greater access to information and communication technologies; improved formal financial sector access, small business investment, and entrepreneurship; reduced child labor and help households to be better prepared for adverse shocks such as droughts, earthquakes, and cyclones.
- Diasporas can be an important source of trade, capital, technology, and knowledge for origin countries.
World Bank Initiatives
Key World Bank initiatives and research programs on migration and remittances include:
- The Global Knowledge Partnership on Migration and Development (KNOMAD), a global public good aimed at facilitating multidisciplinary debate and discussion on migration issues, developing policy options, and assisting sending and receiving countries implement pilot policies. KNOMAD is currently in the inception phase, with funding from the Swiss Agency for Development and Cooperation (SDC).
- Assisting countries in improving the collection of data on migration and remittance flows. The Bank publishes a comprehensive dataset on annual remittances data (inflows and outflows), monthly remittances data to selected countries, and estimates of bilateral migration and medical ‘brain drain’ for over 200 countries.
- Identifying migration policies, regulations, and institutional reforms in both receiving and sending countries that will lead to superior development outcomes.
- Improving existing remittances data, strengthening the links between remittances and financial access of migrants and remittance recipients, and enhancing the integrity of money transfer systems.
- Advocating the need for reducing remittance costs, in collaboration with the G20. The Bank monitors remittance prices for 200 major remittance corridors via the World Bank Remittance Price Database (http://remittanceprices.worldbank.org).
The Bank publishes a ‘Migration and Remittances Factbook’, which provides a snapshot of migration, skilled migration and remittances, and socio-economic characteristics for all countries, regions and income groups. The latest edition of the Factbook was issued in December 2011. A more frequent Migration and Development Brief is published at least twice annually. The latest issue of the Brief was issued in April 2012.
During 2011, the World Bank issued several books related to migration, including Migration and Remittances during the Global Financial Crisis and Beyond, Leveraging Migration for Africa: Remittances, Skills, Investments and two companion volumes on Diaspora for Development of Africa and Remittance Markets in Africa.
The World Bank is closely involved in global partnerships to develop policy coherence on the treatment of migration. Recent collaborations include:
- Since July 2008, the Bank has been leading and coordinating a Global Remittances Working Group (GWRG), formed at the request of the G8 countries. The GRWG has set a goal of reducing the cost of remittances by five percentage points in five years. The GRWG also addresses the issue of improving migration and remittances data, promotion of financial inclusion via remittances, and analysis of development impacts of migration and remittances.
- The Bank is a member of the Global Migration Group, and it actively contributes to the Global Forum on Migration and Development.
To learn more about the World Bank’s work on migration, visit www.worldbank.org/migration or http://blogs.worldbank.org/peoplemove
Merrell J. Tuck-Primdahl, 202-473-9516, email@example.com
Indira Chand, 202-458-0434 , firstname.lastname@example.org
Updated September 2012