This file photo taken on October 18, 2016 shows workers walking through the construction site of the world-biggest start-up incubator Station F, formerly known as the Halle Freyssinet in Paris (AFP / Lionel Bonav)
London: Migrants working in rich countries sent home almost half a trillion dollars in 2016, helping to lift families out of poverty by providing financial stability, access to education, housing and healthcare, according to a global report.
About 200 million migrants, half of whom are women, sent $445bn to their families in Asia, Latin America and Africa in 2016, the International Fund for Agricultural Development (IFAD) said yesterday.
The total amount of remittances, which is estimated to reach $450bn in 2017, has risen by more than 50 percent in the past decade, IFAD said.
“It is a truly a global phenomenon in which people, due to lack of opportunities, have to leave their families behind to provide for them,” said Pedro De Vasconcelos, IFAD policy advisor and author of the report.
“Migration should be an option, a choice. But for 200 million people, it’s a necessity,” he said.
Most remittances ($117bn) came from the United States, followed by Europe ($115bn) and the Gulf states ($100bn).Total migrant worker earnings are estimated to be $3 trillion annually, of which approximately 85 percent remains in the host countries. The money migrants send home averages less than one percent of their host country’s gross domestic product, IFAD said.
The report said families back home receive an average of $200 a month, which makes up 60 percent of the household income.
Using the steady flow of remittances, families can buy food, get housing, go to school, access healthcare, improve sanitation, or even invest in a business and have some savings.
De Vasconcelos said relying on remittances is a symptom of poverty in developing nations that pushes people to find economic opportunities abroad.
He said helping families use the money more productively could help reduce poverty, and in turn, prevent people from migrating in the first place.
“Remittances are a symptom, but they can be used to have a long-term positive effect in the economies where these funds are going,” he said.
Ways to maximise remittances include getting private companies to reduce money transfer fees to poor remote areas, providing financial literacy to families, or promoting climate insurance to those in rural areas so they can cope better with natural disasters, the report said.
