Defying concerns about remittances taking a hit from the pandemic, the growth of amounts sent by Nepali migrant workers abroad remains strong
KATHMANDU, Oct 31: Remittances inflow to Nepal is projected to decline to $7.39 billion in 2020 from $8.25 billion the country received from migrant workers abroad in 2019, according to the latest estimate by the World Bank.
The remittances growth is expected to slow down not only in Nepal, but almost all countries are going to see a decline in the amount they receive as transfers from their migrant workers abroad, the World Bank’s latest report said.
Releasing the Migration and Development Brief on Thursday, the World Bank said that the amount of money migrant workers send home is projected to decline 14 percent by 2021 compared to the pre COVID-19 levels in 2019 as the COVID-19 pandemic and economic crisis continue to spread.
The foremost factors driving the decline in remittances include weak economic growth and employment levels in migrant-hosting countries, weak oil prices and depreciation of the currencies of remittance-source countries against the US dollar, according to the World Bank’s brief.
The World Bank has also warned that the stock of international migrants is likely to decline for the first time in recent history as new migration has slowed and return migration has increased.
“Return migration has been reported in all parts of the world following the lifting of national lockdowns which left many migrant workers stranded in host countries,” reads the statement of the World Bank. “Rising unemployment in the face of tighter visa restrictions on migrants and refugees is likely to result in a further increase in return migration,” it added.
Despite concerns right from the beginning of the outbreak of the coronavirus that Nepal’s remittance income could be hit hard by the pandemic, the remittance inflow to the country has so far remained strong.
According to Nepal Rastra Bank, the remittance growth in most of the months has remained strong. Though it is difficult to compare the remittance figures that the NRB publishes based on the fiscal year, the overall trend of the last six months shows the pandemic is yet to have any significant impact on the remittance inflow.
For example, the remittances between mid-July and mid-September increased 8.1 percent to Rs 165.73 billion in 2020 compared to a decrease of 0.6 percent in the same period of the previous year.