India tops remittances in 2008, fall predicted in 2009: World BankMarch 25th, 2009 - 12:31 pm ICT by IANS
By Arun Kumar
Washington, March 25 (IANS) With migrant workers facing job losses, anti-migrant sentiment and even violence in the deepening global financial crisis, World Bank researchers predict remittances will fall to $290 billion in 2009, from last year’s high of $305 billion.
Remittances flowing to developing countries from Russia, South Africa, Malaysia and India are “especially vulnerable to the rolling economic crisis”, says the Bank’s revised Migration and Development Brief.
With a total of $45 billion, India was the top recipient of remittances in 2008. China came next with $34 billion followed by Mexico ($26 billion), Philippines ($18 billion) and Poland ($11 billion).
But even with a drop of between five and eight percent, remittances will still outstrip private capital flows, expected to fall by half in 2009, and official development aid, typically around $100 billion, the bank said.
Remittance flows will stay “resilient” because many countries have a well-established “stock” of migrants who are unlikely to leave their adopted countries.
They will continue to send money home, even if they have to reduce the amount they send, says economist Dilip Ratha, who leads the World Bank’s Migration and Remittances team.
Although newspapers are reporting a large number of migrants returning home, migrant workers are still moving to destination countries, although at a slower pace. They, too, will add to the flow of remittances, says Ratha.
Ratha’s team predicts remittances will amount to about 1.8 percent of GDP for developing countries in 2009, a slight drop from 1.9 percent of GDP in 2008.
However, considering that officially recorded remittances registered double-digit annual growth in the past few years, the expected fall will cause hardships in many poor countries, says the Bank’s Brief.
Ratha says employment of foreign-born workers in the US is holding steady in wholesale and retail and going up in the restaurant and hotel sector, though their employment in construction has fallen faster than that of native born workers, based on new US Bureau of Labour Statistics data.
“Migrant workers are more flexible. They are cheaper. They work harder and they don’t insist on all the right employment conditions. They don’t ask for too much. And I think there is an additional reason - a lot of workers that have dropped out of the payroll officially continue working off the books.”
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Tags: arun kumar, destination countries, developing countries, dilip ratha, economic crisis, economist, gdp, global financial crisis, hardships, job losses, march 25, migrant workers, migrants, migration, poor countries, private capital, remittances, sentiment, world bank, world bank researchers