1 / 25

REMITTANCES

REMITTANCES . Summary. Trends Senders and Receivers Problems with Transfer System Potential of Remittances Problems of Remittances. Remittance. A transfer of money by a foreign worker to his home country.

adora
Télécharger la présentation

REMITTANCES

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. REMITTANCES

  2. Summary • Trends • Senders and Receivers • Problems with Transfer System • Potential of Remittances • Problems of Remittances

  3. Remittance • A transfer of money by a foreign worker to his home country. • Money sent home by migrants constitutes the second largest financial inflow to many developing countries.

  4. Types of remittances: • Family remittances - This is money sent by individual immigrants to family and friends back home. • Community remittances - This is money sent by individual immigrants and by hometown associations to communities in their home country.

  5. Remittances: • Can help to reduce poverty • Help smooth household consumption • Lead to increase household expenditures

  6. Source: www.sela.org

  7. Source: www.sela.org

  8. Top 10 Recipients 2007 Source: World Bank Migration and Remittances Factbook 2008

  9. Top 10 Recipients 2006 Source: World Bank Migration and Remittances Factbook 2008

  10. Trends • Remittances began to slow down in the third quarter of 2008. • This slowdown is expected to deepen further in 2009 in response to the global financial crisis.

  11. 2006-2008 • Florida 73% - 50% • Georgia 85% - 53% • Utah & New Mexico 57% -31% • North Carolina & Virginia 88% - 59%

  12. Remittance Flows to Developing Countries, 2002-2008 www.worldbank.org

  13. Senders According to the Pew Hispanic Center: • 60% of U.S remittance senders are male. • 47% of all Hispanics born outside the U.S regularly send money to their country of origin. • About 64% of remittance senders have less expectations of permanently staying in the foreign country.

  14. 2004 IDB Study • 60% of 16.5 million sent estimated $30 billion during 2004 • Sent approximately 10% of household income • “Traditional sending” states: • New York, California, Texas, Florida, Illinois, New Jersey

  15. Receivers • Two–thirds of all recipients of foreign remittances are women. • Remittance money received is normally spent on necessities. • Remittances 50-80% of household income.

  16. Problems with Transfer System • Formal vs. Informal Channels • Cost of Transfer • Inadequate Financial Infrastructure

  17. Formal vs. Informal Channels • Formal • Banks • Money Transfer Operators • Informal • Mail • Friends • Self

  18. Cost of Transfer • 15-20% of total • MTOs charge more for smaller amounts • Other fees • Currency conversion fees • Expedite fees • Recipient fees

  19. Financial Infrastructure • Financial institutions lacking in rural areas • Smaller institutions fill market • Financial education needed

  20. More stable than capital flows Some countries use remittance flows as guarantees to obtain loans Two types: Family remittances Collective/community remittances Potential of Remittances

  21. Source: www.sela.org

  22. Government Intervention? • Governments want to harness the potential of remittances. • Can teach recipients about the potential of remittances. • Ultimately, remittances are private.

  23. Problems of Remittances • “Ghost-town” phenomenon • “Easy money” • Inequality

  24. Conclusion • Long-run effects of remittances inconclusive • Short-term effects vary from country to country • Remittance flows might decrease as migrants return to country of origin

More Related