Dilip Ratha World Bank UN HLD New York October 2, 2013 Outlook for Migration and Remittances
Key messages Remittances expected to reach $414 bn by 2013 and $540 bn by 2016 Are remittance costs rising? Reduce the costs of recruitment, visa, passport and residency permits – a post-2015 development goal?
Remittances to developing countries to reach $414 bn in 2013 Source: Development Prospects Group, World Bank
Top remittance recipients in 2013 $ million, 2013e as % of GDP, 2012
Remittance flows to developing countries $ billion e 2014f2015f2016f Developing countries East Asia and Pacific Europe and Central Asia Latin America and Caribbean Middle-East and North Africa South Asia Sub-Saharan Africa Growth rate Developing countries 11.9%4.3% 6.3% 8.6%9.3%9.9% East Asia and Pacific 12.4%1.0% 7.4% 9.5%10.2%10.5% Europe and Central Asia 17.6%1.6% 10.8% 10.3%11.2%11.6% Latin America and Caribbean 6.1%0.9% 2.5% 10.5%11.1%11.6% Middle-East and North Africa 6.3%10.8% 3.6% 4.9%5.4%5.6% South Asia 18.4%9.7% 6.8% 7.7%8.5%9.4% Sub-Saharan Africa 4.5%-0.4%6.2%8.6%9.2%9.5%
Remittance growth is picking up in all regions Source: Development Prospect Group, the World Bank
But slower growth in Latin America and the Caribbean Source: Development Prospect Group, the World Bank
Double dip in Mexico *3-month moving averages
Double dip in Mexico…and US housing starts *3-month moving averages
In the US, employment is recovering faster for migrant workers than for natives* Source: Current Population Survey *3-month moving averages
Demand for skilled migrant workers is picking up in the US Number of Days to reach H1-B visa cap
Exchange rate changes encouraged remittances India Source: Internal Financial Statistics, IMF
Remittances are larger than foreign exchange reserves in at least 14 developing countries Source: IMF, World Bank staff estimates Remittances as a share of foreign exchange reserves (%)
The more diverse the migration destinations, the more resilient are remittances The lower the barrier to labor mobility, the stronger the link between remittances and economic cycles in that corridor Two observations
Registered Syrian Refugees Source: UNHCR based on available data from Egypt, Iraq, Jordan and Lebanon
Remittance price is falling, but not as much in low volume corridors where remittance is more important Cost of sending $200 Source: World Bank Remittance Prices Worldwide database
Remittance price is falling, but not as much in low volume corridors where remittance is more important Source: World Bank Remittance Prices Worldwide database Cost of sending $200 (%)
Remittance costs are still too high Cost of sending $200, %) Source: Remittance Prices Worldwide, World Bank.
Are remittance costs rising? Lifting fees Closing of MTO accounts by correspondent banks
Possible migration-specific goals for post agenda Reduce cost of making remittances Reduce the costs of migrating including recruitment, visa, passport cost and residency permits Mobilize additional sources of financing for development Protect the rights and safety of migrants
Recruitment costs can be a drain on migrants’ income Destination/Occupation Sending country Average recruitment cost In months of wages Domestic worker in Hong KongIndonesia $2, Philippines $1, Construction worker in Middle EastNepal $1, Bangladesh $2, Sources: ITUC, IMWU and HKCTU, June 2012; APL-HK and PLU, April 2013; Martin 2013, Human Rights Watch 2013, World Bank 2011 (Nepal report). These data should be viewed as preliminary.
Thank you