Nepali migrant workers sent home $8.1 billion in the fiscal year 2018-19, making Nepal the 19th biggest beneficiary of funds sent by migrants around the world, according to a report released by World Bank today.
The remittances were up by 16.39 per cent year-on-year despite a drop in the number of departures of the workers. As a share of the gross domestic product (GDP) for the last fiscal year 2018-19, Nepal is among the top five recipient smaller economies, along with Tonga, Kyrgyz Republic, Tajikistan and Haiti.
Five South Asian countries are in the top 20 list of biggest beneficiaries of remittances, with Nepal taking the fourth spot in the region is behind India ($78.6 billion), Pakistan ($21 billion) and Bangladesh ($15.5 billion), but ahead of Sri Lanka ($7.5 billion) in terms of remittances, according to the World Bank’s Migration and Development Brief released today.
India is the world’s top recipient of remittances followed by China, Mexico, the Philippines and Egypt. The World Bank said that remittances to South Asia grew by 12 per cent to $131 billion in 2018, outpacing the 6 per cent growth in 2017. The report said that migrant workers and others sent home an estimated $529 billion to low- and middle-income countries last year, up by 9.6 per cent from the year before, which had also been a record. Such money transfers should hit $550 billion this year, making them the largest source of external finance, according to the bank.
Among the development goals set by the United Nations (UN) in 2015 was reducing the cost of remittances to 3 per cent. “However, banks on average were charging 11 per cent in the first quarter of 2019 while post offices charged 7 per cent,” it said, adding that many banks and money transfer operators charged too much, cutting into the gains of migration. “However, the factor making money transfer costs rise are banks’ efforts to avoid money-laundering and terrorism finance.”
“The high costs of money transfers reduce the benefits of migration,” the report’s lead author Dilip Ratha is quoted in a statement.
According to the central bank macroeconomic report of the last fiscal year 2018-19, Nepali migrant worker departures plunged due to a sharp decline in the number of people leaving for Malaysia – one of the most popular labour destinations for Nepalis – dragged down departure figures.
The World Bank report stated that migrant workers continue to be afflicted by recruitment malpractices including cheating by recruiters, who charged recruitment fees. Excessive charges borne by workers also led the Nepal government to halt worker departures to Malaysia in May 2018, the World Bank said.
Likewise, ministers from 12 Asian labour-sending countries – Afghanistan, Bangladesh, Cambodia, China, India, Indonesia, Nepal, Pakistan, the Philippines, Sri Lanka, Thailand, and Vietnam – met in Kathmandu last November in a high-level meeting of the sixth Ministerial Consultation on Overseas Employment and Contractual Labour for Countries of Origin in Asia (Colombo Process) and made a commitment of ‘zero-cost’ jobs for migrant workers. In the similar line, Nepal and Malaysia signed a memorandum of understanding (MoU) in October 2018 under which Malaysian employers would bear all necessary recruitment costs to hire Nepali workers, including visa and airplane tickets.
Likewise, Japan has identified nine priority countries as foreign labour sources on the heels of a new policy to admit 345,000 foreign workers over a period of five years starting April 11, 2019, the bank said, adding that except for Nepal, all the countries are in East Asia like Cambodia, China, Indonesia, Mongolia, Myanmar, the Philippines, Thailand and Vietnam. “Workers from these countries will be admitted into 14 sectors facing severe labour shortages.”
Both Nepal and the Philippines signed a memorandum of cooperation with Japan on March 25, 2019.
The remittances were up by 16.39 per cent year-on-year despite a drop in the number of departures of the workers. As a share of the gross domestic product (GDP) for the last fiscal year 2018-19, Nepal is among the top five recipient smaller economies, along with Tonga, Kyrgyz Republic, Tajikistan and Haiti.
Five South Asian countries are in the top 20 list of biggest beneficiaries of remittances, with Nepal taking the fourth spot in the region is behind India ($78.6 billion), Pakistan ($21 billion) and Bangladesh ($15.5 billion), but ahead of Sri Lanka ($7.5 billion) in terms of remittances, according to the World Bank’s Migration and Development Brief released today.
India is the world’s top recipient of remittances followed by China, Mexico, the Philippines and Egypt. The World Bank said that remittances to South Asia grew by 12 per cent to $131 billion in 2018, outpacing the 6 per cent growth in 2017. The report said that migrant workers and others sent home an estimated $529 billion to low- and middle-income countries last year, up by 9.6 per cent from the year before, which had also been a record. Such money transfers should hit $550 billion this year, making them the largest source of external finance, according to the bank.
Among the development goals set by the United Nations (UN) in 2015 was reducing the cost of remittances to 3 per cent. “However, banks on average were charging 11 per cent in the first quarter of 2019 while post offices charged 7 per cent,” it said, adding that many banks and money transfer operators charged too much, cutting into the gains of migration. “However, the factor making money transfer costs rise are banks’ efforts to avoid money-laundering and terrorism finance.”
“The high costs of money transfers reduce the benefits of migration,” the report’s lead author Dilip Ratha is quoted in a statement.
According to the central bank macroeconomic report of the last fiscal year 2018-19, Nepali migrant worker departures plunged due to a sharp decline in the number of people leaving for Malaysia – one of the most popular labour destinations for Nepalis – dragged down departure figures.
The World Bank report stated that migrant workers continue to be afflicted by recruitment malpractices including cheating by recruiters, who charged recruitment fees. Excessive charges borne by workers also led the Nepal government to halt worker departures to Malaysia in May 2018, the World Bank said.
Likewise, ministers from 12 Asian labour-sending countries – Afghanistan, Bangladesh, Cambodia, China, India, Indonesia, Nepal, Pakistan, the Philippines, Sri Lanka, Thailand, and Vietnam – met in Kathmandu last November in a high-level meeting of the sixth Ministerial Consultation on Overseas Employment and Contractual Labour for Countries of Origin in Asia (Colombo Process) and made a commitment of ‘zero-cost’ jobs for migrant workers. In the similar line, Nepal and Malaysia signed a memorandum of understanding (MoU) in October 2018 under which Malaysian employers would bear all necessary recruitment costs to hire Nepali workers, including visa and airplane tickets.
Likewise, Japan has identified nine priority countries as foreign labour sources on the heels of a new policy to admit 345,000 foreign workers over a period of five years starting April 11, 2019, the bank said, adding that except for Nepal, all the countries are in East Asia like Cambodia, China, Indonesia, Mongolia, Myanmar, the Philippines, Thailand and Vietnam. “Workers from these countries will be admitted into 14 sectors facing severe labour shortages.”
Both Nepal and the Philippines signed a memorandum of cooperation with Japan on March 25, 2019.
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