The World Bank has urged Nigeria and other countries with significant remittance from the diaspora to leverage it to fight poverty and finance other needs in the country.
In its latest Migration and Development Brief, which indicated that the diaspora inflow to Nigeria stood at $19.5bn, lower than the projected N20bn.
He, however, stated that it was the highest in the sub-Saharan African region at 35 per cent and that the decline in remittances was felt in other regions as well.
However, despite the slowdown, remittances still outpaced Foreign Direct Investment and Official Development Assistant, a trend that the bank would widen in coming years due to migration pressures driven by demographic trends, income gaps, and climate change.
“This is not to suggest that remittances could substitute for FDI or ODA. Developing countries need FDI, especially in critical infrastructure and green investments. They also need ODA to address public financing needs and externalities such as fragility and climate change. Instead, countries need to take note of the size and resilience of remittances and find ways to leverage these flows for poverty reduction, financing health and education, financial inclusion of households, and improving access to capital markets for state and non-state enterprises,” the Punch newspaper report on Monday quoted the World Bank report as saying.
The report added that in terms of cost, the Sub-Saharan Africa has the highest remittance cost with an average of 7.9 per cent compared to other regions.
According to the World Bank, these remittance costs include payments such as bank charges, money transfer operator’s percentage as well as stamp duties, among others.
The report added that the fees charged to senders (and sometimes recipients) were often masked by nontransparent foreign exchange markups.
GIK/APA
W/Bank urges Nigeria to use diaspora remittances to eradicate poverty
