Sunday, April 20, 2014

Third highest remittance inflows (% of GDP) to Nepal in 2012

According to the latest Migration and Development Brief No.22, official remittance inflows to Nepal reached 24.7% of GDP in 2012, which makes Nepal the third largest remittance recipient in the world. Migrants remitted an estimated US$5.2 billion to Nepal in 2013 (equivalent to about 25% of GDP). The amount of remittance outflows was just US$50.3 million in 2012.


The average growth of remittance inflows over the last five years has been around 14%, boosted by both the increased number of migrant workers leaving the country and the higher incentives to send more money back home as a result of the depreciation of Nepali rupee against major convertible currencies. Increased remittance inflows are greatly boosting banking sector liquidity in FY2014, leading to a situation where BFIs are increasingly investing in near zero interest bearing T-bills in the absence of good investment projects. More on remittances in Nepal here and here.

Top remittance recipients

As a share of GDP in 2012, the top five remittance recipients were Tajikistan (51.9%), Kyrgyz Republic (31.4%), Nepal (24.7%), Moldova (24.6%) and Samoa (23.5%). In 2010, Nepal was the sixth highest remittance recipient in the world.

In US$ term, India received $70 billion in 2013, followed by China ($60 billion), the Philippines ($25 billion), Mexico ($22 billion) and Nigeria ($21 billion).

In South Asia, while India received the highest amount of remittances, Nepal was the highest recipient as a share of its GDP. As a share of total remittance inflows to South Asia, India receives about 63.2% and Nepal 4.7%.

Remittance inflows
2013e (US$ million)
Share of GDP, 2012
Nepal
     5,210
24.7
Bangladesh
    13,776
12.2
Sri Lanka
     6,690
10.1
Pakistan
    14,626
6.1
India
    69,969
3.7
Bhutan
          19
1.0
Maldives
            3
0.1
Afghanistan
        385
..

Outlook
  • The WB estimates remittance inflows to development countries at $404 billion in 2013, up 3.5% from 2012. It is expected to grow by an annual average of 8.4%, increasing total remittance inflow to developing countries to $436 billion, $473 billion and $516 billion in 2014, 2015 and 2016, respectively.
  • South Asia is expected to see remittances growth of 6.6%, 7.3%, and 7.5% in 2014, 2015 and 2016, respectively, increasing remittance inflows to $118 billion, 127 billion and 136 billion over the same time periods.

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