Global recession is taking its toll on remittances to developing
countries, indicates a study by the World Bank (WB), which
forecasts that flows will total $304 billion in 2009, down 7.3
percent compared with an estimated $328 billion in 2008.
The forecast is a revision of an earlier WB estimate of a 5 percent
fall and comes after growth of 14.8 percent in 2008 and 25.2
percent in 2007.
Among major remittance recipients hardest hit is Mexico, which
began feeling the impact of the US’ economic woes in late-2008.
According to the WB remittances to Mexico fell 11 percent in the
first half of 2009 compared with the same period in 2008.
Remittances to Latin America overall are also under pressure, with
the WB forecasting an average decline in 2009 of 6.9 percent across
Good news in an otherwise bleak situation is that flows to some
South and East Asia (SEA) countries continue to increase, though at
a slower pace than in 2008. For example, growth in remittances into
the Philippines slowed from 14 percent in 2008 to 8 percent in the
first half of 2009.
The WB attributes the continued increase in flows to SEA in part to
the fact that the Middle East oil producing region, a major
destination for Asian migrants, has not significantly reduced
Assessing prospects for the global remittance market the WB noted
that it anticipates “a possible recovery in 2010 and 2011.” For
2010 the WB’s base-case forecast is for growth of 2.9