A recent World Bank report says remittance flows to developing countries are projected to exceed US$406 billion this year. This would be an increase of 6.5 per cent over the total in 2011. The report also projects remittances to developing countries to increase by 7.9 per cent in 2013, 10.1 per cent in 2014, and 10.7 per cent in 2015 when it will get to US$534 billion.
These figures are likely to be underestimates because they do not capture unrecorded flows through formal and informal channels. The World Bank believes that if all flows were tabulated they would be far larger than amounts indicated by the available remittance data.
Remittances are an important global financial transfer from rich countries to developing nations. More than 215 million people, approximately three per cent of the world's population, live in a country other than their country of birth. The money sent to their country of origin, known as remittances, amount to three times the development assistance from developed countries to developing countries.
Apart from the impressive magnitude of remittances, these flows have been remarkably resilient compared to private capital flows in the midst of an unprecedented global financial crisis. What this means is that even if the host country's economy suffers a recession, migrants send money either from current income or from their savings. Indeed, when there is an economic crisis or natural disaster in their home country, migrants dig deeper and send even more in remittances.
In addition to being an important flow of foreign exchange to developing countries, remittances are vital because they percolate through to the poorest households and support educational, health, and religious institutions. Remittances also perform the role of social security in developing countries and are a source of investment as they are used to purchase land, fund the construction of homes, and finance business ventures.
The top recipients of remittances in 2012 are India ($70 billion), China ($66 billion), The Philippines ($24 billion), Mexico ($24 billion), and Nigeria ($21 billion). Some developing countries depend heavily on remittances as a percentage of GDP, the top beneficiaries being Tajikistan (47 per cent), Liberia (31 per cent), Lesotho (27 per cent), Moldova (23 per cent), Nepal (22 per cent) and Samoa (21 per cent).
Over US$43 billion was remitted to the English-speaking Caribbean between 1970 and 2009, averaging just over US$1 billion annually. Since 1980, the top two recipient countries are Jamaica and Haiti, accounting for almost 80 per cent of total remittances to the region. Jamaica is the leading country, averaging 51 per cent of total flows annually, with Haiti 28 per cent.
Jamaica's remittances come primarily from the United States which accounts for 58 per cent of total annual inflow of remittances, with the United Kingdom and Canada accounting for 17.4 per cent and 10.2 per cent respectively. The remittances in Jamaica are the equivalent of 15.9 per cent of GDP and that translates into US$708 for each Jamaican.
There are, therefore, many Jamaicans here who are living on the charity of Jamaicans overseas. Given that harsh reality, we would not be surprised at a revival of the lobby to allow Jamaicans living overseas the right to vote in our elections.