Key Finance Updates
Remittances projected to shrink 14 per cent by 2021
The amount of money migrant workers send home is projected to decline 14 per cent by 2021 compared to the pre-COVID19 levels in 2019, according to the latest estimates published in the new World Bank’s Migration and Development Brief.
Remittance flows to low and middle-income countries (LMICs) are projected to fall by 7 per cent, to $508 billion in 2020, followed by a further decline of 7.5 per cent, to $470 billion in 2021. According to the report, international migration is set to fall in 2020 for the first time in recent decades.
The foremost factors driving the decline in remittances include weak economic growth and employment levels in the host countries of the migrants, weak oil prices, and depreciation of the currencies of remittance-source countries against the US dollar – all related to the negative economic impacts of the COVID-19 pandemic.
The declines in 2020 and 2021 will affect all regions, with remittances projected to shrink in Sub-Saharan Africa by 9 per cent and 6 per cent, respectively.
Remittance flows to LMICs touched a record high of $548 billion in 2019, larger than foreign direct investment flows ($534 billion) and overseas development assistance (about $166 billion). The gap between remittance flows and FDI is expected to widen further as FDI is expected to decline more sharply.
New report highlights trends in climate Finance
Climate Chance, an international association working to mobilize stakeholders in the fight against climate change, in partnership with Finance for Tomorrow, a Paris-based organisation aiming to make green and sustainable finance a key driving force in the development of the Paris Financial Centre, has released the 2020 Global Synthesis