World Bank.2012 2014 Outlook for Migration and Remittances

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World Bank.2012 2014 Outlook for Migration and Remittances

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World Bank.2012 2014 Outlook for Migration and Remittances

  1. 1. Outlook for migration and remittances2012-14Dilip RathaWorld BankTenth Coordination Meeting on International MigrationNew YorkFebruary 9, 2012
  2. 2. After a modest decline in 2009, remittanceshave grown steadily, to reach $351 bn. in 2011 $ billions 600 500 400 300 200 100 0 90 92 94 96 98 00 02 04 06 08 10 f f 12 14 19 19 19 20 20 20 20 20 19 19 20 20 20 Source: Migration and Development Brief 17
  3. 3. Resilience of remittances across all regions Percent 40% East Asia and Pacific 20% Europe and Central Asia* Latin America and Caribbean 0% Middle-East and North Africa South Asia -20% Sub-Saharan Africa f f e 08 09 10 12 13 11 20 20 20 20 20 20 Source: Migration and Development Brief 17
  4. 4. Remittance flows to developing countries$ billion 2010 2011e 2012f 2013f 2014fDeveloping countries 325 351 377 406 441 East Asia and Pacific 94 101 109 117 127 Europe and Central Asia 36 40 44 48 53 Latin America and Caribbean 57 61 66 71 77 Middle-East and North Africa 35 36 37 39 42 South Asia 82 90 97 105 114 Sub-Saharan Africa 21 23 24 26 28 Growth rate (%) Developing countries 6.0% 8.0% 7.3% 7.9% 8.4% East Asia and Pacific 10.2% 7.6% 7.3% 8.0% 8.7% Europe and Central Asia -0.1% 11.0% 8.8% 10.1% 11.4% Latin America and Caribbean 1.2% 7.0% 7.6% 7.9% 8.1% Middle-East and North Africa 3.3% 2.6% 5.0% 5.3% 5.5% South Asia 9.5% 10.1% 7.4% 7.9% 8.4% Sub-Saharan Africa 4.5% 7.4% 6.3% 6.8% 7.3%
  5. 5. Outlook for remittances Remittances to developing countries $351 bn. In 2011 (8% increase over 2010) Growth in all six developing regions in 2011 after global financial crisis (MENA, LAC slower growth) Forecasts: 7-8 percent growth in 2012-14 Economic crisis in Europe, high unemployment rates and restrictive immigration policies are affecting migration and remittances Gulf countries and oil exporters (Russia) are providing a cushion for remittances to Asia
  6. 6. 0 10 20 30 40 50 60 In di Ch a i M na 58 57Ph e x i li ic o pp P a in e 24 23B a k is s n g ta la n de N i sh ge V i r ia et 12 12 11 na m 9 Eg ($millions), 2011e Le yp 8 ba t no n Ta jik 8 is Le tan so 31 th Sa o 29 M mo K ol d a yr gy ov a Top remittance recipients in 2011 z R 25 23 e N p. ep To al Le ng ba a n K on El o s 21 20 20 20 As % of GDP, 2010 Sa o v lv o ad or 17 16
  7. 7. Oil prices continue to provide a cushion forremittances to Asia $ billions $/barrel 140 8 120 6 100 Crude oil price (right scale) 80 4 60 40 2 Remittance outflows from Russia (left scale) 20 0 0 3 3 3 3 3 3 3 3 Q Q Q Q Q Q Q Q 04 05 06 07 08 09 10 1120 20 20 20 20 20 20 20 Source: IMF Balance of Payments and Development Prospects Group, World Bank.
  8. 8. Exchange rate depreciation has created additionalincentives to send remittancesLocal currency/US$(July 2010 = 100 ) 110 Bangladeshi Rupee Indian Rupee Mexican Peso 105 100 Indian Rupee Mexican Peso 95 Bangladesh Rupee 90 10 0 11 1 11 1 0 1 1 -1 -1 l-1 l-1 -1 -1 p- p- n- ov ov ay ar Ju Ju Se Se Ja M N N M
  9. 9. Risks to the outlook Global economic crisis in the US and Europe Anti-immigration policies in other destination countries Uncertain currency and oil price movements
  10. 10. First mile issues in remittance-sourcecountries Onerous AML/CFT regulations Exclusivity agreements between MTOs and post offices Migrants do not have adequate access to banks EU Payment Services Directive (PSD) and efforts in US to improve transparency in pricing of remittance services
  11. 11. Cost of sending remittances to developing regions is high Average cost of sending $200 to developing regions $24.8 $19.6 $17.4 $16.3 $15.4 $12.3 a A * SA C P A si N A LA C A M S E E th ou SECA excludes Russian Federation; Source: World Bank Remittances Prices Worldwide database (Sept.2011)
  12. 12. Remittance costs are falling Percent 10.0 Simple average 9.0 8.0 Weighted average 7.0 2008 Q1 Q3 Q1 Q3 Q1 Q3 2009 2009 2010 2010 2011 2011 Data on market size a key driver of market competition
  13. 13. South-South remittance costs are higher than North-South remittance costs Average cost of sending $200 within Africa (US$) Burkina Faso - Ghana $32 Ghana-Nigeria* $32 Nigeria - Ghana $25 Nigeria - Benin $21 Kenya - Uganda* $19 Burkina Faso - Cote dIvoire $18 Senegal - M ali $18 Uganda - Kenya $17 Kenya - Tanzania $17 Uganda - Rwanda $13 Uganda - Tanzania $12Excludes FX commissions and bank account maintenance fees for inter-bank transfers*Remittance prices worldwide database (Sep 2011)Source: Surveys of remittance service providers;
  14. 14. 1. Monitoring, analysis, projection - Size, corridors, channels - Counter-cyclicality - Effects on poverty, education, health, investmen - Policy (costs, competition, exchange controls)3. Financial access 4. Capital market access- Deposit and saving products International - Private banks and- Loan products (mortgages, corporations consumer loans, Remittances (securitization) microfinance)- Credit history for MFI clients Agenda - Governments (diaspora bonds)- Insurance products - Sovereign credit rating 2. Retail payment systems - Payment platforms/instruments - Regulation (clearing and settlement, capital adequacy, exchange controls, disclosure, cross- border arbitration) - Anti-money laundering/Countering financing of terrorism (AML/CFT)
  15. 15. HLD 2013 – Actions to consider in the areaof remittances Improvement of data on remittances, especially corridor-specific market size Leveraging remittances for capital market access and creditworthiness: How to support countries? Mobilizing diaspora investments via diaspora bonds
  16. 16. The wealth of the diaspora can be mobilizedthrough diaspora bonds Diaspora size Estimated savings (millions) ($ billions, 2009) Developing countries 161.5 397.5 East Asia & Pacific 21.7 83.9 Europe & Central Asia 43.0 72.9 Latin America & Caribbean 30.2 116.0 Middle East & North Africa 18.0 41.2 Sub-Saharan Africa 21.8 30.4 South Asia 26.7 53.2 The World Bank has set up a Task Force on Diaspora Bonds Source: Ratha and Mohapatra 2011.
  17. 17. Data and other resources are available at www.worldbank.org/migration
  18. 18. Global Knowledge Partnership on Migration and Development
  19. 19. Objectives  An open, multidisciplinary platform  Generate a menu of policy choices based on evidence and peer-review  Pilot policy operations and capacity building efforts
  20. 20. Thematic areas
  21. 21. 1. Monitoring, analysis, projection - Size, corridors, channels - Counter-cyclicality - Effects on poverty, education, health, investmen - Policy (costs, competition, exchange controls)3. Financial access 4. Capital market access- Deposit and saving products International - Private banks and- Loan products (mortgages, corporations consumer loans, Remittances (securitization) microfinance)- Credit history for MFI clients Agenda - Governments (diaspora bonds)- Insurance products - Sovereign credit rating 2. Retail payment systems - Payment platforms/instruments - Regulation (clearing and settlement, capital adequacy, exchange controls, disclosure, cross- border arbitration) - Anti-money laundering/Countering financing of terrorism (AML/CFT)
  22. 22. Proposed structure 10  multidisciplinary  experts Steering Committee Secretariat Donor Community Thematic working groups World Bank Migration  and Remittances Unit,  GMG member staff (up  6‐8 experts,  to 11), Policy outreach  with a World  officers (3), Admin and  Bank or GMG  web staff (3) Volunteer researchers staff as chair or  co‐chair
  23. 23. External partnerships International and regional agencies – Global Forum on Migration and Development, Global Migration Group, World Economic Forum, UN agencies, AU, EC, IOM, ADB, AfDB, IDB, G20 Research networks – Migrating out of Poverty, Africa Economic Research Consortium, CEMLA, other research institutes, universities, and think-tanks  Civil Society
  24. 24. Outputs of Migration Knowledge Platform Analytical research products Operational toolkits, fact books Web-based anthologies, archives, blogs Best practices: A menu of policy choices for the policy makers Few pilot projects and capacity building activities
  25. 25. Monitoring & evaluation Workshops and annual conference feedback Web traffic and use of tools Impact on policy debate Changes in access to information available to migrants, policy makers and researchers Requests for pilot projects and capacity building
  26. 26. Data and other resources are available at www.worldbank.org/migration

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