In accordance with the report by the Asian Development Bank (ADB) published on August 3, 2020 , if the economic impact of Covid-19 persists throughout the year then global remittances may fall by $108.6 billion in 2020. As per the report, there is severe continuous impact of pandemic on the global economic systems and employment.
-Migrant workers are in extreme situations while many others are facing scant job security and limited access to social assistance.
-In the last three months of the outbreak, global remittances will fall by $108.6 billion in 2020. This is equivalent to an 18.3% decline from what would have been expected without the impact of Covid-19.
-Remittance receipts in Asia and the Pacific would fall by $54.3 billion, equivalent to 19.8% of remittances in 2018.
-Remittances in South Asia are expected to fall the most, by $28.6 billion, 24.7% of 2018 receipts, followed by remittances to Central Asia ($3.4 billion), Southeast Asia ($11.7 billion).
-On the region front, there will be a $22.5 billion fall in remittances from the Middle East, which accounts for 41.4 % of the total remittance loss in Asia. This is followed by a $20.5 billion slump in remittances from the US, which is 37.9% of the total.
What are Remittances?
A remittance is a transfer of money by a foreign worker to an individual in their home country. These are a vital source of income for developing countries as these help families to afford food, healthcare, and basic needs.
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In accordance with the report on impact of COVID-19 on migration and remittances by World Bank, titled “COVID-19 Crisis: Through a Migration Lens”, released in April 2020, remittances to India are likely to drop by 23% to USD 64 billion in 2020 from USD 83 billion in 2019 due to COVID-19 impact. In 2019, the remittances were increased by 5.5%. Importantly, India is the world’s biggest recipient of remittances, which bolster the country’s foreign exchange reserves and help fund its current account deficit.
About Asian Development Bank (ADB):
President– Masatsugu Asakawa
Headquarters– Mandaluyong, Philippines
Members– 68 Nations