Remittances are financial or in-kind transfers made by migrants directly to families or communities in their countries of origin. The World Bank compiles global data on international remittances, notwithstanding the myriad data gaps, definitional differences and methodological challenges in compiling accurate statistics. Its data, however, do not capture unrecorded flows through formal or informal channels, and the actual magnitude of global remittances are therefore likely to be larger than available estimates. Despite these limitations, available data reflect an overall increase in remittances in recent decades, from USD 126 billion in 2000, to USD 689 billion in 2018.
There was a 9% increase in remittances in 2018, up from USD 633 billion in 2017. However, the two consecutive years prior to 2017 witnessed a decline; from 2014 to 2015, global (inward) flows of remittances contracted by an estimated 1.2%, from USD 603 billion in 2014 to USD 595 billion in 2015, and by another 1.1% from 2015 to 2016 (from USD 595 billion to USD 589 billion). Consistent with this trend, remittances to low- and middle-income countries (which account for the majority of the global total) had declined for two consecutive years, from 2014 to 2016 – a trend that had not been seen for three decades, according to the World Bank, before returning back to the positive long-term trend from 2016 to 2018 (from USD 444 billion in 2016, to USD 483 billion in 2017, and USD 529 billion in 2018). Since the mid- 1990s, remittances have greatly surpassed official development assistance levels, defined as government aid designed to promote the economic development and welfare of developing countries.35
In 2018, India, China, Mexico, the Philippines and Egypt were (in descending order) the top five remittance- recipient countries, although India and China were well above the rest, with total inward remittances exceeding USD 67 billion for each country. When remittances are viewed as a percentage of gross domestic product, however, the top five remittance-receiving countries in 2018 were Tonga (at 35.2%), followed by Kyrgyzstan (33.6%), Tajikistan (31%), Haiti (30.7%) and Nepal (28%).
High-income countries are almost always the main source of remittances. For decades, the United States has consistently been the top remittance-sending country, with a total outflow of USD 67.96 billion in 2017, followed by the United Arab Emirates (USD 44.37 billion), Saudi Arabia (USD 36.12 billion) and Switzerland (USD 26.6 billion). The fifth-highest remittance-sending country in both 2016 and 2017 was Germany (with total outflows of USD 20.29 billion and 22.09 billion, respectively). In addition to its role as a top recipient, China (classified as an upper-middle-income country by the World Bank) has also been a significant, although declining, source of remittances, with USD 20.29 billion in 2016, down to USD 16.18 billion in 2017.
Top countries receiving remittances (2005–2018) (current USD billions)
Top countries sending remittances (2005–2018) (current USD billions)
SOURCES: World Bank, IOM
IMAGE CREDIT: Wikimedia Commons / AMISOM Public Information [CC0]