Harnessing the flow of remittances, key to development – IOM
Mr Jeffrey Labovitz, International Organisation for Migration (IOM) Regional Director for East Africa, on Tuesday said improving and harnessing the flow of remittances could have a substantial impact on development.
He said international remittances had been taking on increasing weight in the global policy agenda in recent year.
Mr Labovitz said this at a three-day regional thematic meeting in Accra to focus on improving the use of migrant remittances, particularly in Sub-Saharan Africa, where the use of remittances is growing but the cost to send them is far above the world average.
The meeting was organised by the IOM’s country office for Ghana and the IOM Regional Office in Brussels, in partnership with the Africa Institute for Remittances and making Finance Work for Africa Partnership, on the theme, “Remittances in the Sub-Saharan region”.
It was to create a platform for communication, exchange and learning for 80 participants involved in IOM’s African, Caribbean and Pacific and European Union Migration Action, including migration experts and representatives from African Caribbean Pacific (ACP) governments, regional organisations, the European Union, UN agencies and NGOs working in the area of remittances and diaspora mobilization.
The discussions will also generate thematic recommendations for the Sub-Saharan region and establish links between the outcomes of the ACP-EU Migration Action programme, and processes relevant to the ACP-EU Dialogue on Migration and Development at the regional and global levels.
Mr Labovitz noted that, remittances to sub-Saharan Africa grew from $34 billion in 2017, an increase of over 11 per cent, yet it remained the most expensive place in the world to send money.
“Despite this increase – a trend which is expected to continue through 2019 – Sub-Saharan Africa remains the most expensive place in the world to send money with an average cost of 9.4 per cent of the transfer amount, a figure that was 29 per cent above the world average in 2017,” he said.
That, he said, was far short of the Sustainable Development Goals (SDGs) target 10.C to reduce the transaction costs of migrant remittances to less than three per cent by 2030.
It is estimated that almost 75 per cent of remittances are spent on consumption, which greatly benefit the receiving households and communities, yet, more could be done to maximize the remaining 25 per cent through fostering financial inclusion and promoting initiatives that help people manage the funds to harness development impacts of remittances.
Ambassador Diana Acconcia, Head of EU Delegation to Ghana said migration issues are of the greatest importance for both African and European countries and expressed his gladness for the excellent cooperation on migration management in the global and regional frameworks.
He announced that Africa and European Union were building strong partnership for the years to come with a view to ensuring mobilization of sustainable and job-generating investments in Africa, particularly for the youth.
Ambassador Acconcia said the new “Africa-Europe Alliance for Sustainable Investments and Jobs” was an essential part of a joint approach to migration: a shared responsibility for addressing the root causes of irregular migration, effectively managing borders, preventing and fighting migrant smuggling and trafficking of human beings.`
He said the EU is supporting partner countries to improve their capacity to deal with root causes of irregular migration and forced displacement through the EU Emergency Trust Fund for Africa and also the new European External Investment Plan, which would help boosting investment in Africa as well as improve economic and social development and create jobs.
Mr Akwasi Awua Ababio, Director of Diasporan Affairs Office, Office of the President, said according to a World Bank Report, remittances were three times more than Overseas Development Assistance, adding that, ‘that is a big question for all”
He said in Ghana remittances growth was significant and it was estimated at about $3 billion as at 2016 or $5 billion in 2015, which was more than the total foreign investment to Ghana.
“When we take all these into consideration, we know we are dealing with serious sum of money that can be harnessed for development,” he added.