Remittance flow loses pace

Posted by BankInfo on Tue, Jan 04 2011 04:25 am

Rejaul Karim Byron

Remittance growth slowed last year compared to the previous year, and the inflow fell short of the yearly target by $1 million.

The growth was 2.62 percent in the last calendar year against a target of $11 billion. In the last few years, the growth hovered around 15-30 percent.

The remittance inflow was $10.99 billion last year, and $10.71 billion in 2009.

Officials at the finance ministry and Bangladesh Bank (BB) linked the declining growth to the fall in manpower export and the reduced earnings of the expatriates.

According to labour and employment ministry data, manpower export fell by about 18 percent last year.

A high official of the central bank said Bangladesh in the current year faces the dual challenge of containing inflation and increasing manpower export.

Remittance inflow plunged in December last year compared to November, BB data showed. In December the amount was $963.53 million, down from $998.64 million in November.

The growth of remittance showed a downward trend from the beginning of the year 2010, mainly from July.

A BB official said, apart from a fall in manpower export, many expatriate workers have returned home after losing their jobs abroad. Also, the decline in the export of skilled manpower dampened remittance inflow.

Refugee and Migratory Movements Research Unit (RMMRU), a research and policy advocacy institution, in a study in December said the export of skilled manpower went down last year, while the trend is upward among the unskilled segment.

The government took some steps last year to increase the export of manpower, such as setting up of an expatriate bank and digitalisation of the recruitment process, according to the findings of the study.

However, it said some more measures are required to improve the migration situation.

The RMMRU suggested laying highest emphasis on manpower export during the sixth five-year plan tenure.

A finance ministry report on macro-economic situation prepared last month said export of manpower, especially the skilled ones, is a big challenge for Bangladesh. The report recommended expanding Bangladesh's labour market in the countries in Eastern Europe and North and South Africa.

Source: The Daily Star/ Bangladesh/ Jan-04-2011

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