Malawians living in the diaspora sent back home about US$38 million in 2017, a latest report by the World Bank has shown.
The amount, according to the Migration and Development Brief released on Monday, is $4 million more than $34 million recorded in 2016.
The bank says remittances to low- and middle-income countries rebounded to a record level in 2017 after two consecutive years of decline.
World Bank estimates that officially recorded remittances to low- and middle-income countries reached $466 billion in 2017, an increase of 8.5 percent over $429 billion in 2016.
Global remittances, which include flows to high-income countries, grew 7 percent to $613 billion in 2017, from $573 billion in 2016.
The stronger than expected recovery in remittances is driven by growth in Europe, the Russian Federation, and the United States. The rebound in remittances, when valued in US dollars, was helped by higher oil prices and a strengthening of the euro and ruble.
India topped the list of remittance recipients with $69 billion, followed by China at $64 billion, the Philippines at $33 billion, Mexico at $31 billion, Nigeria at $22 billion, and Egypt at $20 billion.
Remittances to sub-Saharan Africa accelerated 11.4 percent to $38 billion in 2017, supported by improving economic growth in advanced economies and higher oil prices benefiting regional economies.
Lead author of the brief, Dilip Ratha, who is also head of Knomad said while remittances are growing, countries, institutions, and development agencies must continue to chip away at high costs of remitting so that families receive more of the money.
“Eliminating exclusivity contracts to improve market competition and introducing more efficient technology are high-priority issues,” Ratha said.
Senior Director of the Social Protection and Jobs Global Practice at the World Bank, Michal Rutkowski, said the institution is mobilising financial resources and knowledge on migration to support migrants and countries with the aim of reducing poverty and sharing prosperity.
“Our focus is on addressing the fundamental drivers of migration and supporting the migration-related Sustainable Development Goals and the Global Compact on Migration,” Rutkowski said.
Reserve Bank of Malawi Spokesperson, Mbane Ngwira, said the central bank, in collaboration with the Ministry of Foreign Affairs, started engaging the diaspora from late last year to boost remittances.
Among others, Ngwira said the move is also aimed at ensuring that barriers to entry into remittance business are reduced to encourage competition which would lead to reduction in transaction cost.
He said the engagement also seeks to ensure that foreign exchange regulations encourage innovative financial products to encourage the diaspora invest in cost effective money transfer business operations.
“The initiative is also aimed at attracting diaspora direct investment and mobilisation of diaspora savings. We also seek to create a conducive environment to encourage diaspora direct investment.