The World Bank has said that higher food prices and the continued adoption of official bank channels will see diaspora remittances to Nigeria grow to $29 billion in 2022.
This was contained in one of the bank’s reports, titled “Migration and Development Brief (May 2022): A War in a Pandemic: Implications of the Ukraine crisis and COVID-19 on the global governance of migration and remittance flows.”
The Bretton Woods institution predicted the projected inflow increase on the likelihood of Nigerians abroad sending more money home to help with the hike in the prices of staples.
“In 2022, remittance inflows are projected to grow by 7.1 per cent driven by continued shift to the use of official channels in Nigeria and higher food prices – migrants will likely send more money to home countries that are now suffering extraordinary increases in prices of staples,” it said.
It further revealed that remittance flows to low and middle-income countries are expected to increase by 4.2 per cent to $630bn in 2022.
“With risks weighted to the downside, there are several factors that support a view for continued—though more moderate—7.1 per cent gain inflows to Sub-Saharan Africa in 2022.
“Momentum for the use of official channels in Nigeria should sustain an uptrend in the year, within flows reaching $21bn. Though economic activity is likely to ease in the United States and Europe, fundamentals remain positive for continued gains in remittance flows to the remainder of Africa, as the influence of ‘altruistic’ motivations that were demonstrated in Africa and South Asia during the peak pandemic years will likely carry over to the period of sharp increases in staple food prices,” the report read in part.
It pointed out that remittance inflow to Sub-Saharan Africa was $49 billion in 2021, with Nigerians contributing $19.2 billion to the total inflow.
The global bank stated that the Naira-4-Dollar policy of the Central Bank of Nigeria (CBN), which was an attempt to return remittance to formal channels, helped boost inflows by 11.2 per cent in 2021.
The World Bank report further stated that the stabilisation of the naira against the dollar within a range of 410-415 per dollar over the last year also contributed to the pickup in recorded inflows and that the increased stability of the Naira and increased use of the e-Naira would help boost the nation’s chances of achieving $21bn in remittance for 2022.
