The Gambia is the second largest recipient of remittances in Sub-Saharan Africa in 2018 when it comes to Gross Domestic Product (GDP), according to World Bank’s latest Migration and Development Brief.
The officially recorded annual remittance flows to low- and middle-income countries released this week put The Gambia just under Comoros and ahead of Lesotho, Senegal, Cabo Verde, Liberia, Zimbabwe, Togo, Ghana, and Nigeria. The report said remittances to Sub-Saharan Africagrew almost 10 percent to $46 billion in 2018, supported by strong economic conditions in high-income economies.
The World Bank reported money transfers to poor and developing countries hit a fresh record in 2018 and should become their largest source of external financing in 2019. But it highlighted that many banks and money transfer operators charged too much, cutting into the gains of migration.
“Remittances are on track to become the largest source of external financing in developing countries. The high costs of money transfers reduce the benefits of migration. Renegotiating exclusive partnerships and letting new players operate through national post offices, banks, and telecommunications companies will increase competition and lower remittance prices,” said Dilip Ratha, lead author of the Brief.
According to the report, migrant workers and others sent home an estimated $529 billion to low- and middle-income countries last year, up 9.6 percent from the year before, which had also been a record.
“Projections indicate that remittances to Sub-Saharan Africa will keep increasing, but at a lower rate, to $48 billion by 2019 and to $51 billion by 2020,” the Brief stated. “The upward trend observed since 2016 is explained by strong economic conditions in the high-income economies where many Sub-Saharan African migrants earn their income.”
It showed that Nigeria, the largest remittance-recipient country in Sub-Saharan Africa and the sixth largest among low- and middle-income countries, received more than $24.3 billion in official remittances in 2018, an increase of more than $2 billion compared with the previous year.
A report released by the International Fund for Agricultural Development (IFAD) in June 2017 indicated that Gambian migrants contributed 22% of GDP in 2016, making it the second country in Africa (after Liberia) that relies on remittance for GDP.