At the start of this year 2021, the World Bank reported that diaspora remittances to Nigeria for the year 2020 fell to $ 17 billion from $ 23 in 2019. Analysts attributed the use of platforms to alternative forms powered by blockchain technology, in part, as the reason for the reduction. Since then, the FG has taken steps not only to stabilize the Naira, but also to increase diaspora remittances.

The gist of this article is to examine why the FG relegated our timeless attribute of resilience and resourcefulness as a nation, to focus on improving diaspora remittances rather than focusing on l ’empowerment of local businesses with the potential to generate foreign exchange to do so.

Some facts about the diaspora and remittances
The word diaspora comes from the ancient Greek diaspeiro, which means “to sow on”. It is translated as “dispersion” or “diffusion”. Most definitions generally refer to the dispersal of the Jews. Wikipedia calls it “a dispersed population whose origin is in a distinct geographic location.” In 2020, the total number of international migrants was estimated at 281 million people, or 3.6% of the world population, of which around 15 million are believed to be Nigerians. In 2017 alone, around 1.3 million people left Nigeria in search of greener pastures.

According to the International Monetary Fund, remittances are income of households from foreign economies primarily from the temporary or permanent movement of people to those economies. Remittances include cash and non-monetary items that pass through formal channels such as wire transfers, or informal channels, such as money or goods transported across borders.

In 2018, Nigerians abroad sent a total of $ 25 billion, accounting for around 6.1% of GDP that year, which placed Nigeria second in Africa after Egypt with $ 28 billion. of dollars. However, recent reports from the World Bank show that in 2019 it fell to $ 23.81 billion; and in 2020, to $ 17.21 billion, or 4% of Nigeria’s gross domestic product in 2020.

India estimates that the diaspora population is 17.9 million and that it received $ 245.27 billion in remittances in the three years between 2018 and 2020, while Nigeria, with about 15 million migrants, received about 64 billion dollars during the same period. Bangladesh is estimated to have a diaspora of 7.4 million people in 2020. It received a total of $ 55.68 billion from 2018 to 2020.

In 2020, the following five countries topped the world for remittances; India (83 billion), China (60 billion), Mexico (43 billion), the Philippines (35 billion) and Egypt (30 billion). India has been in first place since 2008. According to the World Bank, the decline in flows to sub-Saharan Africa is mainly due to a 28% drop in remittances to Nigeria. Excluding flows to Nigeria, remittances to sub-Saharan Africa increased by 2.3%, demonstrating resilience.

When remittances were measured against the GDP of recipient countries in 2020, they were 4.0% in Nigeria, 3.0% in India and 6.6% in Bangladesh. It is also known that remittances to low and middle income countries (LMICs) reached $ 540 billion in 2020, only 1.6% below the total of $ 548 billion in 2019.

In 2020, the average cost of sending $ 200 to lower middle-income countries remained high at 6.58%, well above the SDG target of 3%. The highest average remittance costs, at around 8.2%, were seen in sub-Saharan Africa, while South Asia had the lowest average remittance costs at 4.9% . Others include; Europe and Central Asia (6.4%); East Asia and the Pacific (6.9%); the Middle East and North Africa (6.6%); and Latin America and the Caribbean (5.6%).

Recent World Bank research published on its website found that around 50% of the Nigerian population is ready to relocate abroad if given the opportunity. In West Africa, Nigeria ranked 3rd after 70% of Liberians and 60% of Sierra Leoneans expressed a common interest. Among Nigerians who have considered emigration, their main reasons revolve around the economy, looking for a job, escaping economic hardship / poverty and seeking better business prospects. Other reasons include a good atmosphere, peaceful coexistence, food security, adequate employment, attractive opportunities, provision of skills, good transport sectors, good education, less conflict, democratic elections, less theft and arson as well as less means of taxation. In terms of contribution, diaspora communities can make a unique contribution to the development of their countries of origin, in particular with a view to strengthening physical capital and productivity, while ultimately helping to stimulate job creation, standard of living and higher growth. In addition to supporting capital investments, diasporas also support productivity by funding education, training and health care.

The issue of remittances in Nigeria dates back to the early 1960s, when the first group of Nigerians to go abroad tried to save the situation and the economic situation of those who remained at home. Since there was no significant difference in the value of the naira against the dollar, this was not a big deal until the late 1980s, during the time of General Ibrahim Babangida. It was at this point that the Naira was first devalued and Nigerians abroad realized that it was wise to send a few dollars home to be compensated by several Naira. In an article attributed to former Finance Minister Chief Anthony Ani, the use of IMTO like Western Union and MoneyGram contributed to the success at the time, as many Nigerians living abroad voluntarily sent money to their wards at home for one purpose or the other.

While researching the meaning of Diaspora, I found Dictionary.com’s meaning very interesting. He describes it as “any group that was dispersed outside its traditional homeland, especially unwittingly, as Africans during the transatlantic slave trade.” The dictionary may have attributed the early migration to the transatlantic slave trade, but the Nigerian diaspora had their reason to migrate. The existence of the Nigerian diaspora can be described in the following category;
Those whose pursuit of higher education traveled abroad and after realizing the environmental comparative advantage, decided not to return after their studies. This set of people stayed in their country of study to build this nation rather than coming back to help build Nigeria.

Those who have traveled to seek a better life and to lift their families out of poverty. This set of people is made up of uneducated, partially and fully educated individuals. They simply traveled to earn money and live a good life. There are no demographic, ethnocultural, geographic or religious limitations for people in this group.

Those whose migration was prompted by the ruling military junta. This group of people was made up of professionals, politicians, business leaders, etc. While some returned after the junta, many had settled down and decided to build a future for their families.

Those in the middle class feel that their extended stay in Nigeria will not give their children a global competitive advantage. These sets move in droves, move families and settle permanently abroad in the hope that their children become citizens of the world.

These young people with or without jobs, skilled or unskilled who feel that Nigerian politics have drowned their voices and that gerontocratic leadership leaves them no room to flourish.

Those who are well off, influential and live in abundance but have traveled to obtain health insurance for their old age. This group of people believe that the healthcare system in Nigeria cannot support their old age and would prefer to move to where it would cost them then to enjoy life when they become elderly.

Those who are young professionals who are drawn to global technology companies on a daily basis. It is not uncommon today to find young Nigerians moving abroad to work for tech or tech-focused companies like Andela, Google, Microsoft, etc.

These professionals whose skills are in great demand globally and claim to be frustrated and whose continued calls for government intervention for better well-being have been ignored.

These categories share a common denominator in the failure of government and leaders to project hope and faith in the country of Nigeria. Their departure or migration would then easily fall under involuntary status. The word “involuntary” in the definition above interested me, and that is the deep and inner purpose of this article.

To be continued tomorrow


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