Ghana to see modest rise in remittance inflows

By: Daniel Nonor

Remittances to Ghana will reach an estimated US$119 million in 2010, up from US$114 million the previous year, according to Migration and Remittances Factbook 2011, a World Bank publication that tracks documented private transfers of funds, and migratory patterns around the world.

In total, remittance flows to Sub-Saharan Africa will reach US$21.5 billion this year, after a small decrease in 2009, due to the global financial crisis.

The book shows that Africa-bound flows fell by about four per cent between 2008 and 2009, marking it the first decrease since 1995.

“We estimate that recovery will continue over the next two years, with remittance flows to the continent, possibly, reaching about US$24 billion by 2012,” said Dilip Ratha, manager of the Migration and Remittances unit at the World Bank.

Ratha cautions that these numbers are gross underestimates, because millions of Africans rely on informal channels to send money home.

Worldwide, remittance flows are expected to reach US$440 billion by end of 2010, up from US$416 billion in 2009. About three-quarters of these funds, or US$325 billion, will go to developing countries.

The World Bank estimates that flows to developing countries, as a whole, will rise further over the next two years, possibly exceeding US$370 billion by 2012.

Remittances are a critical lifeline for families and entire communities across Africa, especially, in the aftermath of the global crisis, Ratha said.

The fact that remittances are so large, come in foreign currency, and go directly to households, means that these transfers have a significant impact on poverty reduction, funding for housing and education, basic essential needs, and even business investments.

There is a pressing need to make it easier and cheaper to send and receive remittances in Africa. The average cost of sending money to Africa is more than 10 percent, the highest among all the regions. The cost of sending money within Africa is even higher.

In absolute dollars, Nigeria is by far, the top remittance recipient in Africa, accounting for US$10 billion in 2010, a slight increase over the previous year (US$9.6 billion).

Other top recipients include Sudan (US$3.2 billion), Kenya (US$1.8 billion), Senegal (US$1.2 billion), South Africa (US$1.0 billion), Uganda (US$0.8 billion), Lesotho (US$0.5 billion), Ethiopia (US$387 million), Mali (US$385 million), and Togo (US$302 million).

As a share of gross domestic product, the top recipients in 2009 were Lesotho (25 per cent), Togo (10 per cent), Cape Verde (9 per cent), Guinea-Bissau (9 per cent), Senegal (9 per cent), Gambia (8 per cent), Liberia (6 per cent), Sudan (6 per cent), Nigeria (6 per cent), and Kenya (5 per cent).

Migration Trends

The book estimates that nearly 22 million Sub-Saharan Africans have left the continent. Africa also, has a higher intra-regional migration rate than the rest of the developing world, with three out of four African migrants living in another country in Sub-Saharan Africa.

In general, islands and fragile, or conflict-afflicted states, have the highest rates of skilled emigrants. Nationals, who attended university and left their country the most, are from Cape Verde (68 per cent), Gambia (63 per cent), Mauritius (56 per cent), Seychelles (56 per cent), Sierra Leone (53 per cent), Ghana (47 per cent), Mozambique (45 per cent), Liberia (45 per cent), Kenya (38 per cent), and Uganda (36 per cent).

Africa’s most dynamic migration corridors are Burkina Faso-Côte d’Ivoire (1.3 million migrants), Zimbabwe-South Africa (0.9 million), and Côte d’Ivoire-Burkina Faso (0.8 million). Others include Uganda-Kenya, Eritrea-Sudan, Mozambique-South Africa, Mali-Côte d’Ivoire, the Democratic Republic of Congo-Rwanda, Lesotho-South Africa, and Eritrea-Ethiopia.

Nearly 825,000 Ghanaians are living outside Ghana in 2010. Among the tertiary-educated population, 47 per cent are living outside Ghana as of 2000, and over 37 per cent of physicians trained in Ghana live outside the country.

The top destination countries for emigration from Ghana are Nigeria, Côte d’Ivoire, the United States, the United Kingdom, Burkina Faso, Italy, Togo, Germany, Canada, and Liberia. It is estimated that more than 1.85 million non-Ghanaians are living in Ghana in 2010, nearly 42 percent of who are women.

Migration and Remittances Factbook 2011 is the second edition of an initial volume issued in 2008. The Factbook relies on data publicly available from reliable sources.

As a result, data on some important migration corridors, for example, from Zimbabwe to South Africa, are not adequately covered in the book.

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