NIGERIAN diaspora remittances fell by 27% year-on-year in 2020 to $17.2bn from $23.55bn in 2019 as the economic impact of the coronavirus pandemic hurt Nigerians living abroad hard forcing them to reduce the amount they remit back home.
Although Nigeria itself has been spared the worst excesses of the global pandemic, diasporans have been hit hard, especially those living in Europe, the US and China. Apart from the fact that there has been a high casualty rate, many Nigerians in the diaspora have seen their businesses suffer as a result of government lockdowns.
Historically, Nigeria has always been among the top five countries in the world when it comes to remittances behind India, Mexico, Egypt and the Philippines. Last year, however, all these economies suffered drops as a result of the pandemic but the Nigerian decline of 27% was 18.2 percentage points below the 8.8% decline projected by the World Bank for both Nigeria and the Sub-Saharan African.
In a report issued in October and titled Migration and Development Brief 33, the World Bank projected that remittances inflow into sub-Saharan Africa will fall to $44bn in 2020 from $48bn in 2019. It also projected that remittance inflows into Nigeria will fall to $21.7bn in 2020 from $23.8bn in 2019.
Last October, a World Bank spokesman said: “Remittances to sub-Saharan Africa are expected to decrease significantly by around 8.8% between 2019 and 2020, from $48bn to $44bn due to the Covid-19 pandemic, restrictions on movement their devastating impacts on the global economy. “Nigeria remains the largest recipient of remittances in the region and is the seventh-largest recipient among low and middle-income countries, with projected remittances to decline to around $21.7bn, a more than $2bn drop compared with 2019.”
However, the 27% decline in remittances into Nigeria in 2020 imply that the negative impact of the pandemic on the economic fortunes of the diaspora is more severe than expected. Central Bank of Nigeria (CBN) figures confirm this, showing that remittance inflows fell in both halves of 2020.
In the first half of 2020, remittances fell by 23.7% from $11.82bn in 2019 and this trend worsened in the second half of the year with remittance inflows falling by 30% to $8.2bn from $11.73bn. This tear, the World Bank projected a further decline in remittance inflows for Nigeria and other countries in the sub-Saharan region in 2021 and stressed the need for government measures to address the downward trend.
It added: “This declining trend is expected to continue in 2021 when remittances are projected to decrease by around 5.8% to $41bn in sub-Saharan Africa. The decline in remittance flows is attributed to a combination of factors, all driven by the Covid-19 crisis in major destination countries, including the European Union, the United States, China and Gulf Cooperation Council countries.
“Sub-Saharan migrants are disproportionately affected in host countries as many are in precarious working conditions and informal jobs, with high vulnerability to contagion and loss of employment. In addition, these migrants are often excluded from social protection systems, health care and government stimulus measures.”