In observance of the International Day of Family Remittances, the United Nations Network on Migration joins the international community in acknowledging the significant contribution that migrants and their families make towards the realization of the 2030 Agenda for Sustainable Development through their remittances which, in 2021, are estimated to have amounted to USD 751 billion globally.
The Network also welcomes the Progress Declaration, which reviews progress in implementing the Global Compact for Safe, Orderly and Regular Migration, adopted at last month’s International Migration Review Forum. The Declaration reaffirms that remittances are a critical source of support for families and communities.
Today there are about 230 million migrants working outside their countries of origin. Despite the heavy toll of the prolonged COVID-19 pandemic on economies and the loss of millions of jobs affecting migrants in particular, remittance flows to low and middle-income countries remained resilient. Officially recorded remittances to low- and middle-income countries reached USD 553 billion in 2019, USD 558 billion in 2020, and USD 605 billion in 2021. Forecasts indicate that remittances will reach USD 630 billion in 2022.
Through these funds, migrants play a catalytic role in the local development of their communities and countries of origin. Remittances contribute to improving food security, as well as access to health, education, housing and sanitation, can help reduce child marriage, child labour and other forms of exploitation, as well as improving health outcomes. Remittances can facilitate financial inclusion for hundreds of millions of family members, thereby having a positive impact on savings, investments, entrepreneurship and job creation. They help reduce inequalities and build the way towards financial independence.
Migrant workers send remittances often in the face of severe obstacles, including wage discrimination, substandard working conditions, lack of access to social protection, health services and adequate, safe and affordable housing, prolonged family separation and exploitation including trafficking in persons. Migrants cannot contribute fully towards sustainable development, if they are not treated with equality and inclusion, with their rights fully respected.
Leveraging various forms of capital, migrants also bring opportunities to build climate resilience in countries of origin. Economic capital, such as remittances and diaspora investments are often used to support small business owners and rural farmers financially during climate-related crises. Additionally, human capital, such as knowledge and skills transfers, can further build resilience through adaptation. Zero-cost fair recruitment of migrant workers is critical to enhancing remittance flows and productive investments.
The Global Compact for Safe, Orderly and Regular Migration, in its Objective 20, calls on the global community to “promote faster, safer and cheaper transfer of remittances and foster financial inclusion of migrants”. Member States reaffirmed their commitment in the IMRF’s Progress Declaration to redoubling efforts to reduce the cost of sending remittances by adopting digital solutions and promoting digital and financial inclusion.
However, in 2021, the average cost of sending USD 200 remained above 6 per cent, twice the SDG 10.c target of 3 per cent. More needs to be done by all stakeholders to address this gap. Better collection and analysis of sex-disaggregated data on remittances are crucial to understand the market, improve policies and provide an enabling environment for leveraging remittances.
The private sector has a key role to play in the achievement of this SDG target. As a result of COVID-19 restrictions, Remittance Service Providers are increasingly making use of digital solutions, with more competition in the sector and a related reduction of the transfer costs, allowing more migrants to transfer money via mobile phones.
However, while digital solutions bring advantages of cost, convenience and security, we must be mindful that many migrants, in particular migrants in an irregular situation and migrant women, as well as their families in their countries of origin, might lack the digital and financial access that make these advantages a reality. We need to redouble our efforts to ensure the inclusion of those most at risk of being left behind.
Linking remittances with financial services and products, matched with adequate and gender-sensitive digital and financial literacy, is key to leveraging these flows for sustainable development.
On this special occasion, the Network, bringing together 39 United Nations entities, reaffirms its commitment to promote the development impact of migrants’ remittances, and joins the IDFR 2021-2022 campaign “Recovery and resilience through digital and financial inclusion”. The campaign aims to raise awareness and advocate actions to leverage remittances for local development and job creation, including for women, youth and future generations.
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