Statistics on Remittances

International development aid isn’t only the business of states and international institutions. Remittances are a large part of this aid. Remittances are money sent back home by migrant workers. The total amounts are more important than foreign aid and some developing countries are heavily dependent on them in the sense that remittances represent a large share of their national income or GDP.

Officially recorded remittance flows to developing countries are estimated to have been above $350 billion in 2011, up 8 percent over 2010. Migrants will send $374 billion to developing countries in 2012. If we include remittances to the rich world, the total is more than $500 billion. Given the fact that a lot of money is not sent home officially through money senders such as Western Union - but rather in suitcases, letters etc. – the totals are probably even higher.

Remittances therefore are immensely important for poverty reduction in poor countries.

17% of global remittances originate from the US. Saudi Arabia and the Gulf countries are also important sources. Tajikistan is the country most dependent on remittances in the world. Transfers from the million or so Tajiks living abroad are equivalent to 45 percent of G.D.P. To some extent remittances flows mirror migration flows: the more immigrants/emigrants a countries has, the more money flows out/in.

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As seen from the following graph, this kind of informal aid has indeed become more important than the formal, government sponsored or international development aid:

remittances by destination

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Remittances to Mexico exceed $20 billion a year. Mexico the largest recipient of money sent from the U.S.

(source, based on information from Raúl Hernández-Coss for the World Bank; click image to enlarge)

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