Global remittances are set to tumble by $142bn in 2020 as the coronavirus crisis curtails a lifeline for hard-pressed households in poorer countries.
The World Bank said that a drop of almost 20 percent in the money migrant workers send home would mostly be due to a fall in their wages and employment overseas.
"Remittances are a vital source of income for developing countries. The ongoing economic recession caused by COVID-19 is taking a severe toll on the ability to send money home and makes it all the more vital that we shorten the time to recovery for advanced economies," said World Bank Group President David Malpass.
Remittances have become an integral part of the funding for governments in emerging economies, exceeding official aid by a factor of three since the mid-1990s and last year overtaking foreign direct investment flows as the main source of foreign exchange for low- and middle-income countries.
An estimated one billion migrants - about 270 million who work outside their home countries and 760 million internal migrants - each help feed, clothe and shelter up to three people "back home", Dilip Ratha, lead author of the World Bank's new report on the impact of COVID-19 on remittances, explained. "You're looking at one-third of humanity."
Hardest hit will be countries such as Tajikistan and Nepal, where remittances account for around 30 percent of gross domestic product (GDP), said Ratha. Other countries that rely on payments include the Philippines, South Sudan, Tonga, and Haiti.
The World Bank said that a drop of almost 20 percent in the money migrant workers send home would mostly be due to a fall in their wages and employment overseas.
"Remittances are a vital source of income for developing countries. The ongoing economic recession caused by COVID-19 is taking a severe toll on the ability to send money home and makes it all the more vital that we shorten the time to recovery for advanced economies," said World Bank Group President David Malpass.
Remittances have become an integral part of the funding for governments in emerging economies, exceeding official aid by a factor of three since the mid-1990s and last year overtaking foreign direct investment flows as the main source of foreign exchange for low- and middle-income countries.
An estimated one billion migrants - about 270 million who work outside their home countries and 760 million internal migrants - each help feed, clothe and shelter up to three people "back home", Dilip Ratha, lead author of the World Bank's new report on the impact of COVID-19 on remittances, explained. "You're looking at one-third of humanity."
Hardest hit will be countries such as Tajikistan and Nepal, where remittances account for around 30 percent of gross domestic product (GDP), said Ratha. Other countries that rely on payments include the Philippines, South Sudan, Tonga, and Haiti.
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