While migration issues draw political fire in Europe and beyond, the greater development benefit of the approximate half trillion US dollars that migrants send home each year to poor families and nations can’t be underestimated, according to Adolfo Brizzi, Director at the UN’s International Fund for Agricultural Development (IFAD).
Speaking at the event “Money Talks – Why Migrants Matter” at the Perugia International Journalism Festival, Brizzi said migrants’ money represents a critical lifeline for millions of households, helping families raise their living standards above subsistence and vulnerability levels, while investing in health, education, housing as well as entrepreneurial activities.
“We hear concerns raised about migrants and refugees entering countries, but let’s not forget that the money they send home, particularly to countries where conflict or environmental disasters are taking a toll, actually helps stabilize families and rebuild communities,” he said.
It is estimated there are almost 250 million international migrants worldwide living outside their countries of origin. Remittances – the money sent back by migrant workers to their relatives – is believed to support an additional 750 million people worldwide. When senders and receivers are added together, remittances directly touch the lives of one in every seven people on the planet.
Most of the migrant workers’ earnings stay in the country where they presently reside. Only a fraction, typically in amounts of $200 or $300, is sent back home several times a year. While these amounts may appear small, they can represent up to 50 per cent or more of a family’s income. Adding together all the billions of transactions involved, remittances reached almost half a trillion dollars in 2015, more than three times the official development assistance from all sources.
Despite the large sum, Brizzi said he believed benefits for families back home could be much higher if they had access to more competitive money transfer markets and targeted financial services to help them save and/or invest their funds.
Over the last decade, IFAD has piloted over 50 programmes to leverage the impact of remittances in rural areas in more than 40 developing countries, helping to aid the flow of funds and giving families more options to invest their money and create opportunities for business development and employment.