Saudi Arabia ranked 3rd globally in remittance outflows and second in the Arab world in 2023 with around SR144 billion ($38.4 billion) last year alone. The latest World Bank report titled ‘Migration and Development Brief’ reveals that the U.S. topped the global list for remittance outflows with a total of $85.75 billion in 2023. In second place came the UAE with $38.5 billion, making it the first in the Arab world.
MENA remittances decline
Remittances to the Middle East and North Africa (MENA) region declined by 15 percent to $55 billion in 2023, primarily due to a sharp decrease in flows to Egypt. The divergence between official and parallel foreign exchange rates likely diverted remittances to unofficial channels in the country. In March 2024, Egypt unified its exchange rates causing a rebound in official remittances.
Slower growth in the Gulf Cooperation Council (GCC) region impacted flows to the region. The World Bank now expects flows to recover by 4.3 percent in 2024. The report also reveals that the cost of sending money in the region averaged 5.9 percent, down from 6.7 percent in 2022.
Global landscape
In 2023, remittance flows increased most to Latin America and the Caribbean by 7.7 percent, followed by South Asia at 5.2 percent, and East Asia and Pacific at 4.8 percent, excluding China. Sub-Saharan Africa saw a slight decline of 0.3 percent, while the Middle East and North Africa experienced a nearly 15 percent drop, and Europe and Central Asia saw a 10.3 percent decline.
After a period of strong growth during 2021-2022, official remittance flows to low- and middle-income countries (LMICs) moderated in 2023 to around $656 billion.
The modest 0.7 percent growth rate reflects large variances in regional growth. However, remittances remained a crucial source of external finance for developing countries in 2023, bolstering the current accounts of several countries. Notably, remittances surpassed foreign direct investment (FDI) and official development assistance (ODA) in 2023.
Looking ahead, remittances to LMICs are expected to grow at a faster rate of 2.3 percent in 2024, although this growth will be uneven across regions.
Read: Experts forecast robust growth for the UAE economy in 2024 amid global challenges
Top 10 countries in remittance outflows
The top 10 countries recording the highest remittance outflows include:
- United States: $85.757 billion
- UAE: $38.5 billion
- Saudi Arabia: $38.393 billion
- Switzerland: $35.659 billion
- Germany: $24,054 billion
- China: $20,237 billion
- Luxembourg: $17.991 billion
- Netherlands: $16.737 billion
- France: $15.866 billion
- Kuwait: $12.679 billion
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