Nigeria has been a nation battling lately with issues of political unrest, with particular emphasis on the recent end SARS protest as well as bad reforms of the federal government which had also generated massive clamour by the youths and citizens of the nation in general, to demand for improved standards of living.
Be that as it may, it also appears that Nigeria is not only struggling with its political administration and execution of policies, but also with her economy as well especially in areas of financial expenditures and generation of revenues.
These financial worries has been highlighted by World Bank who in a recent publication review, projected that Nigeria will lose $2 billion in remittances from its citizens in the Diaspora.
In the recent Migration and Development Brief 33 published by the World Bank and the Global Knowledge Partnership on Migration and Development (Knomad), it was revealed that Nigeria will receive $21.7 billion in remittances in 2020 as against the 23.8 billion recorded in 2019.
“Remittances are helping to address the impact on African households. Nigeria remains the largest recipient of remittances in the region, and is the seventh‐largest recipient among LMICs, with projected remittances to decline to around $21.7 billion, a more than $2 billion drop compared with 2019,” the report read.
Remittances to low and middle‐income countries (LMICs) are projected to decline by 7.2 percent to $508 billion in 2020 and further decline by 7.5 percent to $470 billion in 2021.
According to financial experts and analyst this projected decrease in remittances are the lowest in recent records in the history of revenue remittance. It is also further lower than the five percent decline recorded during the 2009 global recession which spells. negative impact and threat to the nation’s economy.
One of the significance factor to watch out for in all of these is the cause of all these decline and recent research have revealed that it’s as a result of the already weakened economy whose growth and development has been affected by varying negative factors.
Worthy of note is also the lack of uncertainties surrounding jobs in migrant‐hosting countries, a downward spiral and inconsistencies in oil prices, and, in many remittance‐source countries, and many unfavorable exchange rates against the US dollars a currency mostly used in major and foreign bussiness transactions in Nigeria.
The report, revealed that Sub Saharan Africa is the most expensive region where one could send such revenue remittances as for instance, sending $200 to countries in Sub‐Saharan Africa cost an average 8.5 percent in the third-quarter of 2020, a decrease compared with the average cost of 9 percent recorded in 2019
Moreso the recent global Corona virus pandemic has not help matters in this regard, in fact it has made more difficult for migrants to remit money to Sub‐Saharan Africa using local or informal mediums especially as most payments are done manually through cash exchange rather than electronic transactions due to the fact that most money transfer operators are on lockdown due to this global crisis.
According to the reports released by Sub Saharan Africa, “The promotion of digital technology, which is cheaper than non-digital services, combined with a regulatory environment promoting competition in the remittances market, and relaxing money laundering regulations, are essential for Sub‐Saharan countries to achieve the SDG target of 3 percent by 2030.”
From the above reports and projections it’s obvious that the nation’s economy needs to work harder to regulate its financial status by paying attention mostly to those factors that militate against revenue generation and economic development in order to avoid going into recession.
Gift Joseph Okpakorese
Staff Writer
