Impact and Implications of Remittances

Remittances, the transfer of money by immigrants to their countries of origin, haves eclipsed Official Development Assistance (ODA) and are fast rivaling Foreign Direct Investment (FDI) as major sources of funds for developing countries. The global diaspora population has grown rapidly and remits regularly to countries of origin. The USA and Saudi Arabia are the major sources of remittances whereas India and Mexico, are top receivers. Zimbabwe, a country that witnessed economic decline from the year 2000 saw a surge in its citizens leaving the country to settle abroad. These immigrants used their new found wealth in their new found host countries to cushion families back home from the vagaries of economic recession. The money they remitted helped in importing food and other welfare uses like health and education. Most importantly the remittances boosted the foreign currency coffers of the country thus giving it much reprieve from the sanction ridden pariah status it got itself into. Other small countries, like Swaziland and Lesotho, depend primarily on remittances (primarily form South Africa) to sustain their domestic economies.