Nigeria Remittance Flows Declined 27.7% in 2020, World Bank Says

Nigeria Remittance Flows Declined 27.7% in 2020, World Bank Says

By Bashir Olanrewaju

Remittance flows into Nigeria fell 27.7 percent last year, lagging other African countries that on the whole witnessed an increase in transfers from abroad, according to the World Bank.

A decline of 12.5 percent in inflows into sub-Saharan Africa was largely due to the “decline in remittance flows to Nigeria, which alone accounted for over 40 percent” of the 42 billion dollars sent to the region in 2020, the World Bank said in a report released on its website. Without Nigeria, money transfers from abroad rose 2.3 percent, with Zambia seeing a 37 percent surge, Mozambique 16 percent and Kenya 9 percent, among the top recipients.

Funds sent from Nigerians abroad fell sharply last year as many in the diaspora avoided official channels that offered lower exchange rates in the country’s multiple exchange-rate system. It was a sharp departure from a growth trend that saw remittances surging from 2017, reaching 24.3 billion dollars a year later before paring to to 23 billion dollars last year.

Even that hasn’t proved enough to meet demand in the parallel markets, where many, shut out by central bank’s exclusion of  certain commodities from foreign currency allocation for  imports, now resort to. Many Nigerians have also sought to buy dollars as a hedge against the depreciation of the naira, further adding pressure on the currency.