Remittances to Ghana up by 5% to $3.6bn in 2020 contrary to estimates

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Accra, GHANA: A woman holds 03 July 2007 in Accra a wad new currency, the new cedi, that Ghana put in circulation that day, although the old money will still be valid until the end of the year. Currently, the cedi is one of the least valued currencies in Africa: 9000 cedis equal one US dollar. Ernest Addison, head of research at the Bank of Ghana, assured in November 2006 that the changeover was not a revaluation nor devaluation, and will not affect foreign exchange. AFP PHOTO / ISSOUF SANOGO (Photo credit should read ISSOUF SANOGO/AFP/Getty Images)

Despite the impact of covid-19 on global economies, remittances to Ghana shot up by 5% to US$3.6 billion last year, according to World Bank’s 2021 Migration and Development report.

With the exception of Nigeria where there was a significant decline in remittances, foreign inflows to Africa went up by 2.3%.

According to the report, Ghana was ranked second behind Africa’s most populous nation, benefiting significantly from remittance flows last year.

[COVID-19 could slash remittances to Ghana and other African countries by $18 billion]

“Remittance flows to the region were estimated to have declined by 12.5% in 2020. The decline was almost entirely due to a 27.7% decline in remittance flows to Nigeria, which alone accounted for over 40% of remittance flows to the region.”

“Excluding Nigeria, remittance flows to Sub-Saharan African increased by 2.3 percent, demonstrating resilience at a time of crisis. Indeed, strong remittance growth was reported in Zambia (37%), Mozambique (16%), Kenya (9%), and Ghana (5%)”, the report added.

There are hundreds of thousands of Ghanaians residing in the United States, United Kingdom, Germany and France who remit funds regularly to their families, love ones and relations in the country.

During the covid-19 pandemic, where most of these economies were lockdown for greater periods of months, Ghanaians in the diaspora were not perturbed, but continued to send monies to their families and friends back home in Ghana.

[Ghana and other African countries to lose $37bn in remittances]

Importantly, the country benefited from the remittance flows as its contribution to Gross Domestic Product was reasonable.

Banks were also not left out as their commissions from the remittances were expected to have gone up.

Nonetheless, the report said remittance flows to the region were affected by the COVID-19 pandemic, in particular by restricted mobility measures and the employment situation in the main host countries. Ghana was however not much affected as remittances to urban and rural areas went up slightly.

Top remittance recipients in Sub-Saharan Africa in 2020 (US$)

Nigeria17.2bn
Ghana3.6bn
Kenya3.1bn
Senegal2.6bn
DR Congo1.9bn
Somalia1.7bn
South Sudan1.2bn
Zimbabwe1.2bn
Uganda1.1bn
Mali1.0bn

Source: myjoyonline