Record $1.2b remittance flows in 15 days of Nov

Bangladesh earned a record $1.2 billion in remittance in the first 15 days in November, the finance ministry said yesterday, despite grim forecasts made at the height of the pandemic about the money sent by migrant workers.

Even amid the coronavirus pandemic, the surge in remittance has kept its pace, the ministry said in a press release. In just 12 days this month, expatriates sent more than $1 billion.

"This is a rare event in the history of Bangladesh," it said.

From July 1 to November 12, remittance inflow stood at $9.69 billion, up 43.42 per cent from $6.89 billion year-on-year.

The migrant workers remitted $2.11 billion in October, which was way higher than $1.64 billion flown to the country in the same month a year ago.

October's receipts were the third-highest monthly flow in history, behind July's $2.59 billion and September's $2.15 billion.

The increasing trend of remittances has given a massive respite to the government to manage its external sector from the ongoing economic hardship.

Experts hope the trend would continue in the coming months given the global economic scenario and the initiatives taken by the government.

Finance Minister AHM Mustafa Kamal has expressed his gratitude to the expatriates.

He said the global economy faced a significant economic crisis suddenly because of the Covid-19. During the pandemic, the migrant workers have emerged as the drivers of the economy by sending their hard-earned money, he said.

The government introduced a 2-per cent cash incentive for the remittances sent through legal channels in the last fiscal year. Soon, remittances started to increase, Kamal said.

"At the time, many people started to say that it [the incentive] would not be effective and the flow would not sustain," he said in the press release.

Even, international organisations expressed doubt about the remittance flow, he said.

"But the flow of remittance since the announcement of the incentive has proved their predictions wrong, and it proved once again that we were right," the minister said.

"Achieving more than $2 billion in remittance in a single month is rare in Bangladesh's history," he said.

Diversion of remittances from informal to formal channels due to the difficulty of carrying money under travel restrictions amid the pandemic and damages inflicted by the recent floods helped Bangladesh bring the remittance flow back to the positive territory in 2020, according to a recent statement of the World Bank.

In April, the multinational lender had said money sent by the migrant workers to Bangladesh is projected at $14 billion for 2020, a fall likely of about 22 per cent because of the fallouts of the pandemic.

The rising flow from May led the WB to forecast on October 30 that inbound remittance would accelerate by about 8 per cent to $19.8 billion this year.

Bangladesh is forecast to have posted the highest year-on-year remittance growth of 53.5 per cent among the top 49 recipient-countries in the third quarter of 2020.

Bangladesh received $18.3 billion in remittance in 2019.

Remittance is an important pillar of Bangladesh's economy and the second-largest source foreign currency after exports, accounting for 5.8 per cent of gross domestic product last year.