Remittances surge to record high

[SHAMK9]

KARACHI: With an impressive 17.7% annual growth, remittances sent home by overseas Pakistanis surged to a record high and crossed the psychological mark of $13 billion in the previous fiscal year 2011-12, the State Bank of Pakistan (SBP) announced on Tuesday.
Continuous growth in remittances is being billed as a lifeline for Pakistan’s economy, especially when energy shortages and high inflation have hurt gross domestic product (GDP) growth.
“Remittances have been playing a key role in the country’s economic performance,” said Muzammil Aslam, Managing Director of Emerging Economics Consultancy.
“One can safely say that the continuous rise in remittances in the last few years has saved Pakistan from serious economic problems including default on debt repayments.”
Aslam suggested that the government can further increase the flow of remittances if it reduces the difference between interbank and open market exchange rates for the US dollar from the present one rupee to 10 to 15 paisa. “This will encourage overseas workers to send more and more dollars through banking channels instead of illegal means.”
Invest Capital Markets analyst Khurram Schehzad commented that the continuous rise in remittances is significantly positive for the country as the money supported the economy in different forms. Overseas Pakistani workers remitted a record amount of $13.186 billion in the last fiscal year ended June 30, 2012, compared with $11.201 billion received a year earlier, the SBP said.
Except for September ($890.42 million) and November ($924.92 million), Pakistanis remitted more than $1 billion in each of the remaining 10 months.
Monthly average of remittances rose 17.73% to $1.099 billion compared with $933.41 million a year earlier.
In June overseas Pakistanis sent home $1.117 billion compared to $1.104 billion received in the same month of 2010-11.
In the same month, remittances from Saudi Arabia, UAE, USA, UK, GCC countries and EU countries amounted to $333.68 million, $219.14 million, $206.60 million, $128.12 million, $126.72 million and $29.24 million respectively. In comparison, remittances from these countries were $291.55 million, $270.04 million, $204.64 million, $121.35 million, $106.20 million and $33.83 million respectively in June 2011.
Analysts believe that the SBP’s initiative for facilitation of remittances, called the Pakistan Remittance Initiative (PRI), has significantly contributed to the growth of remittances.
Since its inception in April 2009, PRI has taken a number of steps to enhance the flow of remittances through legal channels. These include preparation of strategies on remittances, taking all necessary steps to implement the overall strategy, playing an advisory role for the financial sector in terms of preparing a business case, relationship building with overseas correspondents, creating separate and efficient remittance payment highways and becoming a national focal point for overseas Pakistanis through a round-the-clock call centre.
Published in The Express Tribune, July 11th, 2012.
Remittances surge to record high – The Express Tribune

 

[RiazHaq]

Remittances are an important source of income for households in Khyber Pakhtunkhwa (KP) and other provinces in Pakistan, according to a 2010 World Bank report titled "Poverty fell in Pakistan in 2001-08 partly because of remittances". A recent Asian Development Bank study found that foreign remittances constituted 9.4 percent of household income in KP, compared to 5.1% for Punjab, 1.5% for Baluchistan, and 0.7% for Sindh.

Haq's Musings: Pakistani Diaspora is the World's 7th Largest

 

[Alchemy]

It clearly indicates that value of your local currency has fallen much compared to $ ,Euro and other currencies .... the people currently remitting just want to utilize this fall in local currency value and would be withdrawing later .... Its a cyclic thing happens in India too !

 

[Elmo]

Pakistan becomes fifth largest remittances recipient country


ISLAMABAD: Pakistan has become the fifth largest remittances recipient developing country in 2011, witnessing a strong growth of 25.8 per cent during the last year in 2011 compared to the 10.1 per cent growth in South Asia remittances.


The upward trend in remittances, during the period under review, was derived from a per annum average growth from UAE of 32.2 per cent followed by United Kingdom 30.1 per cent, Saudi Arabia 27.3 per cent, European Union countries 25.3 per cent, other GCC countries 15.1 per cent and United States of America 9.5 per cent from 2007-08 to 2010-11, states a document issued in Economic Survey of Pakistan.

During July-April 2011-12, workers remittances grew by 20.2 per cent and stood at $1.83 billion 10.9 billion. The cumulative increase of $1.83 billion during July-April 2011-12 over the July-April 2010-11 is largely attributed to the government efforts to divert remittances form the informal to the formal channel.

Since the launch of the Pakistan Remittances Initiative (PRI), the share of workers remittances coming through the banking channel has increased considerably from 75 per cent in 2009-10 to 91 per cent in 2011-12.


The World Bank estimated that the flow of remittances to developing countries in 2011 increased by 0.8 per cent from $ 325 billion 2010 and is expected to grow at seven to eight per cent annually till 2014.


Pakistan becomes fifth largest remittances recipient country | DAWN.COM

 

[timz]

remmittanzc

 

[Zeeshan360]

When U have remittances , who needs FDI

 

[A1Kaid]

The Pakistani economy is too dependent on remittance, this is both good and bad news.

 

[xyxmt]

FDI inflow stops for political reason, Remittance only grow thats the difference. With remittance like this if we can control the imports of cell phones we can have really nice balance of payments, put heavy duty of cell phone, a population that doesnt work much doesnt need cell phones.