Migration and Remittances
June 5, 2013
- Remittances to the region are expected to grow from $40 billion in 2012 to $52 billion in 2015.
- Four of the top ten recipents of migrant remittances as a percentage of Gross Domestic Product are in Europe and Central Asia.
- The World Bank Group migration program in the region aims to help countries respond to policy, program, and institutional challenges.
Migration and remittances are extremely important topics for many countries in Europe and Central Asia (ECA) – with four of the top ten recipients of migrant remittances as a percentage of Gross Domestic Product (GDP) in 2011 coming from the region (Tajikistan, Moldova, the Kyrgyz Republic, and Kosovo).
Many countries in the ECA region have experienced increasing inflows from migrant worker remittances over the past several years. Economic growth – as well as poverty reduction achievements - in most of these countries has been intertwined with migration and remittance trends. The World Bank Group has undertaken the challenge of helping countries throughout the ECA region cope with ongoing issues associated with migration and remittances through both lending initiatives and migration policy improvement.
Migration has grown in importance in the region over the last decade, with remittances increasingly contributing to foreign exchange earnings, economic growth, and poverty reduction throughout Europe and Central Asia. Remittances are expected to grow from an estimated $40 billion in 2012 to a forecasted $52 billion by 2015. This pattern is very distinct in many ECA countries, with a special attention to Commonwealth of Independent States (CIS). Increasingly, a large share of the labor force in many CIS countries resides abroad.
The economic contractions in Russia and Kazakhstan have become the major source of concern to CIS countries. These Governments are seeking ways to cushion their economies from potential adverse effects.
Among the issues that could negatively affect the current account position is a large-scale return of migrants and a decrease in remittance flows. With remittance inflows of about $6.5 billion in 2012, Ukraine is the largest recipient in the region, followed by Russia with $5.7 billion, and Tajikistan with $3.7 billion. As economic conditions improve in the European Union and growth in Russia remains robust, officially recorded remittances to the ECA region are expected to rebound in 2013-2015, exceeding the pre-crisis peak in 2014 and reaching $52 billion in 2015.
Migration and Remittances in Europe and Central Asia
Understanding international agreements on migration, examining the signals that predict trends, and developing innovative approaches to migration management are among those topics that guide the World Bank Group’s work on migration and remittances issues. The migration program in ECA region is trying to help countries respond to policy, institutional, and program challenges of migration and remittances in the quest for sustained economic growth and poverty reduction.