Overview

  • Background

    • International migration – the movement of people across international boundaries – has enormous implications for growth and poverty alleviation in both origin and destination countries.      
    • According to newly available census data, more than 247 million people were living outside of their countries of birth in 2013, and over 750 million migrate within their countries. In the coming decades, demographic forces, globalization and climate change will increase migration pressures both within and across borders.
    • International migration boosts world incomes. By allowing workers to move to where they are more productive, migration results in an increase in aggregate output and income.   
    • Remittances generally reduce the level and severity of poverty and lead to: higher human capital accumulation; greater health and education expenditures; better access to information and communication technologies; improved access to formal financial sector services; enhanced small business investment; more entrepreneurship; better preparedness for adverse shocks such as droughts, earthquakes, and cyclones; and reduced child labor.
    • Diasporas can be an important source of trade, capital, technology, and knowledge for countries of origin and destination.
    • Officially recorded remittances to developing countries were $427 billion in 2014, an increase of about 3.3% over the previous year. Global remittance flows, including those to high-income countries, are estimated at $580 billion in 2014. 
    • The top recipients of officially recorded remittances in 2014 were India ($70 billion), China ($62 billion), the Philippines ($28 billion), and Mexico ($25 billion). Other large recipients included Nigeria, Egypt, Pakistan, Bangladesh, Vietnam and Indonesia. However, as a share of GDP, remittances were larger in smaller and lower income countries; top recipients relative to GDP in 2014 were Tajikistan (42%), Kyrgyz Republic (30%), Nepal (30%), and Moldova, Tonga, and Liberia (all 26%).
    • Remittances sent home by migrants to developing countries are equivalent to more than three times the size of official development assistance.
    • Remittance flows to developing countries are projected to slow down to 2.0 percent growth in 2015 (to $435 billion), owing to economic difficulties in the major remittance-source countries, especially Russia. Depreciation of the euro and the ruble against the U.S. dollar further dampened remittance flows in US dollar terms, especially to countries in Europe and Central Asia. Remittances to developing countries are expected to rise by about 4 percent in 2016 and 2017, buoyed by the continuing recovery in the United States and a modest acceleration of economic activity in Europe. However, the potential for further dollar appreciation against the currencies of remittance-sending countries and the possibility of reduced remittance flows from oil-exporting countries should oil prices remain low are important downside risks to this forecast.
    • Remittance costs have fallen steadily in recent years, but they remain high, especially in Africa and in small nations where remittances provide a lifeline to the poor. Globally, migrants pay an average cost of 7.7% to send money home. Reducing the average remittance price to 5 percent, in line with G8 and G20 targets, could save migrants around $14 billion a year.

    World Bank Group Engagement

    Recognizing the close links between migration and development, the WBG is deepening its engagement on this broad agenda, including:

    • Building partnerships and strengthening collaboration: The WBG initiated the Global Knowledge Partnership on Migration
      and Development (KNOMAD), which is aimed at generating and synthesizing knowledge on migration issues for countries, generating a menu of policy choices based on multidisciplinary knowledge and evidence, and providing technical assistance and capacity building to sending and receiving countries for the implementation of pilot projects, evaluation of migration policies, and data collection. KNOMAD was launched in 2013, and is being supported with funding from Germany’s Federal Ministry of Economic Cooperation and Development (BMZ), Sweden’s Ministry of Justice, Migration and Asylum Policy, and the Swiss Agency for Development and Cooperation (SDC). The WBG is closely involved in global partnerships to develop policy coherence on the treatment of migration, including active participation in the Global Migration Group and the Global
      Forum on Migration and Development. In 2015 the WBG is the chair of the Global Migration Group. The WBG also supported efforts to reflect migration issues in the Post-2015 Development Agenda and is now involved in measurement and implementation of the related SDGs.
    • Mobilizing diaspora financial resources for development: The WBG is supporting client efforts to develop financing instruments for leveraging migration and remittances for national development purposes. Diaspora bonds can be a powerful financial instrument for mobilizing diaspora savings to finance specific public and private sector projects. The WBG has set up a Task Force for the Implementation of Diaspora Bonds to provide technical assistance to clients. Such innovative financing instruments are attracting increased interest from developing countries for financing the post-2015 development goals.
    • Improving data collection: The WBG is working with statistics gathering agencies to strengthen the collection of data on migration and remittance flows. The WBG publishes a comprehensive dataset on annual remittances data (inflows and outflows), monthly remittances data to selected countries, and estimates of bilateral migration and medical ‘brain drain’ for over 200 countries. The WBG has also prepared a dataset on second-generation diaspora stocks.
    • Providing policy advice: The WBG is actively engaged in identifying migration policies, regulations, and institutional reforms in both receiving and sending countries that are expected to contribute to superior development outcomes.
    • Strengthening the links between remittances and financial inclusion: The WBG is supporting efforts to enhance the integrity of money transfer systems and realize the potential of regular remittance flows to improve access to wider financial services for migrants and remittance recipients.
    • Measuring the global average cost of remittances: Through the Remittance Prices Worldwide database, the WBG provides a tool for monitoring progress towards the G20’s 5x5 objective. The WBG chairs the Global Remittances Working Group, which was formed in 2008 at the request of G8 countries in order to coordinate global activities on remittances.  
    • Facilitating a reduction in the cost of making remittances: The WBG is working to create an enabling environment for the reduction of remittance prices by helping to improve the infrastructure for domestic and cross-border payments, remove legal barriers to the development of sound remittance markets, and foster market competition. In FY 2013, the WBG assisted more than 20 countries worldwide, including Indonesia, Nicaragua, Samoa, and Liberia, in implementing policy reforms, technical improvements, and regulatory changes aimed at enhancing the remittance market for consumers. 

    Publications

    The WBG publishes a Migration and Remittances Factbook, which provides a snapshot of migration, skilled migration and remittances, and socio-economic characteristics for all countries, regions and income groups. A new edition of the Factbook will be
    published in 2015. A more frequent Migration and Development Brief is published at least twice annually.

    In 2012, the WBG published the “Guidance Report for the Implementation of the CPSS-World Bank General Principles for International Remittance Services,” for national authorities, international organizations, private sector stakeholders, civil society, and other entities working on remittance policy and market reform. In 2007, the WBG collaborated with the Committee on Payment and Settlement Systems of the Bank for International Settlements to publish the General Principles for International Remittances Services.  

    During 2011, the WBG issued several books related to migration, including Migration and Remittances during the Global Financial Crisis and Beyond; Leveraging Migration for Africa: Remittances, Skills, Investments and two companion volumes on Diaspora for Development of Africa, and Remittance Markets in Africa.

    In 2006, the WBG published Global Economic Prospects 2006: Economic Implications of Remittances and Migration, and Remittances: Development Impacts and Future Prospects.

     

  • Frequently Asked Questions on Migration and Remittances Data

    1) Are data available on bilateral migrant stocks by country?

    Yes. Estimates of migrant stocks are compiled in the Bilateral Migration Matrix available on the World Bank Group website at https://www.worldbank.org/en/topic/migrationremittancesdiasporaissues/brief/migrationremittances-data

    2) What are the sources for the Bilateral Migration Matrix and how is it compiled?

    The database of the UN Population Division (UNPD) is the most comprehensive source of information on international migrant stocks for the period 1960–2013. This dataset “Trend in International Migrant Stock: The 2013 Revision” contains estimates of the total number of international migrants for all 214 countries and territories by country or territory, by destination, and by origin. Factbook 2016 extends this dataset using data from new censuses and country sources, including: (1) data from the 2010 round census that UNPD did not include in the 2013 revision because the census data was released later; (2) new censuses from Sub-Saharan Africa and Latin America and the Caribbean that provided more disaggregated data by country; and (3) revised numbers for Oman, Qatar, Kuwait, Saudi Arabia, and United Arab Emirates based on recent data from the Gulf Labour Markets and Migration (GLMM) provided by Migration Policy Centre, European University Institute. The Factbook also includes more recent data on refugees (published by UNHCR).

    3) Is the Global Bilateral Migration Database (1960-2000) comparable to the Bilateral Migration Matrix (2013)?

    The two sets of data are not comparable.The Global Bilateral Migration Database uses estimations to fill the gaps for the cells. A researcher cannot use that data for estimations. The bilateral migration matrix (2010 and 2013) uses UN Population Division (UNPD) data and extends this dataset using data from new censuses and country sources.

    4) Are time series data available on the Bilateral Migration Matrix?

    No. As of now Bilateral Migration Matrix is available only for 2010 and 2013.

    5) Where can I find data on remittance inflows and outflows?

    Data on remittance inflows and outflows can be found on the World Bank Group website at www.worldbank.org/migration, under the tab on data.

    6) What are the sources for officially recorded remittance inflows and outflows data and how are they compiled?

    Where data is available, remittances are measured as the sum of two items in the International Monetary Fund’s Balance of Payments Statistics Year Book: i) personal transfers, ii) compensation of employees, and iii) migrants’ transfers (i.e., capital transfers between resident and non-resident households). For some countries, data is obtained from the respective country’s Central Bank and other relevant official sources.

    7) Are the remittances reported by the World Bank the same as the figures reported by central banks?

    In some cases, the remittance figures reported by national central banks differ from the remittance data we report. This is mainly due to differences in the definition of remittances. Most central banks measure remittances based on data from money transfer companies, which capture only a sub-component of what they report to the IMF for the Balance of Payments Statistics Yearbook. Furthermore, the transition of definitions between IMF BPM5 and BPM6 also create differences between some central bank published data and what they report to the IMF (see FAQ 9 below).

    8) Do these remittance figures capture remittance flows through informal channels?

    No. The remittances data reported by the World Bank cover only officially recorded remittances and, therefore, do not include remittances sent through informal channels. 

    9) The IMF moved from BPM5 to BPM6. How does this affect the definition of Remittances?

    The IMF has begun publishing the BoP Statistics according to the sixth version of the Balance of Payment Manual (BPM6). According to this methodology, remittances data are captured in two items: compensation of employees and personal transfers. Compensation of employees refers to "the income of border, seasonal, and other short-term workers who are employed in an economy where they are not resident and of residents employed by nonresident entities."

    Personal transfers consist of "all current transfers in cash or in kind made or received by resident households to or from nonresident households." In the BPM5, remittances are measured as the sum of compensation of employees, workers' remittances, and migrants' transfers. The new definitions are expected to improve data on remittances by bringing them closer to the compilation methodology used by many countries. A comparison of remittances data between the two formats shows that in most cases, the differences are minor. (For further details, see Migration and Development Brief 19 at: http://goo.gl/vkGt3; and the International Transactions in Remittances: Guide for Compilers and Users at: http://www.imf.org/external/np/sta/bop/2008/rcg/pdf/guide.pdf )

    10) Why are the total inflows of remittances higher than the total outflows?

    Numerous factors explain the difference between total inflows and outflows, including better monitoring of inflows, and possible under-reporting of outflows.

    11) Why are remittances data missing for some countries?

    Remittances data are missing for countries that do not report to the IMF the components constituting the definition of remittance (i.e., compensation of employees and personal transfers). Statistical capacity building efforts are ongoing in many countries to improve reporting.

    12) Are there monthly and quarterly data on remittance?

    Monthly and / or quarterly remittances data are available for about 150 countries. These data are available from the websites of the respective country’s’ central banks and other relevant official agencies. These may not match IMF BoP and World Bank reported figures due to definition differences.

    13) Is the definition of remittances the same for annual, monthly and quarterly data?

    Not necessarily. The annual remittances data are captured as described in FAQ 6 above, while the sources for the monthly and quarterly data are less specific. 

    14) Are there data on bilateral remittance flows (disaggregated by country pairs)?

    With the exception of a few countries like the Philippines and Pakistan that do report a breakdown of remittances by source countries, there are no official data on remittance flows between countries. The bilateral remittance matrices reported by the World Bank (found at the following webpage: https://www.worldbank.org/en/topic/migrationremittancesdiasporaissues/brief/migrationremittances-data ) aim to fill this gap.

    15) How are the bilateral remittance matrices estimated?

    Two key datasets are used to construct the bilateral remittance matrices. The first is the Bilateral Migration Matrix, which can be found at the following link: https://www.worldbank.org/en/topic/migrationremittancesdiasporaissues/brief/migrationremittances-data. The Bilateral Migration Matrix provides estimates on immigrant stocks, disaggregated by migrant source countries, in all the countries for which data is available. It is based on data collected from countries’ census bureau and other relevant sources. The second key dataset used in the construction of the Bilateral Remittance Matrix is the remittance inflows data, found at the following link: https://www.worldbank.org/en/topic/migrationremittancesdiasporaissues/brief/migrationremittances-data. The remittance inflows data are constructed as the sum, where data is available, of two components in the IMF’s Balance of Payments Statistics: i) compensation of employees, ii) personal transfers. Constructing the Bilateral Remittance Matrix involves allocating a country’s total remittance inflows in a given year to its emigrant stocks estimated in the Bilateral Migration Matrix, adjusting for the migrant sending and receiving countries’ per capita income.

    It is important to emphasize that this is not an official figure. The methodology used is described in greater detail in the paper: "South-South Migration and Remittances" by Ratha and Shaw (2007).

    16) Is it possible to estimate remittance outflows based on the Bilateral Remittance Matrix?

    Yes, remittance outflows can be estimated using the Bilateral Remittance Matrix. For a given country, summing across the columns gives the total remittance outflows from that country in the given year.

    17) Remittance outflows based on the Bilateral Remittance Matrix are different from the migrant remittance outflows reported to the IMF. What explains the discrepancies?

    While the migrant remittance outflows data (https://www.worldbank.org/en/topic/migrationremittancesdiasporaissues/brief/migrationremittances-data) reported to the IMF are the official figures as monitored by respective central banks and statistical agencies, the estimates based on the Bilateral Remittance Matrix allocate total remittance inflows based on the methodology discussed in Ratha and Shaw (2007) "South-South Migration and Remittances". (see FAQ 15). Given that total reported inflows and outflows also differ, these two outflows figures will not be the same.

    18) Are time series data available on the Bilateral Remittance Matrix?

    Yes. So far, there are Bilateral Remittance Matrices for 2010, 2011, 2012, 2013, 2014 and 2015. All of them are constructed following the same methodology, discussed under FAQ 15.

    19) In the Bilateral Migration Matrix and the Bilateral Remittance Matrix, there are categories called “Other South” and “Other North.” Which countries are included in these two categories?

    As noted in FAQ 15, the Bilateral Remittance Matrix figures are estimates and, therefore, not official figures. A critical input in the estimation exercise is the Bilateral Migration Matrix, itself constructed based on data collected from the respective country census data. These census reports list only the major migrant source countries and lump the rest under a category called “other", with no information of which countries are in this category. Ratha and Shaw (2007) developed a methodology for allocating this "other" category into Other North and Other South, but no specific information is available on countries of origin in these categories.

    20) How often are the migration and remittances data updated?

    The migration and remittance data are updated as new data become available. The annual remittance inflows are generally updated twice a year coinciding with the release of the Migration and Development Briefs. The next update is scheduled around April 2017.

    21) How can I find out about the latest updates to migration and remittances data?

    The latest update to migration and remittance data can be found by visiting our website, https://www.worldbank.org/en/topic/migrationremittancesdiasporaissues/brief/migrationremittances-data. Updates are also announced through the People Move blog: http://blogs.worldbank.org/peoplemove.

    22) I have questions on your remittance and migration data that are not covered in this FAQ.Whom can I contact?

    If you have further queries related to Migration and remittance data, you can send an e-mail to Migration and Remittance team at: migrationandremittances@worldbank.org.

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