Diaspora Nigerians reduce remittances 21% YoY
By Jeph Ajobaju, Chief Copy Editor
Direct diaspora remittances dropped to $952 million in the first half of the year to June (H1 2023), a 21 per cent decrease year-or-year (YoY) on $1.210 billion in H1 2022, according to the latest release from the Central Bank of Nigeria (CBN).
The CBN broke down the 2023 figures as follows:
- January – $79.2 million
- February – 83.8 million
- March – $138.6 million
- April – $150 million
- May – $202.9 million
- June – $297.5 million
Direct remittances totalled $2.16 billion in 2022, a figure that may still be reached or surpassed if remittances improve in the second half of 2023.
KPMG Nigeria Chief Economist and Head of Research, Yemi Kale, said there may not be any cause for alarm now over the decline in remittance despite the surge in the number of Nigeria relocating abroad.
“The decline is probably due to election uncertainty and the CBN cash and forex drama in Q1. I won’t be bothered till I see Q3 and Q4,” he said, per Nairametrics.
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Forex sources
Direct remittances come into the country via the International Money Transfer Operators (IMTO), banks, among others.
Suspended CBN Governor Godwin Emefiele earlier this year listed the four major sources of foreign exchange (forex or FX) as proceeds from oil exports, proceeds from non-oil exports, diaspora remittances, and foreign direct/portfolio investments.
He disclosed last year at the launch of the CBN “RT200 FX Programme” to boost forex supply through the non-oil sector that diaspora inflows grew from an average $6 million per week in December 2020 to an average $100 million per week by January 2022.
Diasporans remit $168b to Nigerian economy
Diaspora Nigerians remitted $168.33 billion to the country between 2015 and 2022, according to World Bank reports, but other sources of foreign investment fluctuated in the seven years, stoking foreign exchange (forex) scarcity.
Data from both the World Bank and Nigeria’s Budget Office shows diaspora remittances play a key role in mitigating the impact of forex scarcity and keeping afloat external reserves.
The World Bank said remittances inflow to sub-Saharan Africa (SSA) grew 5.2 percent to $53 billion in 2022, with Nigeria receiving the largest share.
Breakdown of figures
The World Bank broke down the amount Nigerians living overseas sent home between 2015 and 2022 as follows:
- 2015 – $21.2 billion
- 2016 – $19.7 billion
- 2017 – $22 billion
- 2018 – $24.31 billion
- 2019 – $23.81 billion
- 2020 – 17.21 billion
- 2021 – $19.2 billion
- 2022 – $20.9 billion