Covid-19: Remittance nosedive & the fate of expatriates
The expatriates have a lot of contribution in our national economy, those send remittances to Bangladesh through their hard labour. Remittance is considered the life blood of our national economy. Remittance has become an important aspect for the developing countries like Bangladesh for socio- economic advancement. It is the second-highest source of foreign currency earnings for Bangladesh, second only to the ready-made garments industry. However, in terms of net earnings, remittance can be considered the highest, since a large portion of RMG earnings need to be spent on raw materials.
But due to the worldwide COVID-19 outbreak and lockdown, most of the activities are stopped now and the anticipation of economic recession has already been resumed in many countries. As a result, life style of all classes people are also halted, their income sources are standstill and this time economic cycle has no momentum. The many expatriates who stayed outside of the country come back to our country fearing the risk of COVID-19 infection and also safe their life.
Within the countrywide lockdown, most of them are staying either isolated in their house or social distancing from others. But sadly they are facing serious discriminatory approach from their family, near ones, relatives and neighbours. Some of them approached such rude behaviour with them, it seems that they are foreigners or classless and they are unfamiliar with the society. Such type of discomforting behaviour is very unfortunate and undesirable. They are the son of this soil, they love this motherland and they come back here considering the prevailing plight situation of the country where they stayed. They had no other alternative to do in this crisis moment.
The expatriates send remittance of $14.86 billion upto April '20, $16.42 billion in FY' 19 and $14.98 billion in FY'18. The upward trend of inward remittance has already declined due to the worldwide lockdown and this may be continued in the coming days untill recover the economic upturn. During 1-19 May, 2020 before this Eid festival, the expatriates send $1091 million and in the last year same time they send $1094 million and in April '20 send 1086.40 million.
The inflows from the migrant workers, which rose 21.49 percent to $11.05 billion in the first seven months of the FY' 20 on the back of the 2 percent cash incentive, had kept the growth momentum until January' 2020. But the momentum came crashing in the following months as the impact of the deadly bug started to become evident. In April, remittance fell 24 percent year-on-year to $1.08 billion, the lowest in 13 months.
World Bank predicted that: remittance inflow to Bangladesh may nosedive by as much as 22 percent in 2020 because of the fallout of the global Covid-19 pandemic, which is a major blow to the economy. Money sent by the migrant expatriates is projected to fall to $14 billion this year, said the same prediction.
As migrant workers lose their jobs, it is not only the economies they work in that suffer, but also the economies of their home countries. Analysts say a big shock lies ahead for economies that rely heavily on remittances, including India, Bangladesh, Philippines and others. It will hit on two fronts: returning workers are expected to add to swelling unemployment rolls, and the revenues they used to contribute, vital foreign currency earnings, will fall.
Falling oil prices will affect remittance outflows from the GCC countries and Malaysia and the coronavirus-induced economic slowdown from the US, the UK and the EU to South Asia. Apart from the GCC countries, a major chunk of Bangladesh's migrant workers lives and work in Malaysia and Singapore, while the US and the UK are respectively home to 0.5 million and 1 million expatriate professionals.
Bangladeshi expatriates in some European counties, especially in Italy, find themselves in a precarious situation amid the novel Covid-19 outbreak, with many of them left with no jobs and stuck at home without adequate supply of daily essentials.
Remittances mainly came from Middle Eastern countries such as the United Arab Emirates, Saudi Arabia, Kuwait, USA, Malaysia, Singapore and others European countries. But regrettably some important destinations like the United Arab Emirates, Malaysia and Bahrain have remained closed for Bangladeshi workers for long.
As the early phases of the crisis unfolded, many international migrants, especially from the Gulf countries, returned to countries such as India, Pakistan and Bangladesh. Gulf countries, which include Saudi Arabia, the UAE and Kuwait, are home to 75 percent of about 10 million Bangladeshis living abroad. Since the middle of February, about 0.20 million migrant workers returned home, with most arriving from Saudi Arabia, the UAE and Malaysia and they are creating extra pressure on the employment and economy of the country.
The remitters who stayed in abroad devoted hard labor to earn foreign currency and the government are encouraging them to send more and more remittance through formal channel but it is a matter of fact that the foreign mission are not sincere enough to the remitters in abroad. When they come back to Bangladesh, they have explained their bitter experience to their near ones. However, within the volatile COVID-19 outbreak, the foreign missions have a little scope to do something for the betterment of the expatriates but the mission have a significant role after withdrawal of worldwide lockdown.
In Bangladesh, remittance is one of the most important economic variables in recent times as it has an impact on economic growth, it helps in promoting balance of payments, increasing foreign exchange reserves, enhancing national savings and increasing velocity of money. For about two decades remittance has been contributing around 35% of export earnings. Moreover, it is greater than foreign aid and thus helps in lessening dependence on foreign aid remittance gets momentum in recent time in Bangladesh and is the second largest sector of foreign currency earnings after the garment; sector. If cost of imported raw materials is deducted from the foreign currency earning of the garments sector, then it becomes the largest sector of foreign currency earnings.
After the outbreak, many European countries, specially Italy, Spain, France and Germany have taken some unprecedented measures to contain the spread of the virus. Those measures include enforcing lockdown, banning travel, shutting down shops, restaurants, bars, small businesses, and non-essential company departments. Tourism in those countries has also been hit hard and many expatriate workers have already either off the job or left the country in fear of the pandemic and safe their life.
Nobody knows what is anticipated in the fate of the migrant expatriates in the coming days and it has a high risk either loss their job permanently or have no chance to join there prevailing the current situation.
Gripped by the fear of being infected, they are seriously concerned about their livelihood as their families back home in Bangladesh heavily depend on their income. They fear bleak days ahead if the situation does not improve and return their previous job without any hassle. Those who have valid job contracts might get some compensations, but the others illegal or undocumented would be in a "bigger trouble".
Although it is not an easy task, the Bangladesh government should extend its support to the expatriates and get engaged with the authorities of the coronavirus-hit countries and to overcome the upcoming volatile situation in job market as well as remittance inflow, we should take precautionary measures to tackle the issues smoothly.
The writer is banker and freelance contributor