Relatives and acquaintances of Nigerians living abroad may likely receive more money this year if the report by FBNQuest is anything to go by.
It would be recalled that the recent report by FBNQuest report indicates that Nigerians living abroad sent home $22 billion in 2017, a 16.4 per cent increase from the amount they repatriated in 2016 and there are indications that this may increase this year.
The Central Bank of Nigeria (CBN)’s balance-of-payments data for the third quarter 2017 showed a continuation of the upward trend in workers’ remittances/transfers since the foreign exchange reforms earlier this year.
But FBNquest “suspects that the principal drivers of remittances through recorded channels are the ease and cost of transactions.”
The World Bank had indicated that transfer costs to sub-Saharan Africa were among the most expensive in the world, at an average 9.1 per cent of the transaction. These costs had spawned the emergence of digital transfer operators in competition with the traditional players in the field.
“The latest annual total (of $19.5 billion in 2016) can surely be bettered when we allow for the size of the Nigerian Diaspora, estimated at up to 18 million people,” the report added.
The report stated further: “Remittances of $5.71 billion in the third quarter 2017 were the highest since the fourth quarter of 2010 ($5.75 billion). We expect a decent increase for the current quarter, which generally sees the largest inflow of the year due to the holiday season.”
According to the report, the receiving institutions in Nigeria are not required to document the purpose of remittances.
However, one London-based transfer company has estimated that 80 per cent of the transactions it handles were for family support. The federal government had also raised $300 million from the sale of Diaspora bonds in the first quarter of 2017.
Aside remittances, Nigeria as a country is also reaping the benefit of trades abroad as the country recorded the first trade balance surplus in two years when it posted a trade balance in excess of N2.15 trillion in the first quarter of the year.
National Bureau of Statistics (NBS) titled Foreign Trade in Goods Q1 2018 showed the total value of Nigeria’s merchandise trade was N7.211 trillion in the first quarter of 2018, which was a 19.74 per cent growth from the figure recorded in Q4, 2017 (N6.022 trillion) and a 35.07 per cent growth from Q1, 2017 (N5,339.24 billion).