The Gulf region is a major source of remittances to a number of Arab nations – thanks to a large size of population working in the oil-exporting countries.
Remittances from Gulf region to Arab countries continue to rise despite decline in oil prices.
“What we’re seeing is that the GCC remains a key hub for remittance outflows to other Arab countries. The World Bank Migration and Development Report coincides with our internal research, which shows that remittance corridors remain steady even in the face of market challenges and the socio-political landscape in the Arab world.
“Our year-on-year remittance transactions to the Arab markets have grown by 6 per cent in Q1 2016. The conclusion is that the GCC is very much the de facto destination for expatriate workers to come, live, save and remit due to sound government policies and robust economies,” said Promoth Manghat, CEO, UAE Exchange.
The report states that remittances from the GCC to other Arab countries remained strong, with Egypt, Jordan and Yemen featuring among the leading remittance receivers.
The World Bank Group Report notes that despite economic pressures, remittance outflows from oil exporting GCC countries continued to rise in 2015 due to maintenance of fiscal spending, and the peg to a strong US dollar by most economies in the GCC. Several positive initiatives and investments being undertaken in the GCC region, like the Expo 2020 in the UAE, Fifa World Cup in Qatar etc., contribute to driving diversified economies with optimism.
Promoth notes, “We’ve been aware of the importance of the GCC to Egypt and Jordan corridors for a while. These countries are among the largest receivers of remittances from the GCC, and we’ve seen a rise in our remittance transactions to Egypt and Jordan by 14.4 per cent and 13.5 per cent respectively in Q1 2016 compared to the same period last year. It’s worth noting that Egypt receives three times the revenue generated by the Suez Canal from global inward remittances.”
According to the World Bank Group Report, global remittance flows to Middle East and North Africa stood at an estimated $50.3 billion. The figure is expected to rise to $51.6 billion in 2016, and hit $54.5 billion in 2018. The GCC is expected to continue playing a key role in this increase.