Dilip Ratha

Migration and Remittances TeamSocial Protection and JobsWorld BankWashington, D.C.April 12, 2019

Migration, Remittances

and Development

Summary

1. Global migration flows are on the rise as is the challenge of returning migrants and asylum seekers

2. Migration-related Sustainable Development Goals (SDGs):

- Remittances to low- and middle-income countries expected to reach $550 bn in 2019, larger than FDI (SDG 17.3.2)

- Remittance costs average 7%, still far from the 3% target (SDG 10.c.1)

- Recruitment cost indicator moved up to from Tier III to Tier II (SDG 10.7.1) – now we need to undertake surveys in 30+ corridors

3. Implementation of Global Compact on Migration could benefit from initiating a voluntary Systematic Review Framework

International migrant stock: 266 million in 2018

Migrants (240 million)

Refugees (26 million)*

Source: UN DESA, UNHCR, and World Bank staff estimates.

* Including 5.4 million Palestinian refugees.

Refugee movements have slowed

Source: UNHCR

0

5

10

15

20Refugee stocks (millions)

World

European Union

Number of new asylum seekers in EU-28 fell

significantly

Source: Eurostat

0

200

400

600

800

1,000

1,200

Pending asylum

applications

First-time asylum seekers

(Thousands)

Return migration is likely to increase from

the European Union and the United States

Source: Calculations using data from Eurostat.

Note: Asylum seekers are first time asylum applicants coming from non-EU28 countries.

Undocumented detected stockt = undocumented detected stockt-1 + new undocumented detectedt

– returned.

0

1

2

3

4

5

6

7

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

EU

USA

# of undocumented detected (million)

Remittances to low- and middle-income

countries are likely to surpass FDI in 2019

-100

100

300

500

700

900

FDI

Remittances

ODA

($ billion)

Portfolio debt

and equity flows

Source: World Bank staff estimates, World Development Indicator, and IMF’s BOP statistics

Excluding China, remittances have been larger

than FDI since 2015

0

200

400

600

FDI

Remittances

($ billion)

Source: World Bank staff estimates, World Development Indicator, and IMF’s BOP statistics

Remittance flows grew strong in 2018,

particularly in SAR and ECA regions

6.7

9.19.5 9.6

11.2

12.3

EAP MENA LAC SSA ECA SAR

Growth, year-on-year (%)

Source: World Bank

Top recipients of remittances in 2018

Source: World Bank, April 2019

79

67

36 3429

24 2116 15 14

($ billion, 2018)

3534

31 3128

21 20 19 18 16

(% of GDP, 2018)

Average remittance costs remain

significantly higher than the SDG target

7.1

5.2

5.9

6.7

7.6 7.3

9.4

6.9

5.0

6.26.7

7.26.8

9.3

0

2

4

6

8

10

Global SAR LAC ECA EAP MENA SSA

First Quarter 2018 First Quarter 2019(Percent)

SDG target, by 2030

Source: Remittance Prices Worldwide, World Bank.

Fees vs FX margins

Source: Calculations by World Bank staff for 2018 Q4 based on the Remittance Price Worldwide database

10

17 1814 14

1814

16 15 1512 13

13

4 1

4 40

31 2 2

4 3

0

5

10

15

20

25Fees Foreign-Exchange margins

(Percent)

Banks have highest cost followed by MTO-

Post Office partnerships

Source: World Bank-KNOMAD staff analysis based on World Bank Remittance Prices World wide

database 2018 Q4.

4.1

5.54.6

6.2

9.0

7.7

9.610.2

India World

Average cost (%)

Post office Money Transfer Operator MTO/Post Bank

Exclusivity

premium, 4.4

Exclusivity

premium, 1.5

Global Remittances Agenda

Leverage Remittances

Sell diaspora bonds

Promote financial inclusion

Micro-insurance

Sovereign credit ratings

Future-flow securitization

Mobile money, crypto currency

Recruitment costs disproportionately high for

low-income workers

Source: KNOMAD-ILO Migration Costs Surveys

0

5

10

15

20

25

30

35

0 200 400 600 800 1000 1200 1400Pakistan-KSA: Average monthly foreign earnings (constant 2016$)

Months of earnings

A Systematic Review Framework for

Global Compact on Migration

• Similar to G20 Mutual Assessment Process

• Voluntary preparation of Activities and Policies Template (APT)

• Facilitate discovery of good practice, replication, mutual consistency,

collaboration

• Help develop baseline and benchmark for monitoring progress

Activities and Policies Template

• GCM Objective 1

– Sub-objectives (all or some important ones)

– Planned actions as migrant-sending country

– Planned actions as migrant-receiving or transit country

– Indicate complementary actions you’d expect from partner

countries; also indicate which countries

– Comments by partner countries

– Summary assessment by external experts (eg, KNOMAD and UN

Migration Network) and additional actions identified

• Repeat for GCM Objectives 2-23

Summary

1. Global migration flows are on the rise as is the challenge of returning migrants and asylum seekers

2. We are making progress on migration-related SDGs:

- Remittances to low- and middle-income countries expected to reach $550 bn in 2019, larger than FDI (SDG 17.3.2)

- Remittance costs average 7%, still far from the 3% target (SDG 10.c.1)

- Recruitment cost indicator moved up from Tier III to Tier II (SDG 10.7.1) – now we need to undertake surveys in 30+ corridors

3. Implementation of Global Compact on Migration could benefit from initiating a voluntary Systematic Review Framework

4. World Bank is in a position to support the global community