Workers’ remittances cross $5 billion mark in 1Q

Inflows of home remittance sent by overseas Pakistanis crossed $5 billion mark in the first quarter of this fiscal year (FY19). According to latest statistics issued by the State Bank of Pakistan (SBP), workers” remittances posted a 13 percent growth during July-September of FY19. The SBP reported that overseas Pakistani workers remitted $5.419 billion in the first quarter of this fiscal year compared to $4.79 billion during the same period of the last fiscal year (FY18), depicting an increase of $629 million.

“Presently, the country needs massive foreign inflows to reduce pressure on external account and definitely, the higher home remittances inflows will help build depleting foreign exchange reserves,” economists said.

The massive decline in the country”s total liquid foreign exchange reserves has already forced Pakistan to negotiate with the International Monetary Fund (IMF) for another loan programme to ensure timely foreign payments and build its reserves, they added.

The country”s total liquid foreign exchange reserves continued to decline for the last one year due to higher external debt servicing and other official payments. The country”s total reserves stood at $14.893 billion, including $8.408 billion of the SBP and $6.48 billion of banks, as on September 28, 2018.

The detailed analysis revealed that inflows from all three major corridors of home remittances, ie, USA, UK and Saudi Arabia witnessed upward trend during the first quarter of current fiscal year.

Workers” remittances from Saudi Arabia increased by 3 percent to $1.263 billion in July-September of FY19 compared to $1.228 billion in the same period of last fiscal year. Despite lower growth compared to USA and UK, Saudi Arabia is still the largest contributor to home remittances inflows.

Similarly, inflows from UK increased to $828 million in the first three months of this fiscal year against $626 million in the corresponding period of last fiscal year, showing an increase of 32 percent. During the period under review, with 18 percent growth, inflows from USA rose to $759 million.

Month-on-month basis, during September 2018, the inflows of worker”s remittances amounted to $1.452 billion, which were some 12 percent higher than September 2017, in which some $1.294 billion remittances were received.

However, inflows of home remittances in September 2018 were some 29 percent less than August 2018, which attracted $2.037 billion inflows.

The country-wise details for September 2018 shows that inflows from Saudi Arabia, UAE, USA, UK, GCC countries (including Bahrain, Kuwait, Qatar and Oman) and the EU countries amounted to $360 million, $301 million, $231 million, $203 million, $134 million and $41 million, respectively compared with the inflow of $308 million, $303 million, $171 million, $195 million, $141 million and $45.07 million, respectively in September 2017.

Remittances received from Malaysia, Norway, Switzerland, Australia, Canada, Japan and other countries during September 2018 amounted to $182 million together against $130.31 million received in September 2017.