Can Government Incentive on Remittance Encourages Remitters in Bangladesh? A Policy Study (original) (raw)
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Foreign remittance inflow in Bangladesh: A statistical analysis
Global Journal of Business, Economics and Management: Current Issues
The major goal of this research is to assess Bangladesh's foreign remittance inflows. In recent years, remittance has risen to prominence as one of the most important economic variables, since it helps with the surplus balance of payments, foreign reserves, aggregate savings and money circulation. Bangladesh's foreign trade has begun to improve after overcoming the negative effects of the COVID-19 pandemic. In comparison to the previous fiscal year, total export earnings declined by 16.93% to US$ 33,674.09 million in FY2019–20. During the first half of fiscal year 2020–21, export earnings totalled US$ 35,180.81 million, up 13.64% over the same period of the previous fiscal year. Furthermore, remittance earnings are growing at a slower rate than emigration from Bangladesh, owing to a rising number of unskilled or semi-skilled labourers in overseas migration rather than professional. Remittances have a great impact on Bangladesh's economy. Keywords: Foreign remittance, mon...
The Effect of Macroeconomic Variables on the Inflow of Remittance in Bangladesh
Bangladesh is one of the biggest remittances receiving country in this world and maintains this status from several years. This amount is about 12% of GDP and more than half of total export earnings. According to a World Bank Report Bangladesh is amongst the top ten nations which receive huge amount of remittances from abroad and for this Bangladesh‟s foreign exchange reserve has significantly gone up in 2013.In the last several years, Bangladesh‟s foreign exchange reserve continued to puff up crossing the 16−billionmark.Furthermore,ifthetotalamountofmoneythatisremittedthroughinformalchannelsisalsotakenintoaccount,thetotalamountofremittancethatisreceivedinBangladeshwillsoaruptohighermagnitudes.ThemajorsourceofremittanceinflowinBangladeshisthefromtheMiddleEasterncountries.Asnotedbyanofficialassociatedwithlabormigration,"remittanceshavebeencausingasilenteconomicrevolutioninBangladesh.”Thecountryisexpectedtoreceive16-billion mark. Furthermore, if the total amount of money that is remitted through informal channels is also taken into account, the total amount of remittance that is received in Bangladesh will soar up to higher magnitudes. The major source of remittance inflow in Bangladesh is the from the Middle Eastern countries. As noted by an official associated with labor migration, "remittances have been causing a silent economic revolution in Bangladesh.” The country is expected to receive 16−billionmark.Furthermore,ifthetotalamountofmoneythatisremittedthroughinformalchannelsisalsotakenintoaccount,thetotalamountofremittancethatisreceivedinBangladeshwillsoaruptohighermagnitudes.ThemajorsourceofremittanceinflowinBangladeshisthefromtheMiddleEasterncountries.Asnotedbyanofficialassociatedwithlabormigration,"remittanceshavebeencausingasilenteconomicrevolutioninBangladesh.”Thecountryisexpectedtoreceive15.05 billion in 2014, enough to retain theeighth position it held last year, says the WB's Migration and Remittance Unit.
Driving Forces of Remittance Inflow in Bangladesh: An Empirical Study
International Journal of Economics and Finance, 2015
This paper empirically investigates the major driving forces of remittance inflow in Bangladesh. Using annual data over the period from 1977 to 2011 the paper concludes that gross domestic products of host country and domestic country, exchange rate, petroleum price and skill of labour significantly influence remittance inflow in Bangladesh. One finding of the research is that skilled labour force rather sends smaller amount of remittance to the home country than the unskilled labour. This is due to the fact that skilled people do not maintain close tie with the home country because they often take their families with them to foreign countries where they work. Because of narrow opportunities, unskilled labour cannot take their families with them and hence send money to their families. The study also identifies the reason behind migration of manpower from Bangladesh to foreign countries. Presence of surplus labour, slim job opportunity, unfavourable working environment, poor wage rate, inadequate social security and political instability largely induce people to migrate abroad.
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A Study on Performance and Challenges of Remittances Inflows in Bangladesh
Quddus, M. and Khan, F.C. (ed.) Bangladesh Economy in 21st Century, Chapter 8, Dhaka: University Press Ltd., Bangladesh., 2011
Bangladesh witnessed a surge in remittances inflow since 2002, especially as measures had been taken to encourage remitters to send their money through official channels. The multi-faceted benefits generated from remittances include increasing the living standards of recipient households, easing national saving-investment and exports-imports gap, and the building up of foreign exchange reserves. Reaping continuous benefits from remittances depends on addressing two key issues, namely increasing number of remitters, particularly skilled and professionals and maintaining the sustainability of remittances inflow. Though the remittances inflow into Bangladesh is increasing and is proportionate to the growth in world remittance flows, continued increases are not guaranteed. This paper attempts to analyze the present performance of remittances inflows in Bangladesh as well as investigate the challenges in the acceleration of remittances inflows. The paper also suggests coherent policies that can facilitate smooth emigration, ensure sustainable remittance inflow and divert a significant share of received remittances into productive sectors aiming at achieving higher growth, generation of employment, and alleviation of poverty.
The macroeconomic determinants of remittances in Bangladesh
Bangladesh. Various regressions in the paper find that the macroeconomic variables such as inflation, interest rate, exchange rate of Bangladesh and GDP of the five remittance sending countries have significant impact on remittance. In the analysis it is found that if the domestic interest rate goes up by 1%, on average, then the remittance will increase by 1.94%. Therefore, remittance in Bangladesh is very responsive to changes in the domestic interest rate. Again, if the GDP of the rest of the five countries increases by 1%, then remittance will increase by 3.06 % *The author is a Senior Research Associate at
Remittance and Its Impact on the Economy of Bangladesh
Education Times
With the increasing demand for its workforce from abroad, the remittance inflow in the economy of Bangladesh is enormously flowing every passing year. The multifold ensuing development impact on the economy includes reducing poverty, helping in maintaining the balance of payment, increasing foreign exchange reserves, and enhancing national savings. The relative weight of remittances has also increased against most macroeconomic variables alongside the contribution to GDP. Additionally, Remittances have helped improve the social and economic indicators like nutrition, living condition and housing, education, health care, social security, and investment activities of the recipient households. Keywords: Remittance, macro, economy, Bangladesh
Chittagong University Journal of Business Administration, 2011
Migration and Foreign inward remittances are vital and common phenomenon in the economy of Bangladesh. The role of remittances in the socioeconomic development is gradually being recognized by the policy-makers of the country. Foreign inward remittance is lessening Bangladesh's trade deficits, resulting surplus in current account balance. Foreign remittances also increase a country's international creditworthiness and lead to lower borrowing costs. If financial institutions can securitize remittance deposits they can increase their access to and participation in international capital markets, thus enhancing the home country's integration in such markets. This paper explores the impacts and present scenario of migration and remittances towards the economic development. The paper also focuses some policy measures for increasing the inward foreign remittances and their proactive employment so as to enhance their contribution to the development.
Macroeconomic Factors Influencing Foreign Remittances: The Case of Bangladesh
This paper examines the influence of few selected macroeconomic factors which are assumed to have influence on the flow of foreign remittances in Bangladesh. Yearly data between 1976 and 2011 have incorporated and a multivariate time series regression model have been designed to estimate the absolute relationship between remittances and macroeconomic determinants. It has found that professional and unskilled migrant have very low negative but significant regression coefficients but semi-skilled migrants have positive significant coefficient. Among other macroeconomic factors deposit interest rates and foreign exchange rates are also found to have statistically significant coefficients. Test of Granger causality reveals that foreign remittances have bi-directional causality with semi-skilled and un-skilled migrants and have uni-directional causality from professional migrants to remittances and remittances to DSE all share price index. However, extensive investigation is very essential to identify other macroeconomic factors that might cause the flow of foreign remittances in Bangladesh.