Bangladesh must maintain the pace of increased remittances inflow

A major contributor to Bangladesh’s GDP, remittance has long been a pillar of the country’s steady economic growth and resilience. Remittance or expatriate income is currently in the best position among the primary indicators of the nation’s economy. After continuing to expand in August and September, the remittance inflow is gaining significant traction in October as well, indicating not just the expatriate community’s tenacity but also their restored faith in the economic security of their country.

Consequently, as political stability in Bangladesh drew nearer every day, expatriate income began to rise steadily. Remittance inflow rose to USD2.22 billion in August, a 39 per cent year-on-year rise.  Around USD2.40 billion were remitted via legitimate procedures last September. The sum is 28,857 crores TK in local currency. This is the second-highest monthly inward remittance in four years. According to Bangladesh Bank’s weekly statistics, which was made public on 14 October 14, over the first 12 days of this month, migrants sent almost $1 billion ($986.6m)via banking channels.

The current rise is mostly ascribed to foreigners using official banking channels, which is excellent news for our country since it indicates that expatriate workers are now more confident in Bangladesh’s enhancing financial systems. With an emphasis on encouraging sustainable growth and legal remittance flows, financial institutions and organisational economic programmes must seek to investigate ways to boost foreign earnings and persuade expatriates to use legal channels, which would further boost the economy. Undoubtedly, remittances contribute significantly to the country’s overall economy by generating a sizable amount of foreign exchange. Needless to add, the interim administration must continue to give top priority to programmes that promote the growth of remittances.

Making it more feasible for remitters to send their money through legal channels and streamlining remittance transfer procedures are two examples of this. It is encouraging for our economic recovery and resilience that inbound remittances continue to rise. Remittance inflow can assist in addressing the economic difficulties and challenges facing the interim administration. However, this steady rise in remittances coincides with a pivotal moment in our economic history; the interim administration has been entrusted with managing a complicated environment, with economic difficulties ranking among the most pressing issues. The possibility of ongoing remittance inflows might offer Bangladesh a timely and much-needed buffer against the uncertainty brought on by the recent political upheaval.

The expansion of these inbound remittances has resulted in a steady increase in forex reserve. The country’s declining reserve and growing inflation are still problems. Remittances are a lifeline in this situation; in addition to giving numerous families in the nation the support they need, they also significantly contribute to strengthening foreign exchange reserves, which helps the country's already unstable economy. Remittances have a wide range of functions and significance, both directly and indirectly.

By raising living standards, building infrastructure, promoting savings, and making investments in a variety of sectors, this remitters not only help their families but also significantly contribute to the nation’s economic growth. An essential component of South Asia’s 2nd largest economy’s economic mobility is remittances.

The government and financial institutions, therefore, must keep improving the banking channels available for remittance payments. It must concentrate on promotional activities to increase inward remittances, encourage remitters through various stimulus measures, strengthen Bangladesh’s international brand, highlight the skill development of aspirant migrant workers, locate and find new potential labour markets, and enhance diplomatic efforts with prospective nations. However, in light of the recent Gen-Z revolution, remitters have a moral obligation to support economic stability.

Of course, it is crucial that Bangladesh looks after its expatriate workers, as has been said many times by many economists. The government must do a better job of protecting migrant workers rights once they are in these foreign markets and providing them with all the support they need, in addition to funding skill development programmes for prospective migrant workers to increase the number of high-income expat workers who can land better-paying jobs abroad. Under the interim government, Bangladesh is enduring a particularly difficult transition moment. It is impossible to overestimate the significance of sustained remittance growth at this point.

South Korea, Malaysia, Japan and some countries of the Middle East, Europe and Africa have already shown strong interest in increasing the number of Bangladeshis. It is the government’s responsibility to continue looking for new ways to achieve this goal. Many nations are in dire need of workers of all stripes.

One of Bangladesh’s most important resources is its workforce, yet there is still much space for development. Since the majority of our foreign workers are now rather unskilled, it is imperative that they be equipped with the necessary skills. In the end, extending the reach of our migrant labour is beneficial for a nation that is quickly becoming a major player in the international arena. Bangladesh must, therefore, maintain the pace of the recent increase in inbound remittances.

The writer is the DG, International Mother Language Institute, Dhaka

Source: Daily Sun.