Malawi has earned $73.48 million (about K54 billion) in personal remittances in five months from January and May this year, figures compiled by the Reserve Bank of Malawi (RBM) show.
The five-month figure is nearly double the $38 million (K27.7 billion) the country received last year through remittances, a feat RBM spokesperson Mbane Ngwira attributes to a number of initiatives instituted to increase remittances—money expatriates send to their country of origin via wire, mail or online transfer.
Before November last year, figures show that remittances amounted to around $1.4 million (K1.4 billion) per month, but the receipts have jumped to more than $17 million (K121.1 billion) a month.
In an interview on Friday, Ngwira said the Malawi Government has been on a vigorous campaign to increase remittance payments to Malawi; hence, the significant jump.
“Recently, the Ministry of Foreign Affairs and RBM teamed up and visited Malawians in the diaspora and discussed issues relating to money transfers and the current figures show that people have responded to the calls positively.
“We are also in the process of putting up a web portal to record the number of Malawians in the diaspora. We also have in place Malawi Diaspora Engagement Policy. We are, thus, targeting remittances to reach $200 million [K147 billion] this year,” he said.
The $200 million target is more or less what the country earns in a year from tobacco, hitherto the country’s main foreign exchange earner.
With about 40 percent of budget support cut since 2013 and tobacco earnings reduced by half over an eight-year period, Malawi needs all the foreign exchange it can get; hence, the drive to increase remittances.
The rise in remittances is similar in other African countries with World Bank figures showing that remittances to sub-Saharan Africa grew to $37.8 billion in 2017 and are forecast to rise to $39.2 billion and $39.6 billion in 2018 and 2019, respectively.
Since 2010, international migrant population numbers from Africa have grown significantly such that eight in 10 of the fastest-growing migrant populations are from African nations, according to a Pew Research Centre analysis of the latest United Nations (UN) data on the number of people living outside their country of birth.
Meanwhile, the United Nations (UN) specialised agency for postal sector has announced plans to lower the cost of remittances flowing into Malawi just like the rest of the continent.
Ngwira has since welcomed the development, admitting that current costs of remitting funds are high and currently a concern.
He said: “Sending money back home comes with a cost and has been an issue, but plans to lower the cost of remittances will boost export proceeds from services offered by the citizens in the foreign lands and can therefore be used for development.
“Unlike foreign loans, these funds will not be repaid. It, therefore, forms a vital and critical form of funding available to the economy.”
Ministry of Finance, Economic Planning and Development spokesperson Davis Sado earlier said there are various policies and strategies to woo more Malawians living abroad to regularly remit home significant amounts of foreign exchange.