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Africa Remains Poor Despite Huge Money Transfers – Expert 

The Executive Director of the Institute of Financial Development Studies, IFIDS, Simon Awanchiri, expressed this regret in a press conference on February 10 in Yaounde.
While announcing that IFIDS would be charting different strategies to reverse this ailing economic paradox in Yaounde from November 23 to 25, Awanchiri said Africa only receives a circa seven percent of the global volume of remittance flow.

The meeting dubbed Remittance International Conference will be organised by IFIDS in partnership with Cameroon’s Ministry of Finance African. Quoting a World Bank study, Awanchiri said a staggering US 250 billion dollars came into developing countries in 2006.

He expressed regret that Africa, which is the poorest continent, receives only seven percent.  
"Even then, the absolute amount that Africa receives as remittance is not insignificant and is estimated at over US 20 billion that is equal to FCFA 10 trillion in 2006," he remarked.
Even with such a huge amount of money, Awanchiri said Africa has not been able to systematically mobilise the resources for the continent’s economic development.
The bane of progress here, he emphasized, is that almost 90 percent of the remittances received by Africa are spent essentially on social needs.

Hear him: "Remittances in our context, is the portion of migrant workers’ earnings which he or she sends home. I guess some of us here have been direct or indirect beneficiaries of remittances. It could be money sent home by a brother or sister who lives abroad for school fees or money to settle hospital bills, or funds for a family project or just money to help the family in essential daily expenses."

According to the IFIDS boss, remittances now surpass overseas development aid and Foreign Direct Investment but have ironically brought no succour to Africa’s economic development endeavours. That is why,  he stated, the conference will not only focus on looking for ways of swelling Africa’s remittances, but would mobilise stakeholders to make sure that such resources trickle down to ensure the development of the continent.

Awanchiri disclosed that the Yaounde conference would bring together finance and development experts as well as actors of the money transfer sector from Africa, and the rest of the world to examine issues at stake. They would determine why Africa is not yet cashing in on this remittance opportunity. He said participants would be drawn from the public and private sectors.

Equally briefing journalists, a senior economic consultant, Lockna Djaobele, said remittances constitute a very important economic factor in the world. Quoting statistics, he said 10 percent of the world’s population benefit from money transfer, adding that of the world’s 150 million migrants, 30 million are Africans.

Besides, he said the banks get 10 percent of the profit from money transfers. Morocco, Algeria, Egypt, Tunisia and South Africa were cited as countries that receive the bulk of remittances in Africa, with countries in the central African region tailing the list. The conference therefore will provide a forum for stakeholders to reflect and take decisions to increase remittances in Africa as well as ensure that they are used as a tool for Africa’s economic growth.

The stakeholders are expected to create an enabling environment for remittances to skyrocket from seven percent to 40 percent of global transactions in 2012. Going by another consultant, Fru Asanji, remittances will be of more economic value that the money migrants send to their families from abroad would be enough to be invested rather than just for consumption.

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