Thursday, January 31, 2013

Migrants' transfers three times more than aid budgets

From The Guardian "The amount has tripled in a decade and is now more than three times larger than total global aid budgets, sparking serious debate as to whether migration and the money it generates is a realistic alternative to just doling out aid. If remittances at the level recorded by the World Bank were a single economy, it would be the 22nd largest in the world, bigger than Iran or Argentina."
The real figure may be larger since many bypass banks and transfer companies from which the data is recorded by the World Bank. The transfer companies swallow quite a bit of money "At present, the average fee is about 9%, meaning an average of $18 for every $200 sent, but in some parts it tops 20%." I find that in transferring money to India by banks, about three banks, one here and two in India have been charging money, but overall it came to about six percent for a transfer of a thousand Australian dollars. For smaller amounts, the percentage gets higher.

Duncan Green reviewed a book "a distillation of 6000 interviews carried out from 2005-9 with people who have received or been involved in aid......And it’s an uncomfortable read: it had me squirming on multiple levels, because of its highly convincing criticisms of the aid business, the crassness of its generalizations, and its tendency to suggest what we already know to be true (and are trying to put into practice), not to mention wondering whether my negative reactions were just defensiveness. But the book’s origins – giving a voice to those on the receiving end of aid – means it is particularly worth reading, and some of it is unexpected and (I think) new."
Possibly, the aid by the kith and kin gets closer to the real needs of the recipients.

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