Economy & Trade, Health

‘Declare remittance as an essential financial service’

UK and Switzerland say in a joint statement

The image shows the countries from which remittance flows to Bangladesh, a service that is severely affected by the coronavirus outbreak.

May 25 2020 - The UK and Switzerland are calling for greater global collaboration to ensure access to digital remittance services to support people during the coronavirus outbreak.

Such remittance accounts for more than five percent of the GDP in at least sixty developing countries. The World Bank predicts remittances to low- and middle-income countries will fall by 20 percent or $110 billion in 2020.

In a joint press statement, the two European countries said it is important to make sure diaspora communities around the world can continue to send financial support to their families.

The call is important for Bangladesh. A country that heavily depends on migrant remittance, which was $18 billion last year and is likely to decline by 22 percent this year. Also, several lakh Bangladeshi migrants may return home after facing job losses, while those aspiring to find jobs abroad may also not see the dream come true any time soon.

The joint statement issued on Friday highlighted the urgent need for people to be able to continue accessing money transfer services, and for governments to make sure those funds reach those relying on this support.

Both UK and Switzerland are also urging countries to support greater access to digital remittance services and to declare remittances an essential financial service. They are also encouraging remittance service providers to reduce costs and fees for people making payments.

Money sent by individuals to family and friends living in low- and middle-income countries totaled $554bn in 2019 and is a vital lifeline in many developing countries, boosting economic development and lifting people out of poverty.

But coronavirus is already having a big impact, with a drop in the wages of migrant workers and coronavirus restrictions making it more difficult for people to access money transfer services.

A drop in remittance would have a severe impact on countries where many people are already facing destitution and even starvation as a result of the huge economic impact of the pandemic.

UK’s International Development Secretary Anne-Marie Trevelyan said, “The coronavirus pandemic means we are all concerned about how our family and friends here and overseas are coping. That’s why we’re making it easier for diaspora communities in the UK and other countries to continue to transfer money to their relatives.”

“This will be lifesaving for some families in developing countries where coronavirus is making a lack of food and healthcare, and extreme poverty, even worse. We are helping to prevent fragile economies from facing potential collapse during the pandemic.”

Federal Councillor Ignazio Cassis, head of the Swiss Federal Department of Foreign Affairs added.

“Remittances are important, but difficult because of COVID-19. So, let’s make sure those barriers are removed worldwide! New technologies can help us here.”

The joint call was backed by partners, including the World Bank, the UN Capital Development Fund, UN Development Programme and the International Organisation for Migration. A number of countries have already joined, including Ecuador, Egypt, El Salvador, Jamaica, Mexico, Nigeria and Pakistan.

The UK government has made it clear that in the UK people can continue to visit remittance centres should they need to, while observing social distancing and staying safe. Digital money transfer services are also available.

This story was originally published by The Daily Star, Bangladesh

 
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