Remittances: an Important Source of Income for South Asian Countries

CEIC Macro Watch Global #44 - May 29, 2015 Bangladesh, Pakistan, Sri Lanka and Nepal rely heavily on workers’ remittance inflows as one of their most important sources of earnings. Remittances are the largest form of external receipts for Nepal, and the second largest for Bangladesh, Pakistan and Sri Lanka after merchandise (goods) exports. The large external receipts from remittances are helpful for financing the merchandise trade deficit in all four of these South Asian economies. Remittances accounted for 207.4% of the merchandise trade deficit incurred by Bangladesh in the fiscal year ended June 2014 (FYJune2014). In Pakistan the ratio amounted to 95.7% in FYJune2014, and in Sri Lanka and Nepal remittances were 84.7% (FYDec2014) and 91.3% (FYJuly2014) respectively. For the same period, current account balance-to-GDP ratios were considerably healthy (to varying degrees) for Bangladesh at +0.8%, Pakistan -1.3%, Sri Lanka -2.7% and Nepal +4.7%, despite merchandise trade deficits of respectively USD 6.8 billion (3.9% of GDP), USD 16.6 billion (6.7% of GDP), USD 8.3 billion (11.1% of GDP) and USD 6.1 billion (30.9% of GDP). By Woon Khai Jhek in Malaysia - CEIC Analyst Discuss this post and many other topics in our LinkedIn Group (you must be a LinkedIn member to participate). Request a Free Trial Subscription. Back to Blog
1st June 2015 Remittances: an Important Source of Income for South Asian Countries

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