These reversis of migrants in countries of their origin – in English money transfers – are the most important source of money for low income countries. 857 billion US dollars transferred people to their families or acquaintances abroad in 2023, according to the World Bank. Most, 656 billion dollars, went to countries with average or low income. The amount is greater than all foreign investments and development funds that went to these countries in the same year.
In fact, the numbers for money transfers are likely to be much higher, since the data is often bad, the World Bank also writes. Especially banknotes that are delivered directly when traveling under the radar.
“The profitability makes an important contribution to maintaining the existence of many people and the support of the macroeconomic stability of countries -receiver,” says TAZ sensor. A person who claims to have only one name for sustainable development in the analytical center of the Southern Center in Switzerland.
No more than 3 percent of the costs
The importance of repeated analysis has already been discussed at the first conference on development financing in 2002 – in order to reduce costs. For 17 purposes in the field of sustainable development (Tsur), which the United Nations states were determined in 2015, the project became specific: the costs of transfers should not be more than 3 percent.
However, in the fourth quarter of 2023, they were more than two times higher, on average 6.4 percent of the amount sent, according to the World Bank, cost $ 200. US President Donald Trump puts one more in the first place: in his controversial budget law – a “large beautiful bill”, he plans an additional tax of 3.5 percent for all money transfers abroad.
This week, states are found at the fourth conference of the UN to finance development in Seville. Danish hopes that the topic here will become more focusing. “The states must double their efforts to reduce the costs of reverb.” In the end, the goal is confirmed in the final design of the final document. Danish would like to fulfill specific obligations, for example, to abandon additional taxes and facilitate a course for local transfer suppliers.
According to Denmark, high costs are still an important obstacle to return. Over the past ten years, minor improvements have occurred. In 2015, the costs were an average of 7.7 percent, that is, 1.3 percentage points higher than today. The reason for a slight cost reduction is a wider offer of online transmission services, which are on average much cheaper than ordinary banks.
According to Denmark, there are good arguments for cheaper changes: “Funds go directly to people they need the most.” This means that less this is “lost” than with other methods of financing development. Most of the transfer of the transfer will be invested in local markets again. Food in poorer countries will be bought, in countries with an average income, funds also go to the building of the house, explains Denmark. A lot of money also flows into healthcare and education.
Translations are also sources of income for countries -recruitors for foreign currencies. Danish criticize that loan rating agencies do not include them in the rating of the country’s ratings. It would also be a problem for Seville.
