Following the economic slump that the United States is facing at the moment, the World Bank has urged governments and remittance service providers to put in place a new set of measures to facilitate to the Latin American countries. It has recommended measures like increasing competition and transparency among service providers to reduce the cost of remittance transfers and increasing access to banking services among the migrants and the beneficiaries.
According to a new World Bank report the money that overseas workers remit back home is linked to lower poverty levels and improvements in education and health indicators. Remittances are also contributors to higher growth and investment. In this regard it becomes important to see how the developing countries cope with the present scenario. Remittances to Latin America grew only 6 percent in 2007, compared to an annual average growth rate of 19 percent between 2000 and 2006 this is a clear indicator of the impact of the US recession fears in the Latin American countries.
The World Bank is putting emphasis on improving the banking system and keeping the remittances as hassle free as possible. Economists feel that remittances may lead to an appreciation of the exchange rate, potentially reducing the international competitiveness of the respective economies. It is thus important to ensure that the remittances are put to practice more effectively.
Tags: Remit2Home, remittances, World Bank
