Worker remittances rebound in October

The earnings sent by Sri Lankans working aboard rebounded in October, ending a five-month declining streak, the data released by the Central 
Bank showed. 

Worker remittances are Sri Lanka’s largest foreign income earner, which along with tourism earnings bridge the negative balance in the current account.

Sri Lankan expats sent home earnings worth of US $ 599 million during October, which is an increase of 9.7 percent year-on-year (YoY), compared to US $ 538 million in the same month last year.

Consequently, the decline in cumulative worker remittances, which stood at 1.5 percent YoY up to September, has come down to 0.5 percent YoY for the first 10 months of the year.

The cumulative remittance earnings for the 10 months stood at US $ 5,876 million.

According to the latest edition of the World Bank’s Migration and Development Brief, the remittance inflow to Sri Lanka is estimated to grow by 5.4 percent YoY this year to US $ 7,579 million, which would be equivalent to 8.1 percent of the country’s gross domestic product. 

Remittances to South Asia are projected to increase by 13.5 percent to US $ 132 billion in 2018, significantly higher than the 5.7 percent growth seen in 2017.

However, the World Bank projected that the remittance growth for South Asian region would slow to 4.3 percent YoY in 2019, due to a moderation of growth in advanced economies, lower migration to the Gulf Cooperation Council (GCC) countries and the benefits from the oil price spurt dissipating.

The South Asian region has been experiencing a fall in migrant worker deployments since 2016, due to lower demand from the GCC, especially Saudi Arabia, due to nationalization policies.

Saudi Arabia remains as the largest source country for Sri Lankan migrant workers and for remittances. In 2017, US $ 2265 million worth of earnings were sent to Sri Lanka by Sri Lankan workers in Saudi Arabia. 

Meanwhile, tourism earnings improved marginally to US $ 284 million in October, compared to US $ 283 million in the same month, last year.
The tourist arrivals grew at the lowest pace in October this year, which was at 0.5 percent amid a decline in tourists arriving from China, Germany and France, compared to October 2017.

The cumulative tourism earrings grew by 10.6 percent YoY to US $ 3,496 million during the first 10 months of 2018, which is marginally lower than the 11.2 percent YoY growth in tourist arrivals during the same period. (NF)