31 August 2020 09:30 am
Worker remittances rose in July continuing its ascendency for the third month in row after the coronavirus pandemic put a damper on the key foreign exchange income to the country, which helps a great deal to ward off serious challenges in the external sector.
The remittance income from the Sri Lankan migrant workers in July was recorded at US$ 702.1 million, up 12.2 percent or from Rs.625.7 million recorded in the corresponding month in 2019.
In June the country received US$ 572.5 million in remittance income, logging the first uptrend after the coronavirus induced lockdowns dimmed expectations for worker remittances.
With the latest numbers out for July, Sri Lanka has received a total of US$ 3,681.7 million for the first seven months from migrant Sri Lankan workers, down 5.5 percent from the comparable period in 2019.
Sri Lanka received remittance income of US$ 3,895.4 million during the first seven months in 2019.
However, Sri Lanka expects a 14.6 percent decline in worker remittance income for 2020 as the Central Bank for the first time announced their re-visited estimates for the key current account income, which for the most part helps fund imports and salvage the balance of payments in the country.
Sri Lanka in 2019 received US$ 6.7 billion as worker remittances.
Despite the two consecutive months of increase in worker remittance income, it is yet uncertain if the trend would continue as heightened health hazard in the host countries have prompted a section of Sri Lankan migrants to return while new job aspirants have also seen a decline.
However, the returnees as well as less migration could bode well for domestic industries, hamstrung by dearth of workers.
Nevertheless, it remains a challenge to create opportunities for these returning workers, ensuring them with a living wage and decent working conditions, which are either better or comparable with the standards in foreign countries.
However, in the near term, the fall in worker remittances could strain the incomes and consumption levels of those families who are dependent on migrant workers, and thereby the growth in the economy.
In any case in the medium term, the State needs to take up the cudgels to skill and re-skill the workforce and to provide incentives to build industries that can employ these people.