DECLINING remittance by expatriate workers has hit the lowest in 2017 at $13.53 billion down from 15.32 billion in 2015. Many have blamed higher value of taka against dollar for the fall in remittance saying many expatriates were diverting money through informal channel to get better value back home in term of local currency. It is a mater of alarm that remittance declined steadily over last year to a six-year low but question arises what the government has done to arrest the downward trend. Bangladesh economy is badly dependent on such remittance. There is no secret that people are diverting much of the fund from banking channel.
Another point needs attention is that currency market is getting overheated over the past few months as dollar prices peaked. Why so much rush for dollar is a big question as demand for dollar increases when capital flight soars. Low remittance has also link with capital flight. What is surprising value of taka depreciated starting last year to mean a dollar will get more taka now in local currency at home. But remittance still declined instead of bouncing back to add to the suspicion that people are diverting fund it to third country destinations. In local currency Dollar now sells at Tk 82.70 and one may hope the situation should improve.
However many analysts believe expatriates income in their host countries such as Saudi Arabia and UAE has sharply declined over the past years to cause a slow down in remittance. Most Middle East countries are suffering from recession due to fall in oil revenue and increase in security expenditure by cutting development spending. Saudi’s defense spending has increased manifolds due to war in Yemen. Qatar is facing blockade slowing down business activities including earning by expatriate Bangladeshi nationals. Many factories have laid out workers in Saudi Arabia in these years; many have failed to pay back arrears to their workers. Too much concentration of expatriate workers in Middle East countries has a reverse spilling over impact on remittance.
Need to be mentioned that Bangladesh should diversify manpower exports to newer destinations like East Asia and South Africa where the economy is in good shape and growing well. Meanwhile the biggest attention must go to plugging the loopholes in remittance way. It is no secret that private persons in the Middle East are also engaging in remittance collection at a higher rate to expatriates’ families back home using the money for illegal imports by third parties.
People with Bangladesh origin deposited more money last year to Swiss Banks than many others and it just shows money is going out instead of coming into the country. Dubai police last year arrested several Bangladeshi shop owners on charges of taking remittance money out of banking channel and use of mobile phones determining the destinations of such money. We believe our government should coordinate actions with host countries to check such frauds. We can’t allow here anything wrong.
