Workers’ Remittances pile up to $26.7 billion as positive trends continue in May

KARACHI: Workers’ remittances continued their exceptional streak in May 2021, remaining above $2 billion for a record 12th straight month while in 11 months of FY21 inflows amounted to US $ 26.7 billion showing 29.4% growth.

“On a cumulative basis, remittances surged to US $ 26.7 billion during July – May Fiscal Year 2020-21, higher by 29.4 percent over the same period last year, ” said a statement issued by State Bank of Pakistan on Thursday, adding that Remittances during the first eleven months of FY21 had already crossed the full FY20 level by $3.6 billion.

Record high inflows of workers’ remittances during FY21 have been driven by proactive policy measures by the Government and SBP to incentivize the use of formal channels, curtailed cross-border travel in the face of COVID-19, altruistic transfers to Pakistan amid the pandemic and orderly foreign exchange market conditions.

Remittance inflows during July-May FY21 were mainly sourced from Saudi Arabia ($7.0 billion), United Arab Emirates ($5.6 billion), United Kingdom ($3.7 billion) and the United States ($2.5 billion).

Remittances received during May 2021 amounted to US $ 2.5 billion, 33.5 percent higher than the same month last year. These were also higher than the monthly average of US $ 2.4 billion during July-April FY21.

On a month-on-month basis, workers’ remittances fell by 10.4 percent in May 2021 compared to April 2021, the central bank noted while terming it an expected decline as remittances usually slow in post Eid-ul-Fitr period. As Eid fell in mid-May 2021 with markets closed a week earlier, there was some front-loading of remittances in April 2021, it further explained.

However, the seasonal decline in May 2021 was less the half the average decline observed during FY2016-2019. In FY2020, remittances experienced an exceptional rise due to the easing of Covid-19 lockdowns in the post-Eid period in Gulf countries, the spokesperson observed.