RemittancesGateway.org

Bangladesh remittances up 20 pct in 2009 yr/yr

Tuesday, 05 January 2010 13:35

Source: Reuters
By: Serajul Islam Quadir

Bangladesh received $10.72 billion in remittances from workers overseas in 2009, up about 20 percent from a year earlier, the central bank said on Tuesday.

In 2008, remittances totalled $8.97 billion.

"Remittances grew as the expatriates sent more money through formal channels during the past year because they felt it safer," said Allah Malik Kazmi, senior consultant of the central bank.

"They considered that investing the hard-earned money in their own country was more profitable than keeping it outside," he told Reuters.

Kazmi said the global financial crisis had encouraged Bangladeshi expatriates to send more money home as they lost confidence in depositing their cash with foreign banks.

Remittances are a key plank of the country's economy. Millions of Bangladeshis are dependent on money sent by relatives working overseas, mainly in the Middle East, Europe and the United States.

Remittances from more than 6 million expatriates account for 10 percent of the country's economy, and are the second-biggest source of foreign income after ready-made garments, which earned more than $11 billion in the 2008/09 fiscal year, that ended in June.

At the end of December, Bangladesh's foreign exchange reserves surged to an all-time high of about 10.40 billion, following a steady rise since February 2009 on higher remittance inflows.

The World Bank, International Monetary Fund and Asian Development Bank had earlier warned that growth in remittances could slow in the 2009/10 fiscal year (July-June) as recession hit many of the country's major markets.

($1=69.27 taka)