Home Business Zimbabwe diaspora remittances overtake foreign aid

Zimbabwe diaspora remittances overtake foreign aid

Diaspora remittances

Zimbabwe diaspora remittances overtake foreign aid. Diaspora remittances have overtaken foreign aid, as Zimbabweans abroad sent home over US$1 billion in 2020, the highest ever contribution made to the local economy, Finance and Economic Development Minister, Professor Mthuli Ncube said.

The remittances surpassed the previous year’s amount of US$635.7 million, exceeding projections made by the Reserve Bank of Zimbabwe which had projected to receive US$940 million by year end.

“It has gone very well for us in terms of remittances from our own Diaspora abroad. Whereas you know, last year, we received something like US$1 billion, which is a record inflow,” said the finance minister while addressing journalists in Bulawayo over the weekend.

Prof Ncube cited that the increase was possibly due to use of formal channels that remained operational during the Covid-19 pandemic, which had introduced lockdowns in most countries and closed certain sectors.

“Maybe some of it has to do with the fact that, you know, the Diaspora had to use formal channels (of sending money) because of Covid-19. So, we saw maybe an increase due to that. But really, that just shows you it is a steady inflow of external resources into the economy and is targeted to families for investment. So it’s a good amount of influence,” he said.

The finance minister added that remittances were also on the rise in other African countries and importantly had overtaken foreign aid.

“In fact what is happening all over Africa is that diaspora remittances have overtaken foreign aid. In almost all countries, remittances have overtaken foreign aid as the largest inflow into the economy to support vulnerable families, because that’s what the Diaspora do, they support their families,” Prof Ncube said.

In terms of the remittances considered as a form of aid, they had become the largest form of aid into any economy, noted the finance minister.

“And Zimbabwe is such a good example, right. And that’s something that cuts across Africa at large. So that’s basically some of the highlights of our economy,” he said.

In 2019, total remittances totalled US$1.15 billion, with non-governmental organisations remittances contributing US$519.49 million.

Leader of the African Diaspora Global Network, a migrant-rights organisation based in South Africa, Dr Vusumuzi Sibanda, said these statistics indicated how much people in the Diaspora worked hard to support their families back home.

“Most of the households now have at least one sibling or relative in the Diaspora, and as a sign of Ubuntu, they have to send help back home. They have to because the Zimbabwean economy is harsh for locals, which is reason why people seek greener pastures elsewhere,” he said to CITE in an interview.

“In as much as we praise those in the Diaspora, it’s sad that Zimbabweans now have to survive on money coming form outside. This also shows how hard it is for migrants who have to work hard , some having several odd jobs to make ends meet.”