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The Global Financial Crisis and Workers' Remittances to Africa: What's the Damage?


  • Adolfo Barajas
  • Ralph Chami


  • Connel Fullenkamp
  • Anjali Garg


We estimate the impact of the recent global economic crisis on remittances into Africa for the period 2009-2010. Interestingly, the majority of remittances seem to flow within the African continent. The magnitude of the forecast decreases in remittance flows into African countries varies between 3 and 14 percentage points. African migrants to Europe will be hardest hit while migrants within Africa will be least affected by the crisis. We estimate the impact of the drop in remittances on home country GDP. For countries where the ratio of these flows to home country GDP is high, GDP is expected to drop by almost 2 percent for 2009. The negative effect of the crisis, however, is likely to be short-lived, as host country income is likely to rise in 2010 for virtually all African remittance-recipient countries.

Suggested Citation

  • Adolfo Barajas & Ralph Chami & Connel Fullenkamp & Anjali Garg, 2010. "The Global Financial Crisis and Workers' Remittances to Africa: What's the Damage?," Journal of African Development, African Finance and Economic Association, vol. 12(1), pages 73-96.
  • Handle: RePEc:afe:journl:v:12:y:2010:i:1:p:73-96

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    References listed on IDEAS

    1. Parsons, Christopher R. & Skeldon, Ronald & Walmsley, Terrie L. & Winters, L. Alan, 2007. "Quantifying international migration : a database of bilateral migrant stocks," Policy Research Working Paper Series 4165, The World Bank.
    2. Nicholas P. Glytsos, 2005. "The contribution of remittances to growth: A dynamic approach and empirical analysis," Journal of Economic Studies, Emerald Group Publishing, vol. 32(5), pages 468-496, October.
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    Cited by:

    1. Yaw Nyarko, 2014. "The Returns to the Brain Drain and Brain Circulation in Sub-Saharan Africa: Some Computations Using Data from Ghana," NBER Chapters,in: African Successes, Volume II: Human Capital, pages 305-345 National Bureau of Economic Research, Inc.
    2. Bentour, El Mostafa, 2013. "Should Moroccan Officials Depend on the Workers’ Remittances to Finance the Current Account Deficit?," MPRA Paper 52290, University Library of Munich, Germany, revised 01 May 2013.
    3. Francis M. Kemegue & Emmanuel Owusu-Sekyere & Reneé van Eyden, 2011. "What drives remittance inflows to Sub-Saharan Africa: A Dynamic Panel Approach," Working Papers 262, Economic Research Southern Africa.
    4. Nusrate Aziz & Arusha Cooray & Wing Leong Teo, 2017. "Do immigrants’ funds affect the exchange rate?," Discussion Papers 2017-13, University of Nottingham, GEP.
    5. Sanket Mohapatra & Dilip Ratha, 2010. "Forecasting migrant remittances during the global financial crisis," Migration Letters, Transnational Press London, UK, vol. 7(2), pages 203-213, October.
    6. Deodat E. Adenutsi & Meshach J. Aziakpono & Matthew K. Ocran, 2011. "The Changing Impact Of Macroeconomic Environment On Remittance Inflows In Sub-Saharan Africa," Journal of Academic Research in Economics, Spiru Haret University, Faculty of Accounting and Financial Management Constanta, vol. 3(2 (July)), pages 136-167.
    7. Nyamongo, Esman Morekwa & Misati, Roseline N. & Kipyegon, Leonard & Ndirangu, Lydia, 2012. "Remittances, financial development and economic growth in Africa," Journal of Economics and Business, Elsevier, vol. 64(3), pages 240-260.
    8. Abida Zouheir & Imen Mohamed Sghaier, 2014. "Remittances, Financial Development and Economic Growth: The Case of North African Countries," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 17(51), pages 137-170, March.
    9. Ibrahim Sirkeci & Jeffrey H. Cohen & Dilip Ratha, 2012. "Migration and Remittances during the Global Financial Crisis and Beyond," World Bank Publications, The World Bank, number 13092.
    10. Renee van Eyden & Emmanuel Owusu-Sekyere & Francis Kemegue, 2011. "Remittance Inflows to Sub-Saharan Africa: The Case of SADC," Working Papers 201127, University of Pretoria, Department of Economics.
    11. Adams, Samuel & Klobodu, Edem Kwame Mensah, 2016. "Remittances, regime durability and economic growth in Sub-Saharan Africa (SSA)," Economic Analysis and Policy, Elsevier, vol. 50(C), pages 1-8.

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    Remittances; Africa; economics; financial crisis;


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