Pakistan`s receipts from remittances tripled between 2001 and 2003: World Bank
ISLAMABAD, Apr 21: Pakistan's receipts from remittances tripled between 2001 and 2003, said World Bank report on
"Global development finance 2004". According to the report in South Asia, worker's remittances brought in
US $ 18.2 billion to the region in 2003, as compared to $ 13.1 billion in 2002. It added that a significant and growing
new source of capital for developing countries is remittances sent home by migrants working in rich countries, which
have climbed steadily since 1998, reaching $ 93 billion in 2003,up 20 percent from 2001. They are now the second most
important financial low to developing countries after Foreign Direct Investment (FDI) and represent almost double the
flows of official aid, the report added. The increase in the capital flows, the report said reflects improved global
economic growth, which rose from 1.8 percent in 2002 to 2.6 percent in 2003, and which is forest to jump to 3.7 percent
this year. The report further said that developing countries, as a group, grew by an estimated 4.8 percent in 2003, and
are expected to register 5.4 percent growth in 2004, which would surpass their previous 5.2 percent record high in 2000.
South Asia's GDP is bound to grow 7.2 percent in 2004, the annual World Bank report, Global Development Finance
2004 added. It said that propelled by rising consumer and investment demand and good rains in the region, South Asia
reached 6.5 percent growth in 2003. Worker's remittances and growing foreign direct investment are also
increasingly important factors in South Asia's growth and prospects, the WB report said. "Maintaining such
high levels of growth is possible," said Shantayanan Devarajan, Chief Economist of the South Asia Region at the
World Bank. The report further said that on the bright side, foreign reserves have more than doubled, with India and
Pakistan leading the region, thanks to sharply rising worker's remittances, foreign direct investment and portfolio
equity flows," Globally, the report noted that net private capital flows to developing countries as a whole
rebounded to $200 billion in 2003, up from $155 billion in 2002, but most of the increase is concentrated in just a few
relatively better-off countries, while official development assistance to poor nations increased only marginally.
"The rebound in capital flows to some of the larger countries is encouraging, and reflects an improving global
economic picture", said Francois Bourguignon, the World Bank's Chief Economist. "But we are concerned
about official aid flows, which are of critical importance to the poorest countries. They have increased only slightly,
and last year remained well below the levels required to achieve the Millennium Development Goals (MDGs)". The WB
report added that the increase in net private flows - bonds and bank loans- most of which went to Brazil, China,
Indonesia, Mexico and Russia, is the major factor in an overall increase in net capital flows to developing countries
from all sources, public and private, to $228 billion in 2003 from $190 billion in 2002. Net private capital flows rose
to all developing regions, except the Middle East and North Africa. These increases are due partly to low interest rates
in the industrial countries, and reflect a strengthening global economic recovery. They have also been prompted by
sounder fiscal policies in many developing countries, as well as structural reforms, mitt added.
(THROUGH ASIA PULSE)
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