MOGADISHU —<\/b>\u00a0 Global remittances to Sub-Saharan will decline by 23% in 2020 owing to COVID-19 impact adversely affecting countries such as Somalia which heavily rely on monies from relatives and friends abroad.<\/p>\n
The World Bank said in a study Wednesday the COVID-19 pandemic will see close to $10 billion in form of remittances to Sub-Saharan Africa wiped out by a combination of factors driven by the corona outbreak in key destinations where African immigrants reside.<\/p>\n
\u201cDue to the COVID-19 crisis, remittance flows to the region are expected to decline by 23.1 percent to reach $37 billion in 2020, while recovery of 4 percent is expected in 2021,\u201d the global lender said noting the region witnessed a paltry 0.5% decline of remittances in 2019. Remittances to Sub-Saharan Africa in 2019 stood at $48 billion.<\/p>\n
The EU area, the US, the Middle East, and China which host the majority of African immigrants have been adversely affected by COVID-19.<\/p>\n
The U.S alone has recorded upwards of 850,000 cases while countries in the EU such as Italy and Spain have been seriously battered by the pandemic.<\/p>\n
Remittances from Somalis abroad account for about 23% of the country\u2019s GDP with approximately $1.4 billion arriving in the country annually.<\/p>\n
World Bank President David Malpass said warned the pandemic could cripple low-income economics and families which rely on remittances.<\/p>\n
\u201cThe ongoing economic recession caused by COVID-19 is taking a severe toll on the ability to send money home and makes it all the more vital that we shorten the time to recovery for advanced economies,\u201d said Malpass.<\/p>\n
The World Bank, however, notes despite the decline, remittance flows are expected to become even more important as a source of external financing for low and middle-income countries (LMICs) as the fall in foreign direct investment is expected to be larger (more than 35 percent).<\/p>\n