Remittances are defined as the monetary transfers that a migrant sends to his or her country of origin or, in other words, financial flows associated with migration. Most remittances are personal cash transfers from a migrant worker or immigrant to a relative in the country of origin. Some scholars and academics go further to add transfers of skills and technology, as well as “social remittances” (Baruah, 2006, in OSCE, IOM, ILO, 2007). Over the years, remittances have contributed to the economies of many countries which have led to rapid development especially in the areas of infrastructure, family wellbeing, among others.
Remittances sent back home by migrants are a powerful financial force in developing countries. It is estimated that after foreign direct investment and trade related earnings, remittances form the largest financial flow to developing countries, often far larger than official development assistance (Castles and Delgado, 2008, page 222). According to the balance of payments data, total transfers to the Ghanaian economy ranged between US$ 400 million in 2002. Of the total transfers, private unrequited transfers, increased from US$201.9 Million in 1990 to almost US$ 680Million in 2002(Manuh, 2005).Read more
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