Thursday, 16 September 2010

SRI LANKA: The impact of remittances on financial development

Maria Soledad Martinez Peria

Remittances, funds received from migrants working abroad, to developing countries have grown dramatically in recent years from U.S. $3.3 billion in 1975 to close to U.S. $338 billion in 2008.

They have become the second largest source of external finance for developing countries after foreign direct investment (FDI) and represent about twice the amount of official aid received.

Relative to private capital flows, remittances tend to be stable and increase during periods of economic downturns and natural disasters. Read more

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