The Global Crisis and the Impact on Remittances to Developing Asia

34 Pages Posted: 1 Jun 2010

See all articles by Shikha Jha

Shikha Jha

Asian Development Bank

Guntur Sugiyarto

Asian Development Bank

Carlos Vargas-Silva

University of Oxford

Date Written: December 1, 2009

Abstract

Remittances to Asia plunged during the 1997 Asian financial crisis, but the drop was temporary as the flows were increasing once again after just 1 year. The current crisis, however, is fundamentally different in that even the countries that send remittances have been adversely affected. The global nature of this crisis raises several questions such as whether it will also last for a short time or developing Asia should prepare for a long period of remittance stagnation. This study examines remittances data to several Asian countries to shed light on such issues. The results suggest that while remittance flows to key recipients in the region have slowed down in the current year, there has not been a sharp drop. Moreover, there is no indication that the remittance flows will slow down further, suggesting that the flows should be back on a higher growth path in a few years. It is unlikely, however, to see the same growth rates of the past, given that an important share of that growth during the last two decades was due to better recording of remittances and an increased use of wire transfers on the part of migrants.

Keywords: Global Crisis, Remittances, Asia

Suggested Citation

Jha, Shikha and Sugiyarto, Guntur and Vargas-Silva, Carlos, The Global Crisis and the Impact on Remittances to Developing Asia (December 1, 2009). Asian Development Bank Economics Working Paper Series No. 185. Available at SSRN: https://ssrn.com/abstract=1618088 or http://dx.doi.org/10.2139/ssrn.1618088

Shikha Jha (Contact Author)

Asian Development Bank ( email )

6 ADB Avenue, Mandaluyong City 1550
Metro Manila
Philippines

Guntur Sugiyarto

Asian Development Bank ( email )

6 ADB Avenue, Mandaluyong City 1550
Metro Manila
Philippines

Carlos Vargas-Silva

University of Oxford ( email )

58 Banbury Road
Oxford, Oxfordshire OX2 6QS
United Kingdom

HOME PAGE: http://www.carlosvargassilva.com

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