Workers’ remittances decline 29pc YoY to $2.2bn in April

ISLAMABAD: Remittances sent by overseas Pakistanis workers posted a decline of 29 percent on a year-on-year basis to $2.21 billion in April, ARY News reported on Wednesday, citing data shared by State Bank of Pakistan (SBP).

According to the data issued by the central bank, the workers’ remittances posted a decline of 13 percent during first ten months of fiscal year 2022-23 as the remittances fell from $26.143 billion in July-April of FY22 to $22.741 billion.

On a year-on-year basis, the overseas workers’ remittances recorded an inflow of US$2.210 billion in April 2023, posting a decrease of 29.25 percent as compared with the same month of the previous year’s inflow of $3.124 billion.

On a month-on-month basis, the overseas workers’ remittances also decreased by 12.85 percent from $2.536 billion in March 2023 to $2.210.6 billion in April 2023.

According to the remittances’ inflows during April 2023 were mainly sourced from Saudi Arabia ($489.3 million), the United Arab Emirates ($382.1 million), the United Kingdom ($360.7 million) and the United States of America ($275.8 million).

During the corresponding month, the overseas Pakistanis living in Bahrain sent $34.3 million, from Kuwait $62.2 million, from Qatar $67.1 million whereas $85.8 million were dispatched from Oman.

Similarly, the inflows from Germany, France, Netherlands, Spain, Italy, Greece, Sweden, Denmark, Ireland, and Belgium were recorded at $44.5 million, $38.4 million, $4.8 million, $41.2 million, $69.2 million, $29.5 million, $5.9 million, $6.4 million, $9.1 million and $8.3 million respectively.

Likewise, from Malaysia, Norway, Switzerland, Australia, Canada, and Japan, the workers dispatched $8.6 million, $8.1 million, $4.1 million, $44.5 million, $48.2 million, and $5.1 million respectively.

Remittances from South Africa during the month under review stood at $14.85 million while that from South Korea stood at $7.5 million. Similarly, $55.2 million were received from other countries.

Pakistan’s economy is in turmoil amid financial woes and the delay in an agreement with the International Monetary Fund (IMF) that would release much-needed funding crucial to avoid the risk of default.

A day earlier, Moody’s Investor Service warned that Pakistan could default without an International Monetary Fund (IMF) bailout as its financing options beyond June are uncertain.

According to the Bloomberg report, Grace Lim, a sovereign analyst with the ratings company in Singapore, said that Pakistan’s financing options beyond June are highly uncertain and South Asian country can “default” given its very weak reserves.

“We consider that Pakistan will meet its external payments for the remainder of this fiscal year ending in June. However, Pakistan’s financing options beyond June are highly uncertain. Without an IMF program, Pakistan could default given its very weak reserves,” Bloomberg said while quoting Grace Lim.

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The report further highlighted that Islamabad is struggling to restart a $6.5 billion bailout program from the Washington-based lender, which has stalled after the government failed to meet some loan conditions.

“Political tensions ahead of elections due this year are adding to the risk of a delay in the loan, as former premier Imran Khan is showing no signs of backing down against the government and military,” the report said.