The Director of Diaspora Affairs at the office of the President says government is engaging relevant stakeholders in the financial services sector to help reduce the high charges on remittances.
According to Akwasi Awuah Ababio, the estimated volume of remittances to Ghana is about $3 billion which holds huge revenue potential for the country hence the need to reduce the high charges on them.
Mr Ababio was speaking at the IOM’s Africa Caribbean and Pacific Group of states and EU Regional Thematic Meeting in Accra.
He added that the government is embarking on advocacy and education to get the Diaspora to transfer funds through the formal channels.
Although in Sub-Saharan Africa, the flow of remittances is on the rise, the high cost of transfer of funds has been a major hindrance.
Currently, sub-Saharan Africa has been identified to have the highest cost on transfer pegged at 9.4%of the transfer amount, a figure that is 29% above the world average in 2017 and the SDG 10C’s target of 3%.
According to the Chief of Mission for the International Organization for Migration (IOM) in Ghana, Togo and Benin, Sylvia Lopez-Erka more effort must be made to reach folks in the rural areas who are high dependents of remittances.
She said, her outfit is doing a lot in having remittances transferred directly; however, there is a gap in reaching persons in the rural areas where persons do not have adequate literacy. Moreover, more effort must be made to educate them.
She pushed for transparency in costs involved in making transfers and regulating of the transfer market which could help drive down the cost of transfer.
On her part, the program manager for the EU commission, Maria Piazza identified the need for regulations and policies to help harness the benefits of remittances.
“Legislative framework is key to regulate the use of diaspora remittances and there’s a need for discussion on the implementation which is all key to harness the potential of remittances,” she said.
Remittance flows to low and middle-income countries increased in 2017 by 8.5 per cent compared to 2016 rising to $466 billion.
The largest remittance recipients in Sub-Saharan Africa in 2017 included Nigeria ($22 billion), Senegal ($2.2 billion), Ghana ($2.2 billion), Kenya ($2.0 billion), Uganda ($1.4 billion), and Mali ($1.0 billion). These countries are likely to remain the largest recipients in the region in 2018 and 2019.
This new record recorded by the world bank is more than three times the size of official development assistance to low and middle-income countries excluding China.
Globally, remittance flows also reached $613 billion in the same year.
Launched in 2014, the African Caribbean Pacific-EU Migration Action provides technical support on migration to member countries in areas of remittances, readmission and visas.