Money sent home by migrant workers in the Middle East and North Africa (MENA) region is expected to witness the fastest growth globally in 2024, according to the World Bank's latest migration and development brief. This rebound comes after a dip in 2023 due to geopolitical tensions and sluggish economic performance.
The World Bank predicts a 4. 3% increase in remittance flows to the MENA region this year, reaching $58 billion. This growth is projected to continue in 2025, with remittances reaching an estimated $61 billion. This positive outlook is fueled by several factors, including a rise in global oil prices, a major revenue source for many MENA countries.
The rebound in oil prices is strengthening the economies of major remittance-sending countries in the Gulf Cooperation Council (GCC) like Saudi Arabia and the United Arab Emirates. This translates into increased disposable income for migrant workers, allowing them to send more money back home. Additionally, the easing of COVID-19 restrictions has facilitated travel and economic activity, further bolstering remittance flows.
A significant portion of remittances in the MENA region goes towards low- and middle-income countries. These financial lifelines are a crucial source of income for families, supporting basic necessities, healthcare, and education. In 2023, remittances surpassed foreign direct investment and official development assistance as the primary source of external financing for many developing countries.
The World Bank's report acknowledges potential challenges that could hinder the projected growth in remittances. These include slower-than-expected economic growth in high-income countries hosting migrant workers, and fluctuations in oil prices and currency exchange rates.
Despite these potential roadblocks, the forecast for remittance flows in the MENA region for 2024 remains optimistic. The rise in oil prices and the relaxation of COVID-19 restrictions are expected to create a positive environment for migrant workers and the families they support back home.