Can Immigrant Remittances Support Development Finance?

Abstract

Immigrant remittances are a significant source of income and finance for developing economies, representing about three times’ official development assistance and over half of foreign direct investment annually received. Major motivations to send remittances are for improving food, health, and education spending of families at home as well as for investing in entrepreneurial ventures. Economic policies to channel remittances into development finance should translate these motivations into measures to boost social investment and local and regional production, linking remittances policies to broader fiscal, financial and institutional policies. A national development bank can be a catalyser of public and private interests by supporting the scale up of remittances investment programmes and by building partnerships with regional and multilateral development institutions.

Key words: Immigrant remittances, Development finance, Diasporas, Motivations.
JEL: J15, F39.