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Diaspora remittances, catalyst for development

Chairman and Chief Executive Officer of Nigeria in Diaspora Commission (NiDCOM), Mrs Abike Dabiri-Erewa, recently announced that Nigerians living abroad remitted about $25.1 billion into the country in 2018. She told journalists in Abuja while reviewing the activities of the agency that although $25.1 billion has been remitted, “there are some areas that have not been captured,” which indicates that the actual value of remittance is higher.

The figure announced by Abike-Dabiri tallies with the report by PricewaterhouseCoopers (PwC), which noted that inflow of remittances by Nigerians in Diaspora make Nigeria the highest recipient of Diaspora remittances in sub-Saharan Africa. With the figure, Nigeria becomes one of the top five nations with high remittance inflows globally.

The nation’s Diaspora remittances has been on ascendancy. In 2016 and 2017, the remittances were $19.7 billion and $22bn respectively, compared with oil export revenue of $10.4bn and $13.4 billion in the corresponding years. In 2018, the oil revenue was $18 billion compared to $25.1 billion sent back home by Nigerians abroad.

The PwC, a multinational professional services network had earlier estimated that migrant remittances by the Diaspora community to Nigeria could grow to $25.5 billion, $29.8 billion and $34.8 billion in 2019, 2021 and 2023 respectively.

The figures show that over a 15-year period, total remittance flows to Nigeria almost doubled in size from $18.37 billion in 2009 to $34.89 billion in 2023.

This is cheery news as Diaspora remittances not only represent a source of relief for households in meeting basic needs but also facilitate the building of resources for increased human capital through funding of education and health care needs of family members. It also means increased physical and financial investments in residential real estate and starting up small businesses.

This shows that in looking for ways of redirecting Nigeria’s growth and economic indices, Diaspora remittances is a sure way of strategically repositioning the country for national development.

From CBN records, Diaspora remittances exceed gross oil revenue. It also far outweighs capital expenditure. Nigeria’s 2019 capital expenditure budget of $6.7 billion but remittance inflow was $25,5 billion. This means that using the 2018 remittance figure of $25.1 billion, it equated to at least four years of Nigeria’s capital expenditures—-and still have some change left.

In addition, in 2018, Diaspora remittances equals 84 per cent of the federal government’s budget as Nigeria’s budget was $29.9 billion while Diaspora remittances stood at $25.1 billion.

Also, the remittances were far more than the sum total of all foreign aids and represented a higher single percentage of the country’s Gross Domestic Product (GDP) and far more than the much trumpeted Foreign Direct Investment (FDI).

This is the reason why the federal government must fully monitor the remittance of the Diaspora funds to ensure that they are not only reported effectively by the CBN, but also that they don’t disappear with the accounting system in the banks in which such funds doesn’t appear in their records of foreign exchange inflow that could be sourced officially by genuine businessmen and women.

More importantly, Nigeria must, as a matter of national urgency, utilize the human and material resources of the Diaspora community as catalysts for development. Other nations have effectively used their Diaspora community for the good of the entire nation. Nigeria should not be an exception.

That is why the establishment of Diaspora Commission (NiDCOM) should not just be for the rhetoric only but must fully fulfil its mandate and meet the initial hopes that trailed its establishment. The agency must specifically target Nigerians who are permanent residents, naturalized citizens, second and later generations and work out incentives that could make them look back home as an investment destination.

It may be necessary for the federal government to establish separate Diaspora Ministry that reach out to Nigerians in Diaspora, especially targeting youths through promotion of effective social, economic, educational and cultural awareness of the country, using successful Diaspora and Nigeria-based role models.

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