Tuesday, January 23, 2018

Ensure better use of remittance

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Remittances sent by Bangladeshi nationals working abroad have been a major pillar of foreign exchange earnings for the country for quite a long time now and that Bangladesh now stands on a strong economic footing is largely attributable to the robustness of this sector. Even though it is not possible to measure the exact amount of remittance Bangladeshis send home as not all of it comes through formal banking channels, the sum received officially is huge. It is a matter of gratification that remittance inflow to the country is touching new heights every passing year notwithstanding multifarious limitations and challenges.

Nevertheless, the foreign exchange remitted by Bangladeshis working outside the country is used predominantly for family consumption and develop the family by paying school fees, building houses whereas a more planned use of the received money, especially investment in productive sectors, can greatly accelerate the growth of the national economy. Various empirical studies have found that foreign remittances can play a more effective role than foreign aid funding in socio-economic development of a country.

This is because remittances go directly to their targets, while, estimates show that, less that 10 percent of the funds coming as official development assistance actually benefit the most vulnerable populations in some cases. The rest 90 percent or so enter the pockets of government officials and even foreign aid workers who are sometimes paid exceedingly highly to live in luxury in the midst of the poverty they are likely to eliminate. We expect the policymakers to take this aspect into account and devise policies in such ways so that the country can make the most out of the huge remittance it receives every year.

Another important issue that needs sincere pondering is that the bulk, if not all, of the foreign remittance is sent by people who belong to the lower strata of society. They go abroad by borrowing money and leaving their family entirely dependent on their income. Thus it is quite natural the money they send would be used primarily for family purposes.

We urge the government to go for robust policies to attract the expatriates who, along with their family, live in foreign lands in richness and are more potential investors. The government will have to incorporate the diaspora community more in the country's political system to make these people inclined towards investing in their motherland in order to harness the full potential of remittance flows.

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