Remittances continue to crash
Worker remittances, Sri Lanka’s largest foreign-exchange earner, posted a decline, for the 14th consecutive month in July this year, as migrant workers only sent home USD 279.5 million during the month, down 38.3 per cent from USD 453.3 million a year earlier.
According to data released by the Central Bank of Sri Lanka (CBSL), during the first seven months of this year, migrant workers sent home USD 1,889.4 million, down 50 per cent from USD 3,777.6 million sent during the same period last year.
In June this year, migrant workers sent home USD 274 .3 million, down 42.6 per cent from USD 478.4 million a year earlier.
In May this year, migrant workers sent home USD 304.1 million, down 33.9 per cent from 460.1 million a year ago.
In April this year, migrant workers sent home USD 248.9 million, down 52 per cent from 518.8 million a year ago.
In March this year, migrant workers sent home USD 318.4 million, down 47.5 per cent from 612 million a year ago.
In February this year, migrant workers sent home USD 204.9 million, down 64.5 per cent from 579.7 million a year ago.
In January this year, migrant workers sent home USD 259.2 million, down 61.6 per cent from 675.3 million a year ago.
During 2021 migrant workers sent home USD 5.49 billion, down 22.7 per cent compared to USD 7.1 billion sent home during 2020.
The CBSL attempted to attract more worker remittances through formal channels providing an incentive above the exchange rate offered by the banks, which was still below the black-market price.
With the foreign exchange crisis taking a major toll on the Sri Lankan economy, the Central Bank decided to float the rupee and the local currency crashed to near Rs 365 against the dollar.
After removing the incentive programme as the exchange rate broke a record high, the Central Bank on Monday (28) issued another circular which restricted currency exchangers from offering higher exchange rates than licensed banks.
Worker remittances have been Sri Lanka’s largest foreign exchange earner and the country’s balance of payment has been highly dependent on the income generated by migrant workers.
In 2020, many Sri Lankans working overseas returned to the country following the Covid-19 pandemic, which shattered the global economy.
The foreign employment sector is one of the largest employment providers to address national unemployment and poverty issues prevailing in the country.
By Mario Andree