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Nigeria attracts $9.22 billion diaspora remittance in H1 2021, increases by 16%

Nigeria attracts $9.22 billion diaspora remittance in H1 2021, increases by 16%

Diaspora remittances into Nigeria increased by 15.6% QoQ to $9.22 billion in H1 2021 compared to $7.98 billion recorded in the second half of 2020. It also represents a marginal 2.2% increase compared to $9.02 billion recorded in the corresponding period of 2020.This is according to the review of Nigeria’s balance of payment account as released by the Central Bank of Nigeria .

 

The increase follows the continuation of the Naira4dollar initiative by the apex bank, which rewards recipients with N5 for every $1 they receive from licensed IMTOs and commercial banks. Recall that the Central Bank extended this initiative indefinitely earlier in May 2021, with a view to increase remittances so as to boost external reserves.

Although Nigeria’s inflow is yet to reach pre-pandemic levels, it is beginning to move upwards compared to 2020, which was soured by the global economic downturn caused by the covid-19 pandemic. Notably, in H1 2021 diaspora remittance inflow into Nigeria rose to its highest levels since H2 2019.

The latest increase in diaspora remittances has also supported the Nigerian current account balance, which has been on a net deficit since Q1 2021. However, Nigeria’s current account deficit improved to $424 million in the second quarter of 2021, from a deficit of $2.1 billion recorded in the previous quarter.

The breakdown of the data from the Central Bank shows that Nigeria has recorded diaspora remittance inflow of $115.15 billion in over 5 years, while outflow stood at $1.18 billion in the same period, indicating a net credit of $113.96 billion.

It is worth noting that Nigeria’s diaspora remittance outflow in the first half of 2021, dropped by 30.1% from $34.59 million recorded in H2 2020 to $24.18 million. It also recorded a marginal decline of 10.6% compared to $21.86 million recorded in the corresponding period of 2020.

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