THAMM Nicolle Disc Paper Final Draft 02072021 Cleared.docx

If we focus on the latter, as shown in the graph below, the absolute and proportional scale of remittance flows to each country varies widely. Egypt receives the largest inflows in North Africa and the sixth largest of any country in the world, totaling $26 781 million in 2019. Inflows to the other countries are much smaller, with $6,735 million to Morocco, $2,050 million to Tunisia and $1,792 million to Algeria in 2019. Whereas remittances to Egypt in 2019 equalled 9% of the country’s GDP, 6% for Morocco, 5% for Tunisia and 1% for Algeria.

money, especially if we focus on those with the most frequent and stable source of inflows: whereas 31 per cent of those who receive remittances monthly are able to save, only 10 per cent of those who never receive remittances are.’ 89 In addition to the direct economic effects of lost remittances, studies show that international remittances from migrants to their families reduce child labour and keep children at school. 90 Given its preliminary analyses, in October 2020, the World Bank expected a drop in remittances for all low- and middle-income countries, of 7% in 2020, followed by a further drop of 7.5 per cent in 2021. 91 At the global level, Ratha et al. had estimated that remittances to North African countries would fall by 20% in 2020, compared to 2019, due to the global slowdown 92 By contrast, according to the latest revised World Bank estimates, remittances to Egypt, Morocco and Tunisia grew in 2020 relative to 2019 by 6.5%, 6.5% and 2.5% consecutively, while remittances to Algeria were practically the same. As suggested by Gagnon, such a surprising trend, may result from the ‘counter-cyclical character’ of remittances, as migrants tend to increase during economic downturns, regardless of their own situation, to contribute to the wellbeing of their family or communities. 93 For policy makers on both sides of the Mediterranean, this good news in today’s chaotic and uncertain environment might call for targeted support, as discussed in the next sections. A possible area of opportunity is linked to the development of digital means of payment as well as better financial inclusion, both in the destination countries and in the countries of origin, as shown in the following graph for three of the five countries studied (Morocco, Tunisia and Egypt). This figure shows percentages of women or men who have a financial institution account, or debit card account, or https://www.knomad.org/publication/migration-and-development- brief-32-covid-19- crisis-through-migration-lens/); 4) World Economic Forum (2020) How coronavirus could hit the billions migrant workers send home (Geneva: WEF, available online at https://www.weforum.org/agenda/2020/04/how-coronavirus-could-hit- the-billions- migrant-workers-send-home/). 92 World Bank (2020) Migration and Development Brief 32: COVID-19 Crisis Through a Migration Lens (Washington DC: World Bank Group and KNOMAD, available online at https://www.knomad.org/publication/migration-and-development-brief- 32-covid-19- crisis-through-migration-lens/); 93 Gagnon, Jason (2020) COVID-19: consequences for international migration and development (Paris: OECD, available online at https://oecd- development- matters.org/2020/04/02/covid-19-consequences-for- international-migration-and- development/

Figure 25: Volumes of remittances per country (2000-2020) - Source WB-KNOMAD

If we now consider the household and micro level, at a time of crisis, remittances are an essential safety net for the population, as emphasised by Kalantaryan and McMahon, who note that ‘people who receive remittances in the MENA countries studied tend to be less economically active than those who do not receive remittances. Two-thirds (65 per cent) of those who receive remittances are economically inactive (48 per cent) or unemployed (17 per cent). But those who receive remittances also tend to have a stronger economic standing, as frequently receiving remittances is associated with a greater tendency to be able to save 89 Kalantaryan, S. and McMahon, S., Covid-19 and Remittances in Africa, EUR 30262 EN, Publications Office of the European Union, Luxembourg, 2020. 90 Ebeke, C. H. (2010) ‘The Effect of Remittances on Child Labour: Cross- country evidence’, Economics Bulletin, vol. 30, no. 1, 2010, pp. 351–364. 91 See among others : 1) OECD, CMRS and AUC (2020) How COVID-19 is affecting Egypt’s migrants and refugees, https://oecd-development- matters.org/2020/08/07/how-covid-19-is-affecting-egypts-migrants- and-refugees/; 2) Kalantaryan, S. and Mcmahon, S., (2020) Covid-19 and Remittances in Africa, EUR 30262 EN, Publications Office of the European Union, Luxembourg, 2020; 3) World Bank (2020) Migration and Development Brief 32: COVID-19 Crisis Through a Migration Lens (Washington DC: World Bank Group and KNOMAD, available online at

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