Hard Times Ahead

Many of our readers will be very concerned at the report in today’s paper which indicates that remittances to West Africa are set to fall in 2009.

Here in The Gambia we still depend very heavily on money coming back from Europe and the United States and any change in this could leave many facing financial ruin. The other major concern at the moment is the exchange rate.

The English pound, the dollar and the Euro are all now bringing in less Dalasi then they had been. The pound particularly remains in or around D40, sometimes lower, but it was only last year that it was brining in D50.

The result is that at a time when prices are rising at an horrific rate the money coming back from Europe and the US is buying even less then it was when prices were lower.

Of course this situation will not only affect us here in The Gambia. Many of our neighbours in West Africa will also be affected.

The World Bank’s latest migration and development brief, published on 11 November, says remittance income in developing countries will decline by about 1 percent from 2008 to 2009.

Dilip Ratha, lead economist and manager of the migration and remittances team at the World Bank, told IRIN the drop could be far sharper. “A worst-case scenario would bring them down by as much as 6 percent.”

Remittances to sub-Saharan Africa had been rising steadily since 1995, increasing by 11 percent between 2006 and 2007. Sub-Saharan Africa took in US$19 billion in remittances in 2007, or 2.5 percent of gross domestic product (GDP), according to the World Bank.

Worldwide $265 billion flowed to developing countries through remittances in 2007, surpassing official global development aid by 60 percent, the World Bank says.

It is clear that we are facing a crisis in this regard but unfortunately it is one over which we have little control. All we can do is try to ensure that we boost our income from other areas, become more self sufficient and try to generate alternative sources of income for those people who will be affected by this.

“Money is our madness, our vast collective madness”

D.H. Lawrence