Country’s remittance could be $100 billion

Asian development Bank said Bangladesh has a lucrative prospect of earning $100 billion remittance in a year exporting skilled workforces abroad. “In FY 2018-19, Bangladesh received a record $16.4 billion remittances from about 12 million overseas workers. With the same number of people working abroad, the remittances can be over $100 billion, if only this young population is trained in new technologies,” said ADB country director Manmohan Parkash while addressing an event in the capital recently.

Experts said to push the remittance inflow further up, the government should focus on creating skilled manpower for the overseas job market. “As the economic uplift of a developing country like Bangladesh largely depends on the remittances received from developed countries like Saudi Arabia, United Arab Emirates, America, Russia, UK and Qatar, it is very much essential to properly train up the workers before sending them abroad,” they added.

Manmohan Parkash said, “To sustain and take the growth of Bangladesh to the next level, a key element is human capital development – Bangladesh, with its demographic boom is in a unique position to benefit from its young population, provided it can be trained in technologies of tomorrow.” He said, “Every year about two million new workers join the labour force.”

Parkash said, “A possible use of blockchain is international remittance. Global remittance is expected to be $715 billion in 2019, of which $549 billion will be to low income and developing countries.” Since these are low value transactions, people remitting through official channels like banks, Western Union pay very high fees and others follow highly risky and expensive informal means, he mentioned. Use of blockchain can make it very cheap and secure to remit money, he added.

He said blockchain is a cutting-edge high-level creative technology that can revolutionize many areas of modern life by Improving transparency, accountability and efficiency in service delivery, governance, finance sector, industries, trade and other areas. However, in the wake of the global recession, Bangladeshi migrant workers have been at the risk of losing their jobs, because they are usually on the bottom-rung of skilled labour, economists said. The number of expatriate workers from Bangladesh have decreased to about 417,084 workers found jobs abroad in the first eight months of 2019 against 500,356 in the same period of the last calendar year, according to the officials figure.

Despite the country’s remittance inflow stood at a record high of almost $16.4 billion in fiscal (FY) 2018-19, up by 9.5 percent from $14.98 billion in the previous fiscal. However, Bangladeshi expatriates sent home $11.65 billion in FY11, $12.84 billion in FY12, $14.46 billion in FY13, $14.23 billion in FY14, $15.31 billion in FY15, $14.93 billion in FY16, $12.77 billion in FY17 and $14.98 billion in FY18 respectively.

Between 1976 and 2019, more than 12 million have people joined the migrant labour force, officials figure said. The World Bank has pointed out Bangladeshi expatriate workers, who speak little English, have poor basic formal education and few vocational industries-specific skills, often face severe job insecurities. The lack of knowledge of a foreign language, other than English, is another limiting factor.

The workers are, therefore, at a disadvantage when it comes to new job opportunities, especially in the tech-driven world. The situation is no better at home. The lack of skills, proper training and limited access to quality education are resulting in poor employment and lower wages in Bangladesh, where the demand for good jobs is overshadowed by supply of poorly trained workers.

In light of these developments, the Bangladesh government has established training centres across the country to educate and train workers in new and advanced skill-sets. Government’s various initiatives, healthier Arab economy for oil price hike and stronger dollar rate at home have recently pushed remittance flow up significantly, which is still not satisfactory level, said bankers and economists.

"We expect that the upward trend of inward remittance will continue in the coming months as the government has announced 2.0 percent incentive on remittance receipts, they said. The government had already allocated Tk 30.60 billion as incentive in the budget for the FY '20 to encourage the expatriate workers to send their money through legal channels, they added.

They said a large portion of remittance comes from only ten countries. If the government emphasises the new destinations and takes several effective steps accordingly especially training up manpower for jobs abroad, the remittance flow will increase significantly. The appreciating US dollar against the local currency may have helped the country reap benefit on account of remittance in recent times, but it may not last long, said a senior banker.

Md Adel Haque, former joint director of the central bank, told Bangladesh Post that the government should find out useful initiatives to increase remittance earnings from new destinations which will help protect the country remittance earnings from risk. Economist and former BB governor Dr Salehuddin Ahmed said, “The government should give more focus on different countries, which are contributing lower remittance flow to Bangladesh at present, by taking effective measures.

He said “Now it’s time to train up manpower for jobs abroad. Otherwise, remittance flow will not increase to a satisfactory level.” Lead Economist of World Bank Dr Zahid Hussain said the remittance has recently increased as local currency taka has depreciated against US dollar side by side oil price hike in abroad.
He said the government should immediately focus on boosting remittance flow which will help increase foreign exchange reserve.

The government should train up local workers as skilled labours before sending them abroad, Zahid said, adding that Bangladesh should build good relation with others countries for sending more skilled workers abroad, which will boost up remittance flow significantly.