Quarterly Remittances Drop In 2009, BoA Survey
By ervin lisaku
TIRANA, Oct. 20 – The amount of remittances immigrants sent to their families in Albania registered a considerable drop in 2009, reflecting the effects of the financial crisis in their host countries, mainly Greece and Italy, where more than one million Albanian immigrants live and work.
The average amount of quarterly remittances a household received in 2009 dropped to 270 euros, down from 289 euros in 2008, according to findings of a survey carried out by the Bank of Albania and the country’s Institute of Statistics (INSTAT). The survey published in the Bank of Albania 2009 balance of payment report this week showed the average quarterly amount of remittance in 2009 dropped by 7 percent compared to 2008.
The average amount a single immigrant sent to Albania every three months in 2009 also dropped by 25 percent, registering 193 euros, compared with a quarterly amount of 241 euros in 2008.
On average, some 60 to 70 percent of the money sent in remittances was used to cover daily expenses.
Remittances are a major source of income for the majority of families in urban and rural areas. This is proved by the survey findings showing that 70 percent of families managed to save only 10 percent of the amounts they received in 2009.
Some 800 families previously covered in the 2009 survey were excluded from the 2009 questionnaire because of not receiving remittances anymore and replaced with 1,000 new families.
The 2009 survey covered 1,217 families, 63 percent of which reported to having regularly received remittances in 2009.
Data show families living in rural areas got 55 percent of remittances, accounting for 63 percent of the total amount of immigrant remittances.
The 2009 remittances contributed to 29 percent of the total monthly income of a household, down from 31 percent in 2008 and 35 percent in 2007.
The majority of the 2009 remittances, some three-quarters of the total amount, went to families of 1 to four persons. The highest quarterly amount sent in 2009 for four-member families was 441 euros.
Some 46 percent of immigrants sending remittances were reported to living in neighbouring Greece, compared to 41 percent in Italy. A majority of 87 percent of families said they received remittances from acquaintances or immigrants themselves when coming home usually for summer or Christmas holidays, leaving formal money transfers at a limited number.
Remittances H1 2010
Albania immigrants working abroad, mainly those in Greece and Italy, continue bringing less money at home because of the ongoing crisis in their host countries which has cut a considerable number of jobs.
Immigrant remittances during the second quarter of this year reached 222 million euros, up from 170 million in the first quarter of this year, but down 19 million euros year-on-year.
In total, remittances during the first half of this year dropped to 392 million, down from 424 million during the same period last year.
Remittances fell by 6.7 percent during the first quarter of 2010 compared to the same period last year mainly as a result of the crisis in Greece and Italy. Immigrant remittances in the first quarter of this year registered 170 million euros, 13 million euros less than the same period last year.
Albania is particularly vulnerable to a serious Greek downturn, as the majority of remittances into Albania come from migrants in Greece, many of whom work temporarily in seasonal jobs, says EBRD in its 2010 economic outlook report.
“Albania is the one country in this sub-region that managed positive growth in 2009, but growth is likely to decrease in 2010, reflecting the impact of recent floods, a slowdown both in capital inflows and in remittances as well as slower credit growth,” said the EBRD.
The Bank of Albania (BoA) noted in its monetary policy report for the second quarter of 2010 that the drop in immigrant remittances, one of the main sources of foreign financing, and the low rate of foreign direct investment (FDI) need efficient measures to attract foreign capital.
