Africa’s remittances top $90b yearly

France and Germany -based Tempo Money Transfer, has just completed its study on the remittances segment of a 1.1-billion populated region, in Africa.

The Paris-headquartered remittances provider has a solid presence in the continent, operating in Nigeria, Guinea, Senegal, Gambia, Mauritania, Sierra Leone and Comoros.

An analysis by Tempo Money Transfer, indicated that the amount of transactions via money transfer systems have grown from $90 billion to $92 billion, in Africa, during 2015. Demonstrating a slight growth of 0.5 per cent to 1.5 per cent throughout the period.

Out of this, Nigeria accounted for $25 billion, with a 1.5 per cent growth.
The president for the company, Jeffrey Phaneuf, said that the volumes of remittances flow, mostly depend on the difference in life standards and GDP per capita in various countries, and while the US and Western European countries have been main donors, Asia followed by Africa, are the main recipients.

“The market basis is the funds which economically active people, living overseas, send back home to their friends and loved ones,” said Phaneuf.

Migrant workers account for over 90 per cent of overall money transfers.

He said that both Sub-Saharan and North Africa have demonstrated positive slight growth in 2015.

The main markets in the Sub-Saharan region are Nigeria, Kenya, South Africa and Comoros.

In the North of the continent, the biggest segment has been Morocco, Egypt, Algeria, Sudan and Tunisia.

Tempo attributes slight growth, to relatively poor infrastructure in the countries, especially dependent on the money sent from abroad. However, he said that the potential for demand is on the rise and GDP in both parts of the continent vitally relies on the remittances sent mostly from Europe and the US.

Phaneuf said that in Eritrea, as an example, nearly 40 per cent of GDP is money transfers, Burundi – almost 25 per cent, Comoros – 20 per cent, in Sierra Leone – it is up to 15 per cent.

In Nigeria where the standards of living are higher, the degree of GDP dependence on remittances has been around 5 per cent.

Phaneuf said that in 2016 the company expects Africa to keep its slight growth, as far as remittances is concerned.

“The global economy remains in no great shape at the moment. That means the number of jobs isn’t going to improve drastically. At the same time, Africa will remain one of the most lucrative segments on the money transfer global arena,” he said.