Remittance drops 34% in April amid pandemic

Remittance, the only lifeblood keeping the foreign exchange market propped up amid the falling export earnings, tumbled by 34.10 percent year-on-year in April as the coronavirus hit the global labour market.

Bangladesh received remittance worth $945 million in the first 29 days of April, compared to $1.43 billion in the same month last year, according to the central bank data.

Manpower export, which had already been declining due to the global financial crisis, has been further worsened by a fall in oil prices and the Covid-19 pandemic.

In February, manpower export fell by 15.50 percent, compared to the previous month.

The grounding of flights in March following the coronavirus outbreak caused immense suffering to overseas workers, severely affecting remittance inflow which had already been on a downward spiral in the first three months of this year.

The Middle East accounts for more than 65 percent of the total remittance inflow to Bangladesh.

Other destinations for Bangladeshi labourers, such as Italy, US and the UK, have also been severely affected by the pandemic. Many Bangladeshi expatriates returned from Italy as the coronavirus spread at an alarming rate in the European nation.

But remittance inflow kept its strong growth since the government announced 2 percent cash subsidy in the budget for the current fiscal year, allocating Tk3,060 crore to meet the expenses of this incentive.

Among all the economic indicators, only remittance remained strong for several months, giving the Bangladesh Bank a breathing room in managing the current account balance.

The total remittance in the first ten months of the 2019-20 fiscal year stood at $14.72 billion, 10.64 percent higher from the same period last fiscal year.

A senior official of the Bangladesh Bank said the falling trend of remittance may turn around ahead of the Eid-ul-Fitr, despite the uncertainty brought on by the pandemic.

On a positive note, thanks to the dismal trend of imports, foreign exchange reserve of the central bank stood at $33.10 billion on Thursday.