Report Foresees $34.8bn Remittances to Nigeria by 2023

Emma Okonji

The PriceWaterhouse Cooper (PwC), a multinational professional auditing firm, has predicted that diaspora remittances to Nigeria will reach $25.5 billion by the end of the year and $34.8 billion by 2023.

The firm expressed belief that such inflow would continue to strengthen the Nigerian economy in the coming years.
According to PwC’s latest White Paper Series, tagged, ‘Strength from Abroad: The Economic Power of Nigeria’s Diaspora,’ migrant remittances was 77.2 per cent of the federal government’s budget in 2018 and more than 10 times the Foreign Direct Investment (FDI) flows in the same period.

PwC estimated that migrant remittances to Nigeria could grow to $25.5 billion, $29.8 billion and $34.8 billion in 2019, 2021 and 2023 respectively.

Over a 15-year period, PwC anticipated total remittance flows to Nigeria to grow by almost double in size from $18.37 billion in 2009 to $34.89 billion in 2023.

Commenting on the report, the Partner and Chief Economist, PwC, Dr. Andrew Nevin said: “The report is an analysis, which shows the critical importance of the diaspora to Nigeria’s economy. The recently established Nigerians in Diaspora Commission (NiDCOM), led by Mrs. Abike Dabiri-Erewa, indicates that the federal government recognises the strategic importance of the Nigerian diaspora.

“The key next step for the newly established commission is to formulate and execute a strategy to maximise the benefits of Nigeria’s diaspora.

“In addition, we are very keen to see state governments start to engage the diaspora. The primary benefits of remittances to recipient households is the improvement in their general welfare and studies show that 70 per cent of remittances are used for consumption purposes while 30 per cent of remittance funds go to investment-related uses.

“So it is important that Nigeria has a diaspora strategy both at the national and state level.”
Addressing the total remittance flows to Africa, the report stated that Nigeria accounted for over a third of migrant remittance flows to sub-Saharan Africa. Egypt and Nigeria accounted for the largest inflows of remittances into Africa in 2018.

In 2017, Nigeria led the continent in terms of remittance receipts but dropped to second place behind Egypt in 2018, the report added.

It said for four consecutive years, official remittances exceeded Nigeria’s oil revenues.
“Since many transactions were unrecorded or took place through informal channels, the actual amount of remittance flows into the country is arguably higher,” it added.

In the report, it was recommended that platforms that could increase accessibility of crucial information for Nigerians in the diaspora should be created and to encourage and create pooled investment vehicles.
The report stated that early-stage businesses with smaller financing needs, present a great opportunity for those in the diaspora to invest through angel networks.