Workers’ remittances from West Asia rose by 5.8 per cent to US$7,104 million in 2020 from US$6,717 million in 2019, flagging Sri Lanka’s foreign reserves.
According to the Sunday Times, the increase was reported at a time while everything else economic-wise was gloomy owing to the COVID-19 impact in Sri Lanka.
Director of Economic Research at the Central Bank Dr. Chandranath Amarasekara said with remittances also rising in January 2021 compared to the same month in 2020, they were projecting an increase in remittances in 2021.
Pointing out some key reasons for the increase in remittances, Amarasekera said informal (illegal) channels of sending remittances were plugged due to the pandemic and thus more money came in through formal banking channels.
He said overseas workers were forced to send more money home due to the global uncertainty, relatives struggling at home, and some losing jobs.
The Director of Economic Research at the Central Bank pointed out that the stock market hit records heights during this period.
“A portion of the money that came as remittances may have also gone into stocks which meant increasing amounts coming from abroad,” he said.
Dr. Chandranath Amarasekara explained that despite nearly 100,000 workers returning to Sri Lanka due to unemployment as a result of the pandemic, another 1 million are assumed to have remained.
He said this group may have resulted in the increase in the money being sent home. (NewsWire)