The COVID-19 pandemic threatens to seriously disrupt the economies of emerging nations due to a sharp decline in remittances.
According to the World Bank, an estimated $625 billion was sent by migrants to individuals in their home countries in 2017, a 7% increase from 2016, when the amount was $586 billion. That is up from $188 billion in 2005, or an average annual increase of 27% while global GPD has grown about 3% a year.
The Philippines, for instance, received in 2017 about $28 billion in remittances or over 9% of its GDP. $10 billion came from the Gulf States; $11 billion from the U.S. and $6.6 billion from four other states.
Several Latin American countries vitally depend on remittances from one country – the United States. Perhaps half of the workers from these countries in the U.S. are unauthorized and may not receive unemployment checks or the one time $1,200 payment.