The global consulting firm had predicted that remittances by Nigerians in the Diaspora could grow to $25.5bn this year, in its latest white paper entitled ‘Strength from abroad: The economic power of Nigeria’s Diaspora’.
A World Bank report had shown that it costs $19 to send $200 to Nigeria and the rest of sub-Saharan Africa, making the sub-region the most expensive place to send money to.
Analysis of the estimates showed that it would cost $1.19bn for Nigerians in the Diaspora to send money to their loved ones by the end of 2019.
The report said, “Sub-Saharan Africa remains the most expensive place to send money to, where the average cost is 9.4 per cent, about 25 per cent higher there than in the rest of world. However, these costs have been decreasing over the last 10 years partly because of the rise of mobile money technology.”
Analysts at the PwC led by the Chief Economist, Andrew Nevin, noted that remittances through mobile money were two times less expensive than those carried out by money transfer operators and post offices, and almost three times less costly than transactions by commercial banks.
Meanwhile, the Sustainable Development Goal 10 target is for transactional cost of migrant remittances to be reduced to less than three per cent.
The PwC expressed optimism that remittances would increase as more countries in the sub-region adopt mobile money technology.
The study estimated that by 2021, remittances to the country would rise to $29.8bn and $34.8bn by 2023 subject to global economic forces, growth in emigration, economic conditions of residing countries and poor economic fundamentals in the Nigerian economy.
Findings by the PwC indicated that Egypt and Nigeria accounted for the largest inflows of remittances into Africa in 2018, adding that Nigerian led the continent in 2017.
The report said, “In 2017, Nigeria led the continent in terms of remittance receipts but dropped to second place behind Egypt in 2018.”
The PwC attributed this growth to global economic growth, especially in high-income OECD countries and rebound in economic growth in Europe, the Russian Federation and the United States, as well as a rise in oil prices, which boosted economic activities in oil-producing countries.
“Several countries across the globe, including Nigeria, have developed plans towards attracting investment from their Diaspora community for national development,” it said.
The company added, “Essentially, the extent to which the Diaspora contributes to the developmental affairs of a country will be determined largely by trust.”
The PwC analysts noted that state government had started tapping into the opportunities presented by Nigerians in the Diaspora.