Remittances decline by 2pc in July, but still over $2bn

Published August 11, 2021
The inflow of remittances continued with over $2bn for the 14th consecutive month. — AFP/File
The inflow of remittances continued with over $2bn for the 14th consecutive month. — AFP/File

KARACHI: Overseas Pakistanis working around the world sent $2.71 billion last month.

The State Bank of Pakistan (SBP) on Tuesday said that this was the second highest level of remittances reported in the month of July.

The inflow of remittances continued with over $2bn for the 14th consecutive month.

“In terms of growth, remittances increased by 0.7 per cent over previous month and showed a decline by 2.1pc over the same month last year,” said the SBP.

The central bank said this marginal year-on-year dec­line was largely on account of Eidul Azha, which resulted in fewer working days in July compared to the same month last year.

The previous financial year witnessed record inflow of remittances worth $29.4bn with growth of 27pc which supported the external account of the country.

The inflow of remittances enabled the government to bridge a very high trade deficit as the import bill kept increasing in each month of FY21 leaving no chance for the country ending the fiscal year FY21 with a current account surplus.

Till the end of 11 months of FY21 the current account was surplus with $153m but June posted a huge deficit and the year at 0.6pc current account deficit of GDP.

According to the latest data issued on Tuesday, the inflow from Saudi Arabia fell to $641 million from $821m in the same month of the previous financial year. The inflow from Saudi Arabia was the highest with $7.667bn in FY21 compared to $6.61bn of FY20.

The SBP data showed that the second highest remittances of $530m came from the United Arab Emirates in July FY22 with a decline of 1.4pc compared to the same month of previous financial year. In the entire FY21, the remittances from the UAE grew by 8.9pc to $6.114bn as compared to $5.612bn in FY20.

The inflow from the United States of America showed a growth of 24pc in July while it grew by 82pc in the same month of the last financial year. Pakistan received $312m compared to $251m in the corresponding period of last year.

The inflows from the US during the previous financial year jumped by 58pc to $2.756bn against a net decline of 47pc during the previous financial year.

The remittances from the United Kingdom remained the same with an inflow of $393m in July compared to the same period of last financial year.

The inflows from the UK grew by 58.3pc in FY21 against a decline of 24.7pc in the preceding year while the remittances of $4.067bn from that country were the third largest in terms of amount.

The inflows from the member countries of the Gulf Cooperation Council (GCC) declined by 1.1pc to $294m from $297m in July last year.

The inflows from the GCC countries in FY21 showed an inflow of $3.309bn while the growth was 13.7pc against 37pc of the preceding year.

The inflow from the European Union increased by 31pc to $298m in July FY22.

Published in Dawn, August 11th, 2021

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