As Coronavirus Hits European Economies, Remittances Plummet


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MONTREUIL, FRANCE - A new World Bank study predicts remittances sent home by migrant workers from low- and middle-income countries may plummet by one-fifth this year, prompted by the coronavirus-driven global economic downturn.

In Europe, that translates into billions of dollars lost to families in Africa, the Middle East and elsewhere.

Almost every business in the Paris suburb of Montreuil is shuttered on what is a normally bustling street - except for the Western Union money transfer office. Even so, it is seeing only a trickle of customers.

Retiree Boubacar Baka is sending his usual quarterly payment back to his family in Abidjan. He said it's not much - times are tight. But he said his family has to eat.

With its many African residents, especially from Mali, Montreuil is sometimes called "Little Bamako." On this day, Western Union customer Sidi Djiabate, who is from Mali, has business to do.

Djiabate is sending a small sum to family in western Mali as a Ramadan gift. He said he is an office clerk here, and his job is secure. But he says times are tough in his homeland, where the coronavirus has also arrived. With Mali's borders closed to slow the pandemic, he says people lack basics like sugar.

France is one of Europe's biggest exporters of migrant worker remittances. The African diaspora here, estimated at 3.6 million people, sent more than $10 billion home in 2017.

But coronavirus-triggered layoffs and lost wages are affecting those transfers. Staff at the Montreuil Western Union declined to be interviewed but said their clientele has dropped sharply in recent weeks.

There are other reasons for the slowdown in remittances. One is that a number of money transfer offices are closed under the current shutdown. Companies like Western Union have launched communications campaigns urging clients to send payments via internet or phone app. But not everyone has a computer or smartphone.

Laurent Russier, mayor of the nearby town of Saint-Denis where about a third of the population is foreign born, said some remittances are going the other way, as well. He said migrant workers who have lost their jobs here are getting money from families back home.

The World Bank forecasts Africa alone could lose more than $11 billion in remittances from its diaspora this year, even as experts fear foreign investment and aid could also drop.