War leads to surge in money transfers to Ukraine
The war in Ukraine is fuelling a surge in money transfers to the country as migrant workers and refugees fleeing the conflict scramble to send financial support back to their families.
The World Bank said remittances to Ukraine from other countries were expected to rise by more than 20% this year, driven by Ukrainians abroad transferring funds back to friends and family facing the severe economic impact of the Russian invasion.
Meanwhile the flow of funds from Russia to countries in central Asia, where it draws millions of migrant workers from, is expected to suffer a dramatic decline as western sanctions plunge Russia into the deepest recession since the collapse of the Soviet Union in the early 1990s.
Remittances are payments sent from one person to another in a different country, typically by migrant workers sending money back to their families.
The World Bank said the surge in cross-border payments to Ukraine mirrored a trend typically seen after natural disasters, as refugees and migrant workers scrambled to support friends and family. The biggest increases came from Poland, the largest recipient of Ukrainian migrant workers, and, to some extent, the US.
Even before Vladimir Putin’s invasion Ukraine was the biggest recipient of remittances in Europe and central Asia, with record-high inflows of $18.2bn (£14.8bn) last year. However, money flows are expected to surge in 2022 by 20% from the level in 2021 amid the impact of war.
The World Bank said total global remittance flows to low-and middle-income countries were expected to grow by 4.2% to reach $630bn this year.
While Ukraine is expected to record a surge, the organisation said countries with close ties to Russia would probably suffer a sharp fall in remittances due to
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