Moroccan Diaspora Remittances Surge 46% in 2021, Defying Expert Predictions

The evolution of MRE transfers since the beginning of the pandemic has surprised experts, economists and the financial authorities in Morocco who were forecasting a drop in remittances from the diaspora. According to data from the Office des Changes, MRE transfers experienced a 4.5% growth in 2020, reaching 68.2 billion dirhams compared to 65 billion recorded between 2017 and 2019.

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This surprising growth would be caused by the solidarity expressed by MREs with their families in Morocco during the health crisis, explain the experts from the Office des Changes, the Ministry of Finance and Bank Al Maghrib. The upward trend in MRE transfers continued in 2021, showing a 45.6% increase at the end of July, a level never reached before. During the seven months of the year, MRE transfers have already reached 54 billion dirhams, or 80% of the total transfers for the year 2020, reports Médias24.

"According to the latest edition of the World Bank’s Migration and Development Brief ’Migration and Development Brief N°34’ published in May 2021, MRE transfers by region increased in 2020 by 6.5% in favor of Latin America and the Caribbean, 5.2% for South Asian countries and 2.3% for the Middle East and North Africa. For example, these transfers increased by 18% and 17% respectively in 2020 in the case of Bangladesh and Pakistan. Similarly, remittances from Mexican migrants marked an improvement of 10% during the same period," explains the Office des Changes, noting that this trend is global.

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But more than that, "the consistency of migrants’ remittances can largely be explained by the budgetary support measures for households and businesses in the host countries, particularly in Europe, which have contributed to a more favorable economic environment," the same source advances. In France, remittances from MREs increased by 5.8% in 2020, or 1.3 billion dirhams more than in 2019. The same trend was noted for Spain and Italy where transfers also increased by 9.8% and 6.5% respectively over the same period. On the other hand, remittances from MREs from the United Arab Emirates fell by 3.1%.

For global expert Iñigo Moré, a teacher at Berkeley and founder of Remesas.org, solidarity alone cannot justify this trend. "Solidarity obviously exists, and will continue. We cannot deny it, it is even at the origin of the transfers. But this effect does not explain the strong progression achieved in 2020 and especially in 2021," he observes. According to him, this progression is only the reflection of a reality that existed, but was not expressed in the official statistics.

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"Before, an MRE could enter the country at any time of the year with money, part of which he would leave to the family. This was not counted as a transfer. But with the closure of borders, travel restrictions, this flow has become formal by force of circumstances, hence the strong progression we are seeing today in the figures," develops the expert who had predicted a slowdown in the upward trend as early as September 2020. "Indeed, that was my forecast. But we are facing a new situation that is disrupting all our forecasting models. Today, we have to integrate the factor of formality, also take into account interest rates and the exchange rate which are also important factors," he adds.