general meeting-10-1-12
DESCRIPTION
TRANSCRIPT
Undergraduate Economics Association10/2/2012
Undergraduate Economics Association
2
AnnouncementsEuropean Union in Crisis: Hopes and Woes of Politics and
EconomicsRishi Chakraborty-- Africa’s Challenge in Developing Migrant
Remittance MarketsDaniel Currie-- Problems With Small Governments Abdul Hannan-- The Multilateral Trading System: Strengths &
Challenges from Least Developed Countries' Perspective
Undergraduate Economics Association
3
Economics Majors Expo Members of the undergraduate club to join the economics
department in staffing the table at the Majors ExpoOctober 18th 12:00-3:00, GSU Metcalf Ballroom (775
Commonwealth Avenue)Email [email protected]
Africa’s Challenge in Developing Migrant Remittance Markets Rishi Chakraborty
5
Undergraduate Economics Association
• IMF Definition:Compensation to Foreign EmployeesMigrant Worker’s Remittances
• Transfer of Funds between Individuals• Migrant Workers to Country of Origin• $375 billion & 12.1% growth (2011)• Income to Households• Development & Poverty Alleviation• Human Capital Formation
What are Remittances?
6
Undergraduate Economics Association
Stable Source of Foreign Exchange
7
Undergraduate Economics Association
Regional Remittance Flows
8
Undergraduate Economics Association
Migrant Remittance Costs
9
Undergraduate Economics Association
Africa’s Remittance Markets
10
Undergraduate Economics Association
1) Low Competition 100 MTOs dominate 90% of Remittance Services Post offices lack cash flows, training & infrastructure 2) High Regulation & Barriers to Entry Exclusivity Agreements (Western Union & MoneyGram) Only Banks, MTOs & Foreign Exchange Bureaus authorized3) Poor Rural Coverage 64% of branches serve 83% of population High transport costs4) Lack of Access to Financial Instruments Low savings, loans, interest & insurance Prevents Effective usage of Remittance flows
Factors for High Costs & Inefficiencies
11
Undergraduate Economics Association
Lack of Competitors
12
Undergraduate Economics Association
• Need for Research & Timely InformationEnhancing impact of public policy on remittances
• Increased Competition to Lower CostsReducing Regulations & Exclusivity AgreementsProviding Incentives for New EntrantsMicrofinance for rural coverage & poverty alleviation
• Improving efficiency of Remittance MarketsProviding training & resources to post officesEncouraging technological innovation (Cell phones)Educating rural population in financial services
Potential Areas for Improvement