Migrant remittances and development cooperation

The report examines the role of migrant remittances in development, noting that registered flows to developing countries were nearly 100 billion USD in 2004. It analyzes various transfer mechanisms, from formal bank transfers to informal value transfer systems (IVTS) like hawala, and discusses the complex impacts of these flows on poverty, inequality, and national economies. The document provides specific policy recommendations for Norway, suggesting the use of Pakistan as a test case for engagement and proposing measures to reduce transfer costs, promote financial literacy, and support transnational entrepreneurship.

• Registered remittances to developing countries were estimated to be nearly 100 billion USD in 2004, which is approximately 1.5 times the amount of official development assistance.
• Remittances have a significant impact on the national economies of 11 of Norad's 25 partner countries and are of considerable importance in another 8 countries.
• The use of informal transfer mechanisms has generally declined, with estimates suggesting a drop from 50-60 per cent in the late 1980s to around 20 per cent in the late 1990s.
• Remittances can either reduce or exacerbate income inequality depending on the selectivity of migrants; for example, they had a 'strongly egalitarian effect' in El Salvador, but in rural Egypt, they positively affected poverty while negatively affecting income distribution.
• Large remittance inflows can lead to the appreciation of local currency, which may make exports less competitive and stimulate imports, as seen in Yemen during the late 1970s.
• The Eritrean government has successfully implemented a mandatory remittance system where adults in the diaspora are asked to contribute 2 per cent of their income to the state.
• Mexico's 'Iniciativa Ciudadana 3x1' program matches every dollar remitted by hometown associations (HTAs) with one dollar each from federal, state, and municipal governments, primarily funding infrastructure.
• The report identifies Pakistan as an ideal test case for remittance-related initiatives because it is a partner country with a large immigrant community in Norway and high remittance inflows relative to its economy, without being implicated in armed conflict.

APA

Carling, J. (2005). Migrant remittances and development cooperation. Peace Research Institute Oslo. https://cdn.cloud.prio.org/files/c5e50b50-0b15-45ad-a3d1-e936b3c620ed/file46220_carling_2005_migrant_remittances_and_development_cooperation.pdf?inline=true

Chicago

Carling, Jørgen. Migrant remittances and development cooperation. Peace Research Institute Oslo, 2005. https://cdn.cloud.prio.org/files/c5e50b50-0b15-45ad-a3d1-e936b3c620ed/file46220_carling_2005_migrant_remittances_and_development_cooperation.pdf?inline=true.

Wikipedia

{{cite report |last1=Carling |first1=Jørgen |title=Migrant remittances and development cooperation |publisher=Peace Research Institute Oslo |date=12 January 2005 |url=https://cdn.cloud.prio.org/files/c5e50b50-0b15-45ad-a3d1-e936b3c620ed/file46220_carling_2005_migrant_remittances_and_development_cooperation.pdf?inline=true |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{carling2005migrant, author = {Carling, Jørgen}, title = {{Migrant remittances and development cooperation}}, institution = {Peace Research Institute Oslo}, year = {2005}, month = jan, url = {https://cdn.cloud.prio.org/files/c5e50b50-0b15-45ad-a3d1-e936b3c620ed/file46220_carling_2005_migrant_remittances_and_development_cooperation.pdf?inline=true}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }