Angolans are sending less and less money abroad, with transfers falling 58.8% in the second quarter alone.

Financial crisis, unemployment and rising cost of living in Angola are forcing families to cut back on the amount of money they send to families abroad. Portugal, as always, continues to lead the group in countries where Angolans send more money.

Dário do Leste

Remittances and other personal transfers sent to the rest of the world decreased by 33.2% in the second quarter of this year to only US$126.5 million, which mirrors the fall in the financial power of Angolans due to the financial crisis and the high cost of living that is felt in the country, according to the Report on Remittances and Other Personal Transfers,  of the National Bank of Angola (BNA). 

If in the second quarter the Angolans only sent US$126.5 million out, in the first, still with some force, the families dispatched US$189.38 million abroad. 

The brief report does not present the reasons for the fall in the appetite of Angolan families and others to send money abroad, but the current economic environment, of a sharp fall in gross national wealth, helps to explain the phenomenon. 

Just to give you an idea, and this helps explain the effects of the crisis and why Angolans are cutting back on the money they send to relatives abroad.

The Angolan Net International Reserves (RIL) slid, from January to July 5 of this year, 6% and were situated, in the period, at US$13,625.39 million, pressured by the economic and social crisis that the country is going through, which is already forcing the Executive to 'blink its eyes', earlier, to the international debt markets.

As for the destinations of remittances, Portugal, Vietnam and China lead the list of those that receive the most money from Angolan banks. The three countries that lead the list of the main destination countries for remittances from Angola, concentrate, for example, about 84.4% of remittances and other personal transfers sent by residents, of which 67.5% of the value went to Portugal, 10.2% to Vietnam and 6.7% to China.

Meanwhile, in the same period under review, remittances and other personal transfers received from the rest of the world contracted by 58.6% to US$1.6 million, compared to US$3.81 million in the previous quarter and a decrease of 54.4% compared to US$3.5 million in the same period last year.

That is, in addition to the low volume of dollars or other currencies that leave for Luanda, there is also little money coming in. 

The reports also do not explain the causes of the drop in money coming to Angola. Meanwhile, analysts interviewed by Kieto Economia believe that it may be reconciled with the global crisis, characterized by the cooling of the activities of the oil leading industries and related areas. 

Also according to the Migration and Development Summary cited in the BNA report, in 2023 the growth of remittances to low- and middle-income countries (LMICs) is expected to fall to 1.4%, (USD 656.0 billion), due to the slowdown in economic growth in the main countries of origin. 

Thus, and due to these effects, the growth rate of remittances to Sub-Saharan Africa is estimated to be 1.3%.