$503.73 million in remittances top Samoa foreign exchange earner
Remittance is Samoa’s largest form of foreign exchange earner with the 2017/18 financial year recording about $503.73 million tala (US$193 million) in earnings.
According to figures released by the Central Bank of Samoa, this is an increase of $98.56m tala(US$37.7 million) compared to the 2016/17 financial year, which was about $405.17m tala (US$155 million).
The data also highlights New Zealand is still Samoa’s largest source of remittances with 40-45 per cent or $203.87m tala (US$78 million)of the total remittances for the last financial year.
Australia’s inflow of private remittances amounted to $162.28m tala(US$62 million) and the United States $87.88 tala million(US$33 million) tala for the same period.
American Samoa totaled $17.63 million tala (US$6.7 million), United Kingdom $4.22 million tala (US$1.6 million), Fiji $3.13 million tala (US$1.19 million), and other source countries a total of $23.63m(US$9 million).
Almost 70 per cent or $52.93 million tala(US$20.3 million) of the total remittances are for families and individuals and is an increase of $28.52 million tala (US$10.9 million) when compared to the $322.49 million tala(US$123.8 million) of the previous year.
Churches, schools and Charities are also major recipients of the remittances recording about $52.93 million tala, an increase of $43.89 million tala(US$16.3 million) when compared to the previous year.
“There are quite a lot of church events and those being built last year, and they go to New Zealand and Australia to fundraise a lot of this so they bring that money and a lot of them contribute to the remittances,” said an official at the bank, who is not authorised to speak to the media.
“It’s hard to explain why people are sending money, maybe because they are getting good money and a good economic background.
“If you look at Samoa and Tonga, a lot of remittances are driven by cultural obligations, if there’s a funeral, wedding, bestowal of matai titles, so families start sending this.”
According to the official, there’s been a change in composition, in the past it used to be New Zealand and then the United States, but now it’s New Zealand, Australia and the U.S.
“In the past U.S. had a very strong dollar, so even though there’s not a lot of Samoans from here living in the U.S. and American Samoa, but because of the strong dollar they had quite a strong value of remittances from those countries.
“But now we’ve seen that Australia is the second largest market, and that is because since 2008 there’s been a strong Australian dollar, so the value is going up.
“But we’ve seen a lot of job opportunities in Australia, the mines, and sports as well, we’ve seen a lot of migration from New Zealand to Australia and also with the free visa between these two countries – it has allowed a lot of Samoans in New Zealand to migrate over to Australia, and that was also another contributing factor that Australia is now our second largest market, and then the U.S.”
According to the official, Samoa’s four traditional markets have always been Australia, New Zealand, the United States (including Hawaii), and American Samoa.
“That’s where a lot of Samoans migrate too as well. With American Samoa, it used to be strong at one point, with a lot of the Samoans working at the two canneries at the American Samoa because a lot of the workers used to be hired from this side, but when they closed one of the major canneries five years ago, we’ve seen that decline further and now they are closing another one. The share for American Samoa has declined because of the situation.”
The Central Bank collects data from the four commercial banks in Samoa and the 12 money transfers in order to put together the figures.
“Around about 85 per cent of all remittances come through money transfers, so a lot of people prefer money transfers because it’s cheaper, and more convenient than going to a bank in New Zealand and sending the money, it’s more expensive,” said the official.
SOURCE: SAMOA OBSERVE
