Over time, remittances have been discerned as the principal facilitator of economic growth in most countries of the world. As more people migrate from their home countries, remittances tend to grow on a larger scale. Claim Your List Of 10 African Books To Read
Remittances have undeniably spurred debates among policymakers in different African states about whether it has abetted in boosting the African economy or making African states more dependent on their nationals abroad.
However, there’s a margin of truth about remittances leading to a degree of dependency of African states on their nationals.
Yet, these remittances have spectacularly improved the living conditions of most households in the continent, which leaves us to agree that when remittances are better utilized, the African economy will revamp more than it has today.
The world bank migration and remittances factbook learned that Africa receives over $35 billion per year, leading to conspicuous consumption and improved standard of living in the recipient households. That’s to say that remittances have the power to transform lives when their potential is fully utilized. Thus, remittances remain the keyway migrants support their relations at home in Africa.
Most Africans lack the understanding to better use these remittances, which still incites poverty, but in this article, we tried to break down how these remittance inflows can better be used.
Here are some ways to use remittances more effectively:
Remittances can be used to start a businesses
Establishing a business venture remains one of the best ways to use remittances. Africa’s climate has indeed become more favorable for businesses to succeed, but what still draws so many citizens from establishing their business plans is capital.
Capital has posed a problem to thousands of vibrant people to create and actualize their business ideas, but when remittances are received from relations abroad, these impediments will ace out.
What business plan do you have, and how much capital does it require for a start-up?
These are the first questions you need to ask yourself, then save some of the remittances you receive from your relations abroad until you meet the required capital and establish that business.
The remittances can as well used to buy inventory for an already established business; just all you need is to list all the required goods and buy them in bulk and refill your stocks.
In addition, remittances can be used to pay off business debts.
Facilitate Education In African Society.
It’s no secret that education is a huge determining factor in how well a country will do economically. Although in most African countries like Nigeria, the educational system has depreciated drastically, leading to the constant migration of citizens aiming to further their education.
Lack of educational facilities has negated most zealous Africans from continuing their education; however, this can be put to a stop when remittances from the nationals overseas are spent obtaining educational facilities like computers.
Many Africans were refrained from furthering their education due to a lack of funds, but this can be mitigated when scholarship programs are introduced.
Hence, remittances can be used to fund students that are otherwise refrained from pursuing their education.
When programs like this are founded, thousands of Africans will get the opportunity to further their education regardless of their family background, leading to an increment in the skilled labor force.
Invest in infrastructure
Without good roads, railways, bridges, electricity, ports, and airports, it’s impossible for any country to attain its potential as an economic powerhouse no matter how rich. Africa obviously lacks these infrastructures.
It’s undeniable that the lack of these infrastructures negated the establishment of active manufacturing companies and depreciated the transportation of goods from different locations.
These remittances should be invested in providing infrastructures in order to build a more stable economy and business climate in Africa.
Invest in health care facilities
Africa has a high mortality rate which deficit health care facilities inadvertently spur. Professionals in the medical field have, on so many occasions, fled from their home countries as a result of this – no facilities they could use to exercise the skill they have acquired all through the university level.
To put an end to this, remittances must be invested in acquiring quality health care facilities, which could aid in saving lives and deplete the high mortality rate in African countries.
Donate to organizations
Remittances can be donated to different organizations in need, especially those that help improve the economy. These organizations might constitute individuals that want to establish a business with little or no capital; therefore, when remittances are donated to an organization that constitutes people of this nature, it will serve as their capital for start-up.
Remittances are an essential part of the African economy, and it’s vitally important that we invest them in important areas where they would yield outstanding results.
Recipient African countries are to ensure these remittances are not spent on frivolities but rather in areas where they could make good impacts.
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