Migration policy framework for Africa and plan of action (2018 – 2030) 2.4 Remittances The total global volume of remittances transfers to developing countries far exceeds Official Development Assistance (ODA), and has important macroeconomic effects, by increasing the total purchasing power of receiving economies. Importantly, women migrant workers account for half of the estimated $601 billion in global remittances. 17 International remittances has become a major source of foreign currencies for most African countries and have been found to be more stable, dependable and countercyclical than other forms of foreign currency inflows, such as Foreign Direct Investment (FDI) and ODA, thus sustaining consumption and investment during recessions. In 2015, African economies received - both from overseas and IntraAfrican corridors – officially recorded remittances amounting to US$ 66 billion. Remittances are used by migrants’ families to meet daily subsistence needs, health and education, but are also invested in land, homes, entrepreneurial activities, et cetera. Identifying ways to maximise the developmental effects of remittances, and improving remittance transfer mechanisms, are therefore topics of growing importance to Africa. The African Institute for Remittances (AIR) was established as a Specialised Technical Office of the AU and became operational in 2015. It works on harnessing remittances for development in Africa, by reducing the cost of remitting money to and within Africa, and improving the regulatory and policy frameworks within which remittances transfers take place, including remittances data measurement, compiling and reporting systems. 40 The development contribution of remittances is recognised by SDG 10 Reduce inequality within and among countries, which also notes the persistent issue of high transfer costs. It requests in Target 10.c to, by 2030, reduce to less than 3 per cent the transaction costs of migrant remittances and eliminate remittance corridors with costs higher than 5 per cent. Remittances have a critical role to play in achieving the first Goal of the 2030 Agenda: End poverty in all its forms everywhere. Remittances can improve poor people’s resilience to shocks and even offer a pathway out of poverty with investments in education, health and income-generating activities. However, currently, small and fragile States that tend to be the most dependent on remittance flows have some of the highest remittance fees. 18 Moreover, policies, strategies and programmes on remittances are often gender neutral, even though gender affects the amount and frequency of remittances which migrants send home, as well as how the money is used. Migrants’ remitting behaviour is influenced by several factors, including, but not limited to, gender, age, education, marital status, and position in the family, as well as opportunities in the destination country. It is important to recognise that women tend to send smaller amounts, but higher percentages of their incomes more frequently, and therefore are facing higher transfer costs. Furthermore, women are often not included in formal financial systems due to financial illiteracy and are lacking the benefits and security of those financial institutions. Therefore, reducing transfer fees and making different transfer options accessible to women would benefit these women and maximise the positive impact of remittances on their families and communities. 18 17 World Bank, Migration and Remittances Factbook 2016 UN (2017) Report of the Special Representative of the Secretary-General on Migration, p.23.