TITLE:
Contributions of Diaspora Remittances to Economic Growth & Development in Nigeria: A Housing Finance & Infrastructure Perspective 2000-2023
AUTHORS:
Abel Eseoghene Owotemu, Nnamdi Ifechi-Fred, Adekunle Faleti
KEYWORDS:
Diaspora, Remittances, Economic Growth, Development, Infrastructure and Housing Development, Social Impact
JOURNAL NAME:
Journal of Service Science and Management,
Vol.17 No.4,
July
23,
2024
ABSTRACT: Migrant remittances remain a critical contributor to the economic growth and development of many emerging nations like Nigeria. The World Bank has estimated that nearly $160 billion is transferred annually through official channels. The study highlights that the likely impact of remittances on economic growth depends on the purpose and how host countries and recipient households use their remittances. If remittances are used for infrastructure investments, human capital development, healthcare, and education, it could have a positive impact on economic growth and development in the long run. The study finds that remittances positively affect economic growth by supporting and expanding the limits on household income, as remittances potentially stimulate commercial activity and investment. The study also notes that remittances improve economic growth and contribute to development in countries with structured, open markets and innovative policies that encourage economic and institutional growth. Such innovative and open economies tend to allow the free flow of capital and labour, which are key to driving economic growth and contributing to housing and infrastructural development. The research noted that remittance flows in 2018 were estimated at 6.1% of GDP, with an estimated 87.5% of these flows used for construction and/or home purchase. The research employed a mixed-methods research approach, which involved collecting qualitative data from interviews and questionnaires and quantitative data from external sources. The research sample comprised 387 Nigerians in the diaspora, across multiple countries, in addition to 3 banks, 4 non-bank financial institutions, and a government agency. The study faced challenges in accessing diaspora data through Financial Institutions and NiDCOM due to proprietary data protection issues, and a lack of information on informal peer-to-peer remittance activities, which financial institutions consider a major contribution to economic activities, domestic spending, housing development and construction activities.