Remittances Second Largest Source of Foreign Exchange
High costs lead to informal exchange, uncaptured by official sources
SUVA, Fiji (Fijilive, June 6, 2012) – Remittance remains the second largest foreign exchange earner after tourism says Filimoni Waqabaca, permanent secretary for Fiji’s Ministry of Finance. At the Fiji Institute of Accountants Congress in Nadi today, Waqabaca explained the international remittance and the use of innovative technology through the Mobile Network Operators (MNOs). However, he said across the region, an area of concern is the high cost involved in remitting funds from overseas. “As a result, a large portion of funds are channeled through informal means and therefore not captured in the financial system. Remittance level therefore could be understated,” he said. In 2011, MNOs began offering inward remittance through their mobile money services. Vodafone MPAiSA Fiji launched its first cross-border international remittance to allow Vodafone mobile phone users in Fiji to receive money from relatives and friends in Australia and New Zealand where users can then withdraw cash from their agents around the country. Similarly, Digicel Pacific launched its low cost international remittance service that enables people to send money to Fiji, Samoa and Tonga”.
Comment from GMc. Remittances are in my view the Achilles heel of the Pacific. The Pacific is not the only area where economies are greatly facilitated by financial contributions from overseas. But remittences represent such a large proportion of income in Tonga and Samoa and I am sure a number of other islands. I am not sure what is to be done but I think it would be interesting to know what proportion goes on Capital expenditure and what on consumer items like SUVs and the church.