Discussions are underway at the World Trade Organization (WTO) 2024 Public Forum this week, focusing on reducing remittance costs for developing countries. These talks are in the early stages and involve the WTO, international organizations, financial institutions, and central banks from developing nations, although not all members of the WTO agree on the approach.
WTO Deputy Director-General Xiangchen Zhang revealed that some developing countries have put forward proposals to the WTO’s Council for Trade in Services. He emphasized the significance of this issue for developing nations as remittances play a crucial role in their GDP growth.
The World Bank reports that the global average cost of remittance stood at 6.35 percent in the first quarter of 2024, significantly higher than the United Nations Sustainable Development Goal target of below three percent. Zhang noted the importance of collaboration, stating, “The WTO cannot achieve this goal by ourselves alone. We need to work together with the financial institutions and other international organizations.”
He called for more discussions, collaboration, technical assistance, transparency, and the utilization of digital technology to assist developing countries in lowering remittance costs. Experts at the forum were invited to share insights on the challenges faced by these nations.
Zhang emphasized that while the information gathered is essential, further steps are needed. The recommendations discussed during the forum will be presented to the Committee of Trade in Financial Services to foster deeper discussions on the matter. He reiterated the importance of raising awareness among WTO members and collaborating with organizations such as the International Labour Organization, the International Organization for Migration, and leading financial institutions like the World Bank and central banks in developing countries to devise effective strategies moving forward.
In Fiji, personal remittances rank as the second largest source of foreign exchange, with a 14.2 percent increase in the first quarter of this year, amounting to $310.5 million, compared to $271.8 million during the same period last year.