THE amount of money being sent by migrants to their families back home topped £335billion last year, making it a larger economy than Iran or Argentina, Daily Mail reported Friday.
The figure has tripled in the last ten years and is now three times bigger than the total aid budgets given by countries around the world as more people than ever choose to live abroad. It has sparked debate whether this so-called remittance money could be a viable alternative to relying on help from other governments.
The figures from the World Bank, for example, show that migrants in the UK sent nearly £2.5billion to India in 2011, compared to just £280million handed over by the state.
Britain's shadow minister for international development, Rushanara Ali, who was born in Bangladesh, believes the UK government should try to harness migrant money to complement aid spending.
'I've never heard someone with an origin in another country not feel a sense of obligation or a sense of contribution,' she told The Guardian. 'There will always be pressure on budgets. The time is ripe for coming up with new ideas on how diaspora communities can make a difference.'
Last month, a poll revealed just one in four people support Britain spending billions of pounds on foreign aid every year, with more than 60 per cent believing the cash is wasted.
The finding was a major blow to David Cameron, who is committed to protecting international development from budget cuts. Globally, there are more than 214million migrants, which would make it the fifth most-populated country behind China, India, America and Indonesia.
World Bank officials believe the amount they donate could be billions more because not all cash is sent through banks and money transfer companies on which the figures are based.
For dozens of developing nations, the flow of migrant cash already massively outstrips official aid they receive.
The biggest beneficiaries included India and China, which each received more than £38billion, followed by the Philippines (£15billion), Mexico (£15billion) and Nigeria (£13billion).
A number of countries have set up initiatives to manage the cash flow, including the Rwandan government, which saw much of its aid cut last year over claims it was helping rebels neighbouring Democratic of Congo. As a result, it has asked all Rwandans living abroad to contribute to a new 'solidarity fund' to make up the difference.
However, migrants are complaining they are being charged more than 20 per cent in transfer fees as companies scramble to exploit the ever-growing market.
TOP BENEFICIARIES OF
MIGRANT REMITTANCES
1. INDIA: £40b
2. CHINA: £39b
3. MEXICO: £15b
4. PHILIPPINES: £14b
5. NIGERIA: £13.3b
6. FRANCE: £12b
7. EGYPT: £9b
8. GERMANY: £8.3b
9. PAKISTAN: £7.6b
10. BANGLADESH: £7.6b