FE Desk
Ahmed Uddin, once an overseas Bangladeshi worker is presently enjoying his new career as an entrepreneur. The 52 year old owns a thriving business of mid scale textile, in his native land - Bangladesh. Ahmed worked abroad for twenty years in a blue-collared job, earning well enough to be able to support himself, as well as his family back home. He aspired to be self-employed, but a lack of capital was the biggest obstacle in the way of his entrepreneurial dream.
In order to realise his dreams, Ahmed began investing a portion of remittances in a savings account back home.
Ahmed is just one of the growing number of middle income migrant workers who are not using remittances just for consumption, but also as a means to invest for a brighter future, remarkably improving their quality of life.
"It all boils down to your priorities. People have been remitting money back home for ages now. Investing in the right channel at the right time has allowed them to live the life they had always wanted," says Mr. A. N. M. Masrurul Huda Siraji, General Manager - Sonali Bank, an agent partner of multiple money transfer companies.
According to the recent ILO study, over 8 million Bangladeshis are estimated to be living in as many as 157 countries. In the 2012-13 fiscal year, the remittance sent to Bangladesh, using formal channels, by migrant workers was US$14.46 billion. The figure stands at a staggering US$20 billion plus, if informal channels are considered. This has a direct reflection in the country's GDP. In 2001-02, remittances were of an amount equivalent to 5.3 percent of Bangladesh's GDP, and that figure increased to 11.1 percent in 2011-12.
"Over the years, we have seen that a large share of remittances received by families of overseas employees, have been primarily used for consumption, whereas only one-third is invested. Investment, in most instances, is for land purchases only, and not for entrepreneurship development. However, this scenario is undergoing a drastic shift now, with migrants making strategic investments of their remittances, which have also led them to live far superior lifestyles," says Mr. Shamim Iftakhar, Country Manager - Xpress Money-Bangladesh.
"Once basic consumption needs are met, this capital is being invested in children's education and small enterprises," he added.
The impact of remittances on the country is both direct and indirect. Channeling remittances in a pool of investments is bridging the gap between Bangladeshis and their long listed aspirations.
