HomeLocalHard-up families rely on remittances from abroad

Hard-up families rely on remittances from abroad

Her sons send money regularly back home, but are undocumented and she fears if they returned to Zimbabwe, her major source of income may be cut off.

“If it was not for them, I would have died in 2008,” she says. “They send money for rentals, school fees for their siblings and groceries too.”
Ndlovu, a single mother, said she relied on cross-border transporters to bring her money and groceries from her sons, although they were sometimes erratic and unreliable.

“Sometimes the money delays or it never gets here, but I am grateful for the times when I get it,” she said.
In recent years pirate commuter omnibuses, popularly known as omalayitsha, have recorded brisk business ferrying goods and money between South Africa and Zimbabwe, while some bus operators at Roadport Terminus in Harare regularly tout themselves as the best “hand to hand carriers” of cash and goods.

Despite the unreliability of informal remittance methods, a study by a South African rights group revealed that Zimbabweans in South Africa were sending home up to US$900 million dollars annually.

However, this money is largely sent through informal means, a report launched last week by People Against Suffering Oppression and Poverty (Passop) revealed last week.

The study revealed that of an estimated three million Zimbabweans, 90% sent money home regularly, sending an average of a third of their incomes.
“These findings are higher than those from most other remittance corridors in various parts of the world, which underscores the depth of the current dependence on remittances in Zimbabwe,” reads the report.

The report estimated that 40% of the remittances were repatriated back to Zimbabwe.

“This accentuates not only the importance remittances currently have in supporting livelihoods, but also their effect on the Zimbabwean economy, being one of the most important sources of foreign currency inflows,” continues the report, titled; Strangling the lifeline: An analysis of remittance flows from South Africa to Zimbabwe.

The latest figures by Passop indicate a huge jump in the amounts being remitted to Zimbabwe as in 2010 the World Bank had put the figure at between US$360 and US$490 million.

Probably to reflect the variance between informal and formal remittances, the Reserve Bank of Zimbabwe in January 2011 said repatriations accounted for US$263,3 million.

Latest figures were unavailable.

Remittances have for long been the backbone of the Zimbabwean economy, observers have said, but since most of the repatriation was done informally, it was difficult to tell how much was being sent back.

But for Ndlovu and millions others, they hope the cost of sending money back home is reduced as that could mean more money for themselves and those who are remitting it.

cost of sending money too high: Passop

 

The Passop report argues that the amount being sent back by Zimbabweans could be much higher, save for the high costs of sending money from South Africa. Remitting money costs between 10 and 15% of the value sent, while in other more efficient countries the charge is between 3 and 5%.

“To charge exorbitant fees on the money sent back by immigrants and refugees to their desperate families is to strangle their lifeline,” Braam Hanekom, Passop director, said. “The excessive difficulty and high fees charged is surely another factor prolonging the crisis in Zimbabwe and increasing migration flows to South Africa. It is clear that South Africa is not doing Zimbabwe or itself any favours here.”

The report argues that if the development gains for Zimbabwe are to be maximised then the formalisation of remittance flows must be fostered through the implementation of a number of key reforms.

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