Worker remittances to developing countries are projected to total $325 billion for 2010, up 5.9% from $307 billion last year, according to the World Bank’s Migration and Remittances Factbook 2011. The flows to developing countries are expected to continue growing in 2011 and 2012, potentially topping $370 billion within two years.
Remittances are one component of the diversified payment rights (DPRs) that emerging-market banks have used as collateral in billions of dollars worth of bonds since the 90s. They are especially weighty in the DPR deals issued by Central American banks, as countries such as El Salvador have an acute dependence on the wages sent home by workers abroad.
Remittance flows fell in 2009 as a severe economic downturn gripped developed countries and gutted employment. The World Bank said that helping shape the future of remittance flows is the growing awareness among developing countries "of the potential for leveraging remittances and diaspora wealth for raising development finance.”
