Concept harmonization and data exchange in the Middle East Remittances in the Arab countries

1. Concept harmonization and data exchange in the Middle East Remittances in the Arab countries Claude Saadeh

2. Remittances Seminar First remittances seminar was held in Beirut in March 2009 Participant countries were: Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Palestine, Qatar, Saudi Arabia, Syria, and Yemen. Claude Saadeh

3. Joint project: METAC & BDL • The Middle East Technical Assistance Center (METAC): • Center opened in Beirut (in October 2004) • Collaborative effort between the International Monetary Fund (IMF) and several bilateral and multilateral donors. It provides technical assistance and training to: Afghanistan, Egypt, Iraq, Jordan, Lebanon, Libya, Palestine, Sudan, Syria, and Yemen. • Banque du Liban: External Sector Section @ Department of Statistics and Economic Research (ESS) • Sample format based on CEMLA experience was presented, as an example of a regional organization unifying the collection of data. • Compilation of all the participant countries' metadata by ESS-Lebanon Claude Saadeh

4. Objectives To understand the current situation of personal remittance transactions in the different countries To know the differences and/or similarities in compilation and methodologies between the different countries To agree on the best way forward in improving the methodologyamong the different involved countries To establish a database to exchange data on remittances Claude Saadeh

5. Understanding the current situation of countries • Identifying possible remitting channels • Recognizing the predominant remitting channel used in the country • Effectiveness to capture data depends • on the major remitting channels (formal/informal and this consideration depends on the country as what is formal in a country may be considered informal in another given the regulatory treatment) • whether the country is the remitting country or the recipient country, or both. Claude Saadeh

6. Evaluation of current data collection system • Compatibility with BOP concepts ( personal transfers, residency /nationalities) • Comparing the major remitting channels • Checking the match between important channels and data sources covering them • Timeliness with which data are provided • Quality of data coverage • Respondent burden • Legal authority of the compilers • Identifying the most important omissions Claude Saadeh

7. Survey: Country Profile A QUESTIONNAIRE ON THE COMPILATION PRATICES AND REGULATORY FRAMEWORK OF THE REMITTANCES MARKET IN THE MIDDLE EAST COUNTRIES was designed and addressedto the central banks participating in the Seminar, as well as a methodological guide. Claude Saadeh

8. I. CONCEPTS AND INSTITUTIONAL FRAMEWOK • To indicate if the country is adopting the BPM5 concept according to the IMF´s BOP • Manual, Vth Edition on: • Workers’ remittances • Current transfers • Compensation of employees • Migrant transfers • Other • To describe the institutional framework that supports the Central Bank remittances • compilation task • Is there a specific or general law or regulation that rules the remittances market and the remittances services providers (RSP)? • Who are the agents authorized to participate in the local remittances market as RSP (banks, money transfers operators, etc)? • What are the agents that work as RSP but are not authorized by the regulation? Claude Saadeh

9. I. CONCEPTS AND INSTITUTIONAL FRAMEWOK What are the regulatory requirements to be met by a RSP to operate in the remittances market? • Register with a governmental entity • Authorization and supervision provided by a governmental entity Identify the institution in charge of the regulation and supervision of the RSP and how it performs this function Is there any legal obligation to report the remittances flows? (a standardized report /ITRS/ Or other specific survey?) Is there any threshold applied to the report of remittances flows? Access to the statistical information on remittances by the Central bank or any other governmental organization: is there any sanction provided by the regulation in case of non report? Claude Saadeh

10. II- MAIN CHARACTERISTICS OF THE REMITTANCES MARKET Information received and periodicity Remittances transactions (amount &number), Average value, Original currency of the remittance, Foreign exchange rate applied, Date of receipt or sending of the remittance, Country of origin (destination), Recipient (remitter) name, Remittances frequency. Sources of information used for the calculation and/or estimation of the remittance flows (distribution in %). Banking system reports (ITRS), Other RSP reports (not included in ITRS), Other data sources such as models (please explain the main facts of the methodology), Households surveys (coverage, periodicity and statistics compiled), Other reports. Structure of the remittance flows by modality of sending (distribution in %). Electronic funds transfers, Prepaid funds (prepaid cards, money orders, banker's draft), Credit cards, Remittances in cash Remittances in kind, Other. Structure of the remittance market by type of RSP (distribution in %).. Banks, Foreign exchange bureaus, Other financial institutions, Post offices, Courier companies, Money Transfers Operators (MTO), Informal channels Claude Saadeh

11. II- MAIN CHARACTERISTICS OF THE REMITTANCES MARKET Structure of the remittance market in terms of payment formats used to deliver remittances: Cash, Checks, Account to account transfer, In kind, Others. (distribution in %). Structure of the remittance market by remittance channel (Ref. RCG, paragraph 2.18) Formal remittances channels, Semi formal channels, Informal channels. (distribution in %). Remittances transaction costs. Cross check process Existence of any: Validation process applied by the compiling agency? Mirror statistics of the main recipient (sending) countries used in the validation process? Migrant flows. Number of migrants living abroad, Main countries of migration destination (origin), Main characteristics of the migrants: age, distribution by gender, educational level, migration status (legal, illegal, refugee, other), Economic activity of the migrant and economic sector, Average income of the migrant. Claude Saadeh

12. III- COMPLEMENTARY STATISTCS: ECONOMIC DATA AND MIGRATION INFORMATION As a first trial of exchanging existent data based on 2007 and 2008 statistics: for the major ten countries • numbers and values of remittances flows received by country of origin • numbers and values of remittances flows sent by country of destination Indicators Remittances income Current Account Goods Goods & Services Income Current Transfers Net inflows of foreign direct investment National income GDP Total population Claude Saadeh

13. Steps towards improvements Commitment of the countries in: • Adopting or modifying definitions or country practice • Harmonization of existing methodologies • Improving estimation methods • Gathering new data sources (improving coverage) • Cooperation between partner countries by going forward in geographical distribution with a specific attention to participants countries in order to ensure future mirror statistics • Production of a database • A follow up seminar by mid-2010 Claude Saadeh

14. Thank you Claude Saadeh