Worker remittance inflows start year 2023 with a bang

• January inflows recorded at US$ 438mn

Foreign currency inflows from worker remittances recorded an encouraging US$ 437.5 million in January, up 68.8 percent from a year ago. 
A year ago in January 2022, migrant workers sent back only US$ 259.2 million via official channels as remittances as they chose grey market channels which offered them substantially higher premiums, while some of them held back repatriations over fears of mandatory conversions. 

Remittances to Sri Lanka has been on an uptrend in the last several months as the Central Bank reined in on grey market premiums, cracked down on informal money changers and restored greater stability in the domestic foreign exchange market.  
A record number of migrants topping over 300,000 last year could have also added a fillip to the recent numbers as 2020 and 2021 pandemic related border closures didn’t help those seeking foreign employment. 

As a result Sri Lanka saw a consistent decline in the remittance inflows in 2021 and 2022 after recording US$ 7.1 billion in 2020, a four-year high as pandemic related disruptions sent the grey market channels into hibernation.
There had also been a years-long over-reporting of remittances which was identified and fixed only in the second half of last year.  
Sri Lanka ended 2022 with US$ 3,789.5 million worker remittances, down 31 percent from 2021. 
The mostly positive start to 2023 could be bellwether for relatively solid yearlong inflows from worker remittances.