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Sierra Leone continues to grapple with dwindling diaspora remittance inflows, marking a concerning trend that persists despite earlier peaks observed.
Following a notable surge from US$113.94 million in the third quarter of 2022 to US$142.14 million in the fourth quarter and further climbing to US$142.69 million in the second quarter of 2023, a downward trajectory commenced in the third quarter of 2023.
Awoko reports that the decline saw remittances plummeting from US$126.9 million to US$111.8 million in the fourth quarter, marking an 11.9 percent decrease. However, the Central Bank projects a potential strengthening of remittances in the next quarter, emphasizing the resilience of Sierra Leoneans abroad in supporting their families and friends back home.
On the foreign exchange front, the total volume traded in the foreign exchange market during the fourth quarter of 2023 amounted to US$332.40 million, reflecting a 16.1 percent decrease from the corresponding quarter of 2022. Despite this decrease, there was a 9.7 percent increase from the third quarter of 2023, where US$303.12 million was recorded.
Commercial banks played a pivotal role in acquiring foreign exchange from various sectors, including the mining sector, international organizations, foreign exchange bureaus, and the service industry. Notably, receipts into customer foreign currency accounts witnessed a significant uptick, rising by 12.3 percent to US$601.78 million in the fourth quarter of 2023 from US$535.88 million in the same period of 2022.
Contributing to this increase were major sectors such as the mining industry, service industry, and international organizations/NGOs. Additionally, there was a surge of 21.3 percent in receipts into customer foreign currency accounts from US$496.08 million in the third quarter of 2023 to US$601.78 million in the fourth quarter. This rise was attributed to heightened contributions from various sectors including mining, service industry, international organizations/NGOs, foreign exchange bureaus, and migrant remittances.
As the dynamics of diaspora remittances and foreign exchange trading evolve, the Central Bank underscores its commitment to monitoring these trends closely. Such vigilance is crucial in informing policy decisions aimed at supporting economic stability in Sierra Leone amidst fluctuating remittance and foreign exchange landscapes.
