The development impact of remittances to Nicaragua

Global workers' remittances have grown noticeably in recent years. Remittances are now a key macroeconomic factor in many developing countries, representing an increasingly large percentage of total monetary inflows. For many developing countries, remittances are comparable to or greater than total export earnings, official development assistance (ODA), and foreign direct investment (FDI). Remittance flows are also more progressive than these other international flows as they more equally distributed. The relative volume of this resource and its sharp increase over the past decade makes remittances increasingly significant in terms of development. Focusing in Nicaragua, this paper reviews the increasing importance of remittances and examines their potential to bring positive development outcomes to developing countries.