August 2020

Can remittances support development in Nepal?

Nepal has one of the largest remittances-to-GDP ratios (24% in 2018) and a third of households has at least one member abroad. Dependence on remittances can significantly slow the pace of structural transformation and leave the economy vulnerable to external shocks. In 2018, the Government of Nepal proposed measures to encourage self-employment and the productive use of remittances. A team of local PEP researchers found that higher remittance amounts are linked to left-behind women working fewer hours and lower revenues for household enterprises.

Find out more in the PEP working paper 2020-06 and policy brief 203

Boosting youth entrepreneurship through informal credit in Benin

A lack of public sector employment opportunities in Benin is pushing youth into self-employment (under 20% are in wage employment). However, a lack of credit to start or grow a business is one of the main obstacles facing Benin’s young entrepreneurs. Despite the Government of Benin implementing measures to promote entrepreneurship, financial inclusion remains low, and formal finance options are not accessible to everyone. A team of local PEP researchers found that access to credit, whether from formal or informal sources, plays an important role in the performance of small-scale youth enterprises in Benin. In particular, credit from informal and family sources is more important to their performance than credit from formal sources for relatively small (in terms of sales) youth enterprises and start-ups.

Find out more in the PEP working paper 2020-16 and policy brief 206