UAE first quarter remittances surge 17.3%

The increase followed the introduction of value added tax on January 1

Exchange houses hold talks with UAE Central Bank over new rules

The UAE saw a 17.3 per cent surge in remittances year-on-year in the first quarter, according to the central bank.

Remittances were up Dhs6.5bn ($1.76bn) to Dhs43.5bn ($11.84bn) compared to Dhs37.1bn ($1bn) in the same period last year.

The central bank said 71 per cent of transactions were made through exchange houses and 29 per cent through banks.

Indian transfers accounted for 36.7 per cent of remittances compared to 8.8 per cent for Pakistani transfers and 6.9 per cent for Filipino transfers.

The overall increase came despite a decrease in the exchange rate of the UAE dirham by 7 per cent from January until March compared to the same period last year.

Remittances for the whole of 2017 were up 2.2 per cent on 2016 to Dhs164.3bn ($44.7bn).

Read: Expat remittances from the UAE grow 2.2% to $44.7bn in 2017

In January, the country introduced a 5 per cent value added tax on most goods and services.

Read: UAE warns VAT payment deadline approaching

Also on Tuesday, the central bank raised its forecast for gross domestic product growth in 2018 to 2.7 per cent from its previous forecast of 2.5 per cent.

Read: UAE non-oil economic growth slows slightly in Q1