Promote transparency and competition in the remittance market and make remittance transfers to and within Africa, cheaper, safer, faster and easier so as to maximise their impact on the social and economic development in across the continent.
The institute was conceived within the framework of the Africa-EU partnership on Migration, Mobility and Employment in the Joint Africa EU Strategy adopted in Lisbon in 2007 and in collaboration with the World Bank Group (WBG), the African development bank (AfDB), the International Organization for Migration (IOM). It was then established as a Specialized Technical Office of the African Union with the aim to assist the African Union Member States to maximize the economic and social impact of remittances.
Our mission is to” Promote transparency and competition in the remittance market and make remittance transfers to and within Africa, cheaper, safer, faster and easier so as to maximise their impact on the social and economic development in across the continent.”
Three main objectives:
i) Improve remittance data statistics;
ii) Reductions of transfer costs;
iii) Leverage the potential impact of remittances.
The overall objective of the Institute is to harness migrant remittances for social and economic development in the continent with the aim of alleviating poverty in Africa.
AIR has three specific objectives.
Improve the statistical measurement, compiling and reporting capabilities of Member States on remittances data.
The size of remittance flows to and within Africa has been consistently estimated at over US$60 billion since 2010. Though the figures being reported are high, Remittance data compilers consider that they are substantially understated due to many factors, including (1) the lack of efficient remittances data collection and reporting system in many African countries and (2) the large scale of use of informal/unregulated channels and the lack of capacities to estimate those transactions.
AIR supports African Central Banks and Statistical Agencies, through its Technical Assistance Programme (Link to the TA Programme), to work towards the improvement of remittance data collection techniques for better monitoring of the flows and development of sound leveraging policies.
Promote appropriate changes to the legal and regulatory frameworks for remittances, payment and settlement systems as well as use of innovative technology so as to promote greater competition and efficiency, resulting in reductions of transfer costs.
Remittances to Africa are hindered by a number of challenges, which can be particularly severe or even entirely unique to the Continent. Among those is the high cost of remittances transfers to and within Africa. The reduction of the cost of remittance transfers has become a global agenda. African and European leaders committed in Valletta, Malta in November 2015 to ‘By 2030, reduce to less than 3% the transaction costs of remittances and eliminate remittance corridors with costs higher than 5%. Moreover, the UN General Assembly, in September 2015, endorsed a target (SDG, 10c) for the reduction of remittances transfer costs to 3% level by 2030.
Within its Technical Assistance programme, AIR assists the African Union member States to develop and implement sound policies to promote the reduction costs of remittance transfers to and within African to increase. This programme aims, among others, to assist Member States to either develop or upgrade their remittances market regulatory frameworks so as to increase remittances sent through formal channels, reduce the cost of sending money and improve competition and efficiency.
The specific objectives are to develop capacities of Member States to:-
- Promote adoption of robust legal and regulatory framework that would spur costs reduction and promote transparency and efficiency in the market;
- Design reporting systems on remittance data
- Adoption of good international practices in regulatory frameworks
Leverage the potential impact of remittances on social and economic development of Member States, as well as promoting financial inclusion.
Remittances play a critical role in poverty alleviation in recipient countries, mostly among the poorest recipients. If better harnessed, remittances contribution to the social and economic development of Africa will substantially increase.
The African Institute for Remittances assists African countries to maximize the economic and social impact of remittances.
The African Institute for Remittances is established by the African Union Heads of State and tasked to:
- Assist Member States, remittance senders and recipients and other stakeholders to develop and implement concrete strategies and operational instruments to leverage remittances as development tools for poverty eradication;
- Provide technical assistance to government institutions (Central Banks, Ministries, financial and non-financial institutions) on establishing and operating the necessary regulatory frameworks on remittances;
- Promote adoption and implementation of the General Principles for International Remittance Services (GP) by Member States, including transparency and consumer protection, an accessible payment systems infrastructure, an enabling legal and regulatory environment, a balanced market structure and competition as well as sound governance and risk management;
- Conduct empirical research on remittance markets, to address the main market inefficiencies and explore best practices in the area of remittances and disseminate findings;
- Collect and disseminate data on remittances and manage the remittances price database including Send Money Africa (SMA);
- Engage with private sectors players to address market failure, particularly to act as a catalyst in fostering investment in remittances, innovating in service delivery and promoting technology usage by Remittance Service Providers (RSPs) including non-bank financial institutions;
- Improve capacities of non-bank financial institutions to strengthen their ability to offer remittance services in rural areas;
- Foster effective ways of networking, coordination and cooperation among Member States and stakeholders to address remittances issues in a more strategic and programmatic manner;
- Enable development of content and technology platforms for country-based payment and settlement systems for remittances;
- Promote policies that improve the development impact of remittances;
- Establish an Information center on remittances in Africa.
Our Governance Structure
The Governance structure of the African Institute for remittances is composed of:
a) The Governing Board (The Board);
b) The Consultative Forum;
c) The Secretariat.
The board oversees the management of the Institute. Members of the Board shall meet at least once a year in ordinary session in accordance with its rules of procedures and shall also be convened upon request, by one half of its members, or upon the request of (a) The policy organs of the Union; of (b) The Secretariat, in the event of a situation that necessitate holding of the Board meeting.
The Board is composed of eleven (11) members, as follows:
a) Five (5) Ministers of Finance and Economic Planning representing the five Regions of the African Union nominated by their Regions, failing which they shall be nominated by the STC;
b) A representative of the African Union Commission;
c) A representative of the Host country;
d) Two (2) Governors of Central Banks representing the Association of African Central Banks (AACB);
e) A representative of the African Private Sector;
f) Chairperson of the Consultative Forum;
Where applicable, the term of office of members of the Board shall be a non-renewable period of three (3) years.
The Board shall elect from among its members, one of the Five (5) Ministers as its Chairperson, on a regional rotational basis for three (3) years. In the event of the Chairperson vacating his/her position before the expiration of his/her tenure of office for whatever reason, he/she shall be replaced by a Minister to be designated by his/her Region.
The Legal Counsel of the Commission or his/her representative, without having a voting power, shall attend the Board meetings to provide legal advice as may be required. The Board may invite such expertise, from relevant professionals, as may be necessary. The Institute’s Executive Director shall act as the Secretary of the Board.
The Consultative Forum
The Consultative Forum serves as an Advisory and Technical Body of the Institute. The Forum is composed of Twenty three (23) members as follows:
a) Two (2) Representative of the Commission;
b) Five (5) representatives from the Diaspora/Migrant organizations representing each of the five Regions of the African Union;
c) Five (5) representatives from development partners;
d) Three (5) representatives from the Private Sector (Banks, Money Transfer Operators, etc.) organizations;
e) Two (5) representatives from the Association of African Central Banks (AACB);
f) A representative from the Host Country.
Members of the Forum shall serve for a non-renewable term of three (3) years where applicable. The Forum shall elect its own Chairperson and Vice Chairperson by a simple majority and they shall serve for a non-renewable term of three (3) years and two (2) years respectively. The Executive Director of the AIR shall serve as the Secretary of the Forum. The Forum may invite such expertise from relevant stakeholders as necessary. The functions of the Forum shall be to:
a) Recommend strategic/activity plans to the Board and the Secretariat;
b) Advise the Board and Secretariat on emerging issues and other related matters on remittances;
c) Advise the Board and the Secretariat on the implementation of decisions by the Policy Organs;
The Institute is managed and administered by an Executive Director. Under the supervision of the Director for Social Affairs of the Commission, the Executive Director is responsible for:
a) the implementation of the decisions of the policy organs of the Union and the Board of the AIR;
b) the implementation of the Statute of the Institute, as well as, other conventions and decisions of the Governing Board of the Institute;
c) the preparation of the Annual budget of the Institute;
d) oversee the recruitment process of staff members, pursuant to the Staff Regulations and Rules of the Commission except for the appointment of the Executive Director as stipulated in this Statute;
The Executive Director is appointed by the Commission on the approval of the Board and serve for a period of four (4) years and renewable only once.