Labor migration and remittances have become increasingly important for many developing and transition countries
in recent decades. In the case of Macedonia, labor migration has a long history, going back for a century
or even more. Yet, remittance flows have ignited considerable interest within the academic and policy community
in the last few years, as net private transfers in Macedonia increased from 565.75 Millions of EUR in 2003
to 923.07 Millions of EUR in 2006.
Despite the high level of remittances, little is known about the sources of remittances (or the main source countries
of remittance transfers), the demographic and educational profile of senders and recipient households, the
final use of remittance inflows (household consumption, investments or savings), the role of the formal financial
sector, the link between remittances and financial development and the prospective trends.
Without proper survey data, accurate estimation of remittance flows and how they are impacting the economy is
not possible. No surveys or other in-depth analyses have been conducted in Macedonia on this topic so far.
Moreover, the link between migration movements and developments in remittance receipts has not yet been
properly analyzed.
The official estimate of remittance inflows in Macedonia was $181.45 millions of US $ in 2006, whereas our alternative
estimate equals roughly 301.8 millions of US $. Therefore, the true importance of remittances to the
Macedonian economy is much higher that the ratio of official remittances to GDP. In addition to shedding light
on the size and importance of remittances in Macedonia, we believe that the insights gained on how remittance
data are used will be useful to policymakers and donor community