Is the remittance inflow to the Turkish economy sustainable? A glimpse of the future through the lens of the past.

Abstract

The impact of global remittance inflows on numerous macro and microeconomic parameters has long piqued the interest of researchers, policymakers, and academics. Remittances have always been vital to Turkey's development as a remittance recipient country. However, this trend has recently changed, Turkey is currently receiving significantly less remittance, and this reduction in remittance is well noted in its economic performance. This study is an attempt in this regard to find out whether remittance inflow to Turkey will be sustained in the future or its decline will continue. The findings of this study will provide insight to the country's economic and financial policymakers in devising policies that would ensure future remittance inflows. An auto-regressive integrated moving average (ARIMA) approach is applied, and remittance inflow data from 1974 to 2019 is used to forecast remittance inflow for the next 11 years till 2030. According to the results, remittances would drop to a level of -1.00 percent of GDP in 2030, down from 4.00 per cent in 1974.