The Migration and Development Nexus: Looking for a Triple Win

The Migration
and Development Nexus:
Looking for a Triple Win
Kenneth Hermele
Economist, Forum Syd, Stockholm, Sweden
Foreword
Migrants and diaspora groups are increasingly recognised as important actors
promoting global, sustainable, human and economic development. Their contributions to welfare and economic growth are valuable both in countries of
destination and origin, resulting in a more optimistic stance in relation to the
role of migration. However, it is also clear that we are only in the beginning of
fully understanding the potential of migration, migrants and diaspora groups.
In this report, Forum Syd analyses the evidence on the Migration and Development Nexus, and highlights three main areas that need to be addressed in
order to strengthen the benefits to be reaped from migration.
In addition, the report examines the ‘triple win’ of migration – the contribution to the migrants themselves, to the countries of destination, and to the
families, societies and countries of origin.
For several years, Forum Syd has been supporting migrants’ diasporas; as part
of this, we highlight their important efforts for their countries of origin.
We hope the report will encourage discussions, develop a curiosity and raise
awareness concerning migration and migrants and the crucial importance of
migration for global development.
Stockholm November 2015
Annica Sohlström, Secretary General, Forum Syd
2
Summary
250 million people are migrants today (excluding refugees and internal migrants),
contributing to the development of their countries of destination as well as to the
well-being of their families, societies and countries of origin. A migrant today is
just as likely to be a woman looking for job in the social and domestic sectors,
as a man working in industry or construction.
SouthàSouth migration is as important as SouthàNorth migration. The
global flows of remittances, a consequence of these migratory movements, are
as significant within the South as from North to South.
The view that migration constitutes a triple win – to the migrants themselves, to
the countries of destination, and to the families, societies and countries of origin
– although not entirely new has only recently come to permeate the Migration
and Development discourse. Two drivers are behind this change in perspective:
• Firstly, the understanding that migrant remittances are large – dwarfing
Official Development Assistance – and resilient in times of crisis – compared to Foreign Direct Investments.
• Secondly, the understanding of the benefits which could be reaped from
the links existing between the diasporas of migrants in countries of destination and the social, political and economic processes of development
of the societies of origin.
But although the potential has been recognized, there still exist important weaknesses in today’s global migration regime, the most important being
• One, the costs of transferring remittances, which although they have
been reduced still absorb a chilling 36 billion USD annually. The ambition
of the recently tabled Sustainable Development Goals of reducing transfer costs to 3 per cent still remains to be operationalized.
• Two, steps to secure migrants social, economic and political rights at
both ends of the migration trajectory remains to be guaranteed, such as
the right of migrants to vote while remaining in their countries of destination, and the right to transfer their acquired social rights (such as pensions) if they choose to return to their country of origin. In addition,
union rights and other social rights need to be secured.
• Three, diaspora organisations and so called Home Town Associations
need to be supported as they are crucial vehicles to bridge the Origin/
Destination divide and keep the migrants connected to their countries of
origin while simultaneously facilitating their integration in the countries
of destination.
After surveying the evidence on the Migration and Development Nexus, sourced
from academic studies and reports published by international organisations and
Civil Society Organisations, this report concludes that migration in all its guises
and directions will remain an essential component of the global economy, as ever
more resources, goods, ideas and people cross borders.
3
Foreword.........................................................................................................2
Summary.........................................................................................................3
Introduction:
Framing of Migration and development......................................................... 6
Migration:
How many, origins, destinations..................................................................... 9
­Remittances – the origin of the win-win view.................................................11
Migration: From “drain on” to “source of ” development
– with a gendered gaze....................................................................................15
What does migration contribute? Individual perspectives.............................. 17
Cost of remitting.................................................................................. 19
What does migration contribute? National perspectives.................................22
Risks and drawbacks of migration: individual and national perspectives........26
Brain drain/gain/waste..........................................................................26
Charges imposed on migrants ..............................................................28
Putting the picture together ..........................................................................30
A new context, a new future.................................................................. 31
Win-Win I: Diasporas and Home Town Associations............................ 32
Win-Win II: Mutual interests ............................................................... 33
Win-Win III: Policy recommendations.................................................34
List of ­References.......................................................................................... 38
4
Boxes
1. Delimitations and definitions...................................................................... 8
2. Defining migrant remittances.................................................................... 11
Tables
1. Main phases in the framing of Migration and development������������������������ 7
2. Migrant stocks.......................................................................................... 10
3. The world’s most remittance dependent economies����������������������������������� 13
4. Mis- and preconceptions vs Facts.............................................................. 29
5. Improving the potential of migration for development������������������������������ 35
Figures
1. Financial flows to the South...................................................................... 12
2. Top receiving countries.............................................................................. 13
Cases
1. Forced remittances..................................................................................... 15
2. Roma migrants in Spain, Italy and Scandinavia��������������������������������������� 18
3. Migrating from Ethiopia........................................................................... 19
4. Migration and the SDGs............................................................................ 20
5. The Somali diaspora.................................................................................. 23
6. Migrants on Sweden’s labour market......................................................... 27
7. Kowsar Aden, Swedish-Somalilander........................................................ 32
Acronyms
CSO
Civil Society Organisations
FDI
Foreign Direct Investment
GDP
Gross Domestic Product
HTA
Home Town Associations
IMF
International Monetary Fund, Washington DC
IOM
International Organisation for Migration, Geneva
Knomad Global Knowledge Partnership on Migration and Development,
World Bank
MDG
Millennium Development Goals
ODA
Official Development Assistance
OECD Organization of Economic Cooperation and Development, Paris
OWWA Overseas Workers Welfare Administration, The Philippines
SDG
Sustainable Development Goals
SEK
Swedish kronor
SSA
Sub-Saharan Africa
UN
United Nations
UNDP United Nations Development Programme
USD
United States dollar
WWII
World War Two
5
INTRODUCTION:
Framing of
Migration
and development
When the Swedish government summarized its stand on migration, the point of
departure was quite optimistic. Migration was a win-win process, equally benefitting migrants and their societies of origin. Migrants, it was stated, increased
their incomes fifteen-fold by moving from the South to the North – see Box 1
for definitions – the number of years their children spent at school doubled, and
infant mortality decreased fourteen-fold, all in comparison to the circumstances
they had left behind. At the same time, the remittances that migrants transferred
back to their families lowered significantly the local level of poverty, leading to
an improvement also in the health status of the children who had remained in
the country of origin (GoS 2014). Against this background, a reader could be
expected to ask her/himself why not everybody in the South would to try to –
indeed ought to – migrate to the North, given the apparently indisputable benefits to themselves and to the countries of origin.
The Swedish positive take on migration is brought even further by the UN
Development Program, UNDP, which strongly argues that migration is a winwin proposition:
migrants boost economic output, at little or no cost to locals [in the countries of destination]. Indeed, there may be broader positive effects, for
instance when the availability of migrants for childcare allows resident
mothers to work outside the home. […] In migrants’ countries of origin,
the impacts of movement are felt in higher incomes and consumption,
better education and improved health, as well as at a broader cultural and
social level.
(UNDP 2009:3)
Or, to follow the lead of the World Bank, which concludes in similar jubilant
terms that migration reduces poverty (although the poorest are not among the
most frequent migrants), increases expenditure on health and education, intensifies construction activities, and reduces vulnerability as it is counter-cyclical
(see the World Bank web site www.knomad.org).
Such win-win arguments herald a new understanding of migration, migration is no longer only (or mostly) seen as a case of brain drain, where migrants
take the education and the knowledge they have acquired at home and put
them to use to their own benefit, and to the benefit of the countries of destination. While the countries and by implication, the people who have paid
for the education, are left behind in abject misery. Piccture, for instance, the
situation of Haiti – a case frequently referred to – with the world’s highest
rate of high-skilled emigration. Today, migration is rather portrayed as a circular and mutually advantageous movement, whereby migrants after a (long or
short) spell outside their native countries, and after remitting significant sums
of money, return to their countries of origin, bringing rewards to both ends of
the migration process.
The varying takes on the phenomenon of migration, especially in connection
with its impact on development of the countries of origin, have followed closely
the changing understandings in development economics. In a Keynesian perspective, which dominated the first period after the Second world war (WWII)
the functioning of the developmental state was considered key, and the fact that
migration occurred was generally seen as indicating a failure on behalf of the
state’s development efforts.
6
But with the advent of the neoliberal development agenda in the 1980s – the so
called Washington Consensus – the importance of the private sector, and hence
of individuals, as generators of development and growth took precedence. Migration now was recast as a generator of resources for the promotion of individuals
and, indirectly, of societies. We may thus read the more recent win-win arguments in relation to migration – focussing as they do on migrant remittances –
as a vindication of the neoliberal development view. See Table 1 for a summary
of the main phases in the framing of migration and development.
Table 1. Main phases in the
framing of Migration and development post WWII
Period
Research community framing
Keynesian
until ca 1975–1980
Development optimism. Migration of surplus labour from
underdeveloped to developed countries beneficial to both, but
brain drain took a heavy toll on the developmental potential of
poor countries.
Neoliberal
ca 1980–2000
Development pessimism: brain drain, weak governance, poor
countries’ failure generates migration.
But also rise of “New Economics of Labour Migration” stressing an integrated world economy, mutually beneficial relationships, agency of migrants.
2000
and beyond
Win-win. Boom in attention and studies, more mixed positions
but generally a positive view: remittances large and countercyclical, well used in countries of origin, circular migration,
diasporas bring advantages to countries of origin.
Adapted from De Haas 2008: Table 1.
What is rarely discussed in this connection is the fact that migrants – we are
here concerned with persons who migrate in order to find employment abroad,
see Box 1 for delimitations – greatly contribute to the development of the destination societies. Indeed, an argument may be made to the effect that migrants
“give” more than they “get”, and that therefore migration is part and parcel of
a process of unequal exchange which will entrench the wide gaps in terms of
social conditions, wealth, power, and general development characteristics separating the North from the South.
This does not undermine the conclusion that migration may be beneficial to
the migrants, to their families and to their societies of origin to the extent that
economic, social and political “pay-back” occurs as a result of the migration.
But reducing poverty does not amount to the same thing as closing the “development gap”.
7
Box 1. Delimitations
and definitions
In this report, migrants are defined following the 1990 UN “International Convention on the Protection of the Rights of All Migrant Workers and Members of
Their Families” in the following way: “The term ‘migrant worker’ refers to a person
who is to be engaged, is engaged or has been engaged in a remunerated activity in
a State of which he or she is not a national” (Article 2.1).
This delimitation has three implications. First, it disregards internal migration,
which amounts to a little less than one billion people. It is the crossing of a border
which constitutes the defining characteristic of the group of migrants which are
focussed here.
Secondly, this definition of migrants excludes refugees, that is, persons who are
forced to leave their country of origin on account of persecution, war or catastrophes of various kinds. The rights of refugees are dealt with in separate international
conventions, and their presence in safe havens should not be assessed in the same
terms as migrant workers. Today, approximately 50 million people are refugees
according to this definition, including internal refugees; most of them reside in the
South.
Lastly, the length of stay of the migrants are left out in contrast to other delimitations which require that a person in order to be considered a migrant spends at
least 12 months in the country of destination.
We need to be equally circumspect when deciding what to call the opposing poles
of migration, from where it starts to where it (temporarily) ends: each dicho­tomy
carries with it a statement of driver and logic of migration, an implicit identification of what it is that turns a person into a migrant. Are the countries from where
migrants come to be called sender, home, or source countries? Are the countries at
the other end of the migratory process to be branded receivers, host, or destination
countries?
By choosing the terms we want to apply, we may inadvertently make a statement
of drivers and of agency, categorizing some countries as drivers while others
become passive recipients which play no role in the migration process.
For this report, the least loaded terms – countries of origin and countries of
destination – are used, stressing the direction of movement, not the cause of
migration.
Similary, although imperfect and dated, I will use North to refer to countries of
the OECD (including Europe, North America, Japan and Oceania), and South to
denote the countries of Africa, Asia (with the stated exception) and Latin America.
This partition is far from perfect, but statistical investigations mostly adhere to
this, or similar, socio-geographical groupings of countries.
Sources: UN 1990, UNESCO 2015.
8
MIGRATION:
How many,
origins,
destinations
Migration is certainly not a new phenomenon, but the attention given to migration and development by research and media has grown. In 1965, migrants totalled
approximately 75 million persons (excluding internal migrants, 50 million of
whom resided in what the South, with the remaining 25 million people living
in the North (Hollifield 2006: Figure 2). At this stage, then, migration was primarily a movement of people from a poor country to one of its equally poor,
and not too distant, neighbours.
Over the following decades, the numbers increased, reaching almost 200
million by 2005; concomitantly, migration flows took on a clear South à North
direction, with migrants to the North accounting for over half the total number. Migration thus increasingly mirrored the colonial pattern of sending minerals and agricultural products from the South to the North, and replicated, to
state the obvious, the transfer of labour during the slave trade.
In the period leading up to today, migration has continued to grow unabated, reaching 250 million by 2015. However, a new distinct geographic distribution of migrants has surfaced: today South à South is as important in terms
of people (but not in remittances) as South à North migration, reflecting the
growing economic importance of oil producing and fast growing economies of
the South which import workers in large numbers for industrial and construction purposes as well as for domestic work. Hence, migration of our times is
just as much a South à North as a SouthàSouth movement.
250 million migrants . . . with such an impressive figure it is easy to miss the
point that migrants (as always, excluding internal migrants) do not account
for more than 3 per cent of the global population, a share which in fact has
remained stable since the aftermath of WWII. This indicates that in spite of the
objective drivers of migration, almost everybody stays put in her or his jurisdiction of birth.
The geographical distribution of migrant flows, however, is not the same
thing as the distribution of migrant stocks, and the previous predominance
of intra-regional and intra-continental migration still leaves its imprint on the
geographical dispersal of migrant stocks. In four of the world’s continents, over
half of the residing migrants have come from the same region, in Africa the
share is as high as 82 per cent, see Table 2. Intra-regional, or intra-continental,
migration is thus the rule rather than the exception, and migrants still live in
proximity to their countries of origin, or at least on the same continent, the
only exceptions being North America and Oceania.
9
Table 2. Migrant stocks in
numbers and shares of intra­continental migration, 2013
Region
Stock of migrants,
millions
Intra-continental
­migration, %
Africa
19
82
Asia
71
76
Europe & Central Asia
72
52
Latin America
9
64
North America
53
2
8
14
Oceania
Total 2013
232
Source: UN 2014: Table 1.
Returning to the migration flows of today, “only” 43 per cent of Asian migrants
stay in Asia, attracted primarily by South Korea, Hong Kong, China, Taiwan, as
well as by Singapore, Thailand and Malaysia. This points in the direction of an
increasing globalization of migration. On the other hand, in Africa most migration is still regional, Côte d’Ivoire being the most attractive destination country
(receiving almost 8 per cent of all African migrants in 2010), followed by South
Africa, Burkina Faso, Nigeria, Kenya, Sudan, Uganda, Tanzania, Libya, Ethiopia
and Rwanda with 6 to 1 per cent of the migration flow. In fact, of the 20 most
popular destination countries for African migrants, 11 were in Africa (Ratha &
Plaza 2011:49).
10
­ emittances
R
– the origin
of the
win-win
view
Box 2. Defining migrant
­remittances
Behind the growing interest, and the surge of the win-win migration discourse,
there has been a growing realization of the importance of remittances which
migration gives rise to; see Box 2 for definitions.
The concept of migrant remittances is not difficult to grasp intuitively, and the International Organisation for Migration, IOM, simply defines it as “Monies earned or
acquired by non-nationals that are transferred back to their country of origin”.
A more technical definition is provided by the International Monetary Fund, IMF:
“Personal remittances” are made up of transfers in cash or in kind by resident to
non-resident households plus compensation to non-resident employees (that is to
temporary or seasonal staff). Add social benefits (including future pension payments)
and we get “Total remittances”, which is intended to capture all household income
obtained from working abroad, including income to be received in the future.
It should be noted that no distinction is made concerning the length of stay of the
migrant, which is in conformity to the delimitation of Box 1 above.
Sources: http://www.iom.int/key-migration-terms,
http://www.imf.org/external/np/sta/bop/remitt.htm
The amounts transferred have surpassed the growth in the number of migrants,
compared to the early 1980s migrants’ official remittances had by the early 2000’s
grown fivefold. The attention in the public sphere which this growth spawned is
even more impressive: the number of journal articles increased 3o times ( 19802005, Carling 2007: Figure 1). The media attention thus grew six times faster
than the actual remittances. Figure 1 sums up the picture. The most recent estimate of remittances to the South reaches the staggering sum of 450 billion USD
for 2015 (World Bank 2015).
Migrant remittances show three positive traits in comparison with other
flows to the South. First, they are large and growing, today outdoing the volume of development aid three times over; the only sizeable flow which is even
in the vicinity of the inflow of remittances are Foreign Direct Investments, FDI.
Secondly, remittance flows are “unrequited”, that is they do not cause any reverse flow in the opposite direction. This compares favourably with FDI (where
profits, dividends, and royalties may amount to just as much, or more, than the
original investment) and debt (where interest and amortization likewise takes a
heavy toll over the years, frequently surpassing the initial loan); not so when it
comes remittances (Kapur 2005:333).
11
Figure 1: Financial flows to
the South 1990-2014
Source: World Bank, http://blogs.worldbank.org/peoplemove/remittance-data-update-for-2011.
Thirdly, migrants’ remittances are more stable and less sensitive to external shocks
than most observers have postulated, not even the global financial meltdown of
2008 resulted in more than a minor dent in the rising remittance curve, much
less volatile than FDIs and debt flows. It is therefore mysterious that the World
Bank (2013), in its modelling of future financial flows to the South, pays but little attention to the role of migrants’ remittances (in contrast to the attention to
migration paid by other branches of the World Bank).
However, although migrants as a whole transfer impressive amounts, the
macro data may hide the uneven distribution of remittances to receiving countries, see Figure 2. Two countries figure prominently, India and China, the two
of them combined obtaining close to one third of total remittances globally.
And the ten major remittance recipients together account for as much as 65 per
cent of received remittance flows to the South, 281 billion USD out of a total of
435 billion USD in 2014.
12
Figure 2. Top receiving
countries
Source: World Bank 2015
But we should not focus only on the sums transferred, as remittances are most
important to countries with limited resources (se Table 2). Although the absolute sums by comparison with the countries listed in Figure 2 are small, they
nevertheless are crucial. Another way to gauge the importance of remittances is
to compare them to export earnings: in over 20 countries of the South, migrant
remittances exceed the foreign exchange earnings of their major commodity
export (UNDP 2009:78).
Table 3. The world’s most
remittance dependent economies, 2013
Country
Remittances received
as share of GDP, %
Tajikistan
49
Kyrgyz Republic
32
Nepal
29
Moldova
25
Tonga
24
Haiti
21
Armenia
21
Gambia
20
Lesotho
20
Samoa
20
Source: World Bank 2015
13
Another way of identifying the less-than-equal distribution of remittance flows
is to register them according to the level of human development of the destination country (the yardstick used by the UNDP). Here, there exists an impressive
mismatch between needs and available resources in the form of remittances: of
total remittances 2007, only a meagre one per cent went to the countries with
the lowest human development. This means that for this category of countries,
aid dependency is still much more important than their reliance on remittances,
with the latter accounting for only 15 per cent of the Official Development Assistance, ODA, they receive (UNDP 2009:78-9).
14
MIGRATION:
From
“drain on”
to “source
of” development – with
a gendered
gaze
Case 1. Forced Remittances
As noted, our attention should not only focus countries when it comes to assessing migration, as if states sent and received people, remittances, and returnees.
Rather, we should pay attention to the fact that migration is about individuals
moving, looking for work, and transferring part of their income to families and
dependents in the countries of origin. It is the links between these processes,
mostly driven by individual initiative and decisions, and the general implications
for the societies of origin as well as destination, which should catch our attention.
This may sound self-evident, but there has nevertheless existed a tendency,
at least in the economics literature, to concentrate on whether migration is
good or bad for development of countries and the economy as such. While the
equally central issue of whether migration may be an effective way to improve
living conditions of the migrants and the migrants’ families has been neglected,
or added as a secondary consideration. Worse still, some governments have
gone as far as to question the rights of migrants to keep the pay they receive for
their work, wanting to make sure that (part of ) the income was spent in the
country of origin rather than in the country where the migrants stayed, or that
the migrants were forced to return “home” in order to reap what they had sown
(see Case 1).
Before and after WWII, many migrants were ruled by policies designed to ensure a
return flow to the migrants’ countries of origin. For instance, US employers of Jamaican migrants were required to deposit 20 per cent of the wages due in a Jamaican
savings bank, money which could only be accessed once the migrants had returned.
Likewise, during the first years after WWII, 10 per cent of the wages of Mexican braceros (seasonal manual labour employed in Californian agriculture) were sent by the US
employer to the Bank of Mexico in a scheme which combined forced savings with an
attempt to secure that the braceros returned to Mexico after terminating their stint in
the US. However, when the returnees demanded the money owed to them, the Bank
of Mexico had no record of ever receiving it, nor could the handler, Wells Fargo, prove
that transfers had in fact been made.
It was to take until 2005 before the Mexican government agreed to pay compensation
to 49 000 claimants (out of a total of over 200 000 migrants who claimed that their
money had been seized, many of which could not provide the required documents to
prove their case).
Sources: IOM 2013, World Bank 2014.
Realizing the potential of the remittance flows changed government attitudes
towards migration and migrants. After spending decades lamenting the brain
drain caused by the emigration of highly educated Indians, migrants were suddenly depicted as “angels of development” (Castles 2007: 271). Rajiv Gandhi,
then prime minister of India, is reported to have claimed for his country the
income earned by Indian migrants, in a stand which mirrors the effective forced
remittance procedures described in Case 1, above: Indian migrants were considered as a bank “from which one could make withdrawals from time to time”
(Carling 2007:58).
Although it is certainly nicer to be seen as contributing to the development
of one’s country of origin than as “draining” it, the migrants themselves run the
risk of seeing the money they remit seized by the government in the name of
the “national interest” or “development”.
15
In a similar turn, the World Bank has come around to championing migration
as a boost to development, most recently in a “Global Knowledge Partnership
on Migration and Development”, Knomad:
At the household level, remittances have reduced poverty in many developing countries, and have raised expenditures on investment, health services, and schooling, while also enabling households to diversify their vulnerability to risks such as drought, famines and natural disasters.
At the macroeconomic level, remittances can provide a relatively stable
source of external finance compared to debt and portfolio equity flows
(Knomad 2015)
However, with phrases such as “At the household level”, the true complex nature
of what takes place within a household is obfuscated. Most importantly, there
is a tendency to counter-pose “productive” to “unproductive” expenses disclosing a clear gender bias. Reproductive costs of a family are relegated to the category “unproductive”, and thus seen as less “development-friendly” than spending migrants’ remittances on acquiring land, investing in agriculture, or starting
a business (Mahler & Pessar 2006:45-6).
Likewise, the household metaphor tends to hide the true nature of the gendered division of labour within households. On average, women make up half
the number of migrants globally, and in many cases, such as Peru, Cape Verde,
the Philippines, the Dominican Republic and Sri Lanka, they constitute the
majority (Calavita 2006:118). Still, the “household” is constructed as an entity
where men migrate and women stay behind (Mahler & Pessar 2006:27-28).
The growing role of female migrants should be seen against the gendered
global labour market, especially when it comes to the service sectors. This is especially clear in the “global care chain”: as retrenchments and cut-downs in the
public sector take place in the North, migration provides domestic servants and
public care-takers at affordable costs (to the employers, to the public sector),
constituting a gendered and socially stratified global division of labour, fuelling
migration for longer or shorter durations (Piper 206:145-6).
Here, the governments of the countries of origin are often complicit in the
establishment of this global network, most blatantly, perhaps. In the Philippines
where recruiting agencies were established in order to provide “a hardworking,
submissive and obedient domestic helper”, including promoting Filipina workers with light complexion, as the targeted employers might feel resistance, (it
was assumed), to contract “dark-skinned” nannies (Mahler & Pessar 2006:49).
16
What does
migration
contribute?
Individual
perspectives
One of the major factors driving migration is the large wage differences for jobs
with similar qualifications in countries of origin and destination. These gaps are
indeed significant, and “movers have much higher incomes than stayers”, according to the UNDP. A migrant who moves from a country with low human development (the indicator the UNDP uses to classify countries) to an OECD country
increases her/his monthly income by over 1 000 USD. For high-skilled migrants
– physicians, nurses, engineers, teachers – the prospects of migration are even
better, and moving from low to high human development countries for one of
these categories would increase monthly earnings by approximately 3 300 USD
(income adjusted to purchasing power parity; UNDP 2009:50).
No similar improvement by staying put in the country of origin is to be foreseen for poor people, even if we assume a pro-poor, anti-poverty policy implemented by a reliable, competent and benevolent government. To take but a few
examples of the benefits reaped by the migrants (culled from Clemens et al.
2008, and IOM 2013):
• Just through a couple of weeks on the US labour market, migrants from
Bangladesh, Indonesia, Bolivia or Kenya will improve their lot by as
much as: improved access to micro-credit, improved schooling, and
improved health status combined could achieve in their respective countries of origin over their entire life spans.
• A Bolivian worker moving to the USA will increase his/her estimated earnings by a factor 0f 2.7; an average Nigerian by as much as 8.4 times.
• A nurse who moves to the USA from the Philippines will increase her/his
earnings twentyfold compared to the urban areas of his/her country of
origin, and by as much as 35 times compared to rural settings. One outcome of this is that Filipino physicians are said to be re-training in order
to be able to emigrate as nurses and thus increase their income by a factor of four (compared with what they make as medical doctors in the
Philippines).
Similar drivers of migration also exist within the European union as well as in
Ethiopia, see Cases 2 and 3.
17
Case 2. Roma migrants in
Spain, Italy, and Scandinavia
After the accession of Romania and Bulgaria to the European Union in 2007, Roma
migrants have sought out EU countries for mostly short-term migratory moves. Surveys of Roma migrants in Spain and Italy, carried out in 2011, indicate that migrants
remit significant amounts to their families, but they also show that the standing of
Roma migrants differs in important ways from one destination country to another.
The picture is far from clear: Roma in Spain transferred an average of 570 euro annually, while Roma in Italy remitted as much as 1 400 euros. One explanation for this
difference may be that Roma in Spain are better integrated and live safer lives – judging from their housing situation, access to social security and legal status – compared
to Roma in Italy. Thus, one may speculate, Roma in Spain may have a longer time
horizon for their stay, leading them to adopt a more long-term strategy, while Roma
in Italy may play it safe by transferring more at an early stage, as their situation may
be more insecure.
A recent survey of over 1 000 Romanian, mostly Roma, migrants in Oslo, Copenhagen and Stockholm, shows that the sums the migrants manage to get by street begging
are quite limited, a daily average of 130 SEK (approximately 14 USD) was reported. Still,
such amounts are enough to “make the difference between food and no food, health
service and no health service, school or no school” in the migrants’ communities of
origin in Romania.
In addition to paying for essentials such as these, the migrants’ earnings were spent on
food and clothes, and in maintaining their houses; a considerable share of the income
was used to pay for the transfer from Romania to Scandinavia and back, and to pay
off debt.
Source: Vlase & Preoteasa 2011, Djufve et al. 2015.
Although some of these examples may be exceptional, it is difficult to disagree
with the following general conclusion, at least in the short run, which to most
migrants probably is the most important consideration:
no existing policy carried out [in the country of origin] can benefit the
marginal poor household as much as one year of access to the US labor
market.
(Clemens et al. 2008:41)
In fact, migration can be seen as an investment strategy pursued by people in
poor countries, one with the highest possible rates of return:
Migrants from poor to rich countries can multiply their real earning
potential by between 3 and 10 times. […] the most lucrative investment
available to many of the poor.
(Clemens & Ogden 2014: 13, 17)
The significance of viewing migration this way – as an investment, as a strategy
used by people to improve their prospects and living conditions in the countries of origin as well as in the countries of destination – is brought home by
comparing the real wage – i.e. the nominal wage expressed in purchasing power
terms – for similar trades that the migrants can earn in the centres of origin and
destination. For instance, a construction worker makes nine times as much in
18
London as in Nairobi, a skilled industrial labourer increases her/his wage fourfold by moving from New Delhi to New York, an engineer is rewarded four times
more in London than in Beijing (Milanovic 2011: Table 1). This is one aspect of
the potential win-win-win nature of international migration: it improves the living conditions of the migrants, at least in monetary terms, and simultaneously
decreases the global income gap.
Case 3. Migrating from
­Ethiopia
According to a recent survey, emigration from Ethiopia has changed its characteristics,
and thus that of the Ethiopian diaspora: what started out mostly as emigration of
well-educated male political refugees has today increasingly become female migrants
looking for domestic jobs in the Middle East and in neighbouring Sudan. The dominant reason stated for migrating to the Middle East and Africa was looking for work,
while the migrants who opted for the OECD also gave education and family unification
as driver for migrating.
60 per cent of surveyed Ethiopian migrants transfer money to their families in Ethiopia, the share is lowest for migrants in Africa. The remitting frequency increased with
the time the migrants had spent abroad, indicating that the first use of migrants’ earnings is repayment of the cost of migration.
Remittances received amounted to 875 USD per family on average, but twice that
amount from migrants in the OECD, and less than that for migrants in Africa. 45 per
cent of the remittances received were spent on daily consumption needs, and only
small amounts were set aside for education or other investments; only rarely did remittances finance repayment of loans and social expenses (such as weddings, funerals).
Source: Andersson 2015.
Cost of remitting
A drain on the resources which migration generates which is suffered by most
migrants is caused by the high charges that banks and financial institutions levy
on the transfer to the country of origin. A publicly embraced goal of reducing
the costs in 5 years to 5 per cent has been set, but is yet to be realized. The Sustainable Development Goals – agreed by the UN in September 2015 – include an
objective of further reducing the transfer costs to 3 per cent. See Case 4.
19
Case 4. Migration and the
link to the Post 2015 Agenda:
Sustainable Development Goals
and Financing for Development
The Post 2015 Agenda consists of the two processes of Sustainable Development
Goals, SDGs, and Financing for Development, FfD, adopted in 2015.
During the Post 2015 process, global civil society organisations, CSOs, have urged
for an enhanced focus on migration and migrant’s rights in relation to development.
Migrant’s remittances, migrant workers or migrant’s creation of jobs exemplifies areas
where there is a prerequisite to advance towards a sustainable, people-centred development. Remittances are often defined as drivers of economic development, although
neglected in the development context while linking social and personal costs with
migration. Similarly, in the synthesis report “The Road to Dignity by 2030”, UN Secretary Ban Ki-Moon repeatedly emphasize the importance of migrants and migration.
In September 2015, the UN member states agreed on the Sustainable Development
Goals. In a large participatory process, a new set of goals was developed to replace the
Millennium Development Goals, MDGs from 2000. Notably, the MDGs failed to fully
include and integrate migrants and the link between development, human rights and
migration.
The SDGs will implement the MDGs that were not yet fulfilled and the new goals are
universal and comprehensive, to be achieved by 2030. Commonly recognised as the
‘Agenda 2030’, the declaration includes 17 goals and 169 targets. In particular, Paragraph 29 incorporates migration and the rights of migrants in the declaration:
“We recognize the positive contribution of migrants for inclusive growth and sustainable
development. We also recognize that international migration is a multidimensional reality of major relevance for the development of countries of origin, transit and destination,
which requires coherent and comprehensive responses. We will cooperate internationally to ensure safe, orderly and regular migration involving full respect for human rights
and the humane treatment of migrants regardless of migration status, of refugees and
of displaced persons. Such cooperation should also strengthen the resilience of communities hosting refugees, particularly in developing countries. We underline the right of
migrants to return to their country of citizenship, and recall that States must ensure that
their returning nationals are duly received.”
(Draft outcome document of the United Nations summit
for the adoption of the post-2015 development agenda, Paragraph 29)
Despite civil society efforts, the declaration lacks a strong language in the perspective
of labour rights, as fair treatment of migrants should have been incorporated into the
declaration in order to meet the human rights obligations of the signatory states.
In the overall declaration of the SDGs, migration and migrants are not fully capitalised
nor put in the factual framework. Rather, the issues of migration and migrants are
constrained to only be visible under Paragraph 29 and Goal 10 – ‘Reduce inequality
within and among countries’. Goals 10 indicates that UN member states should:
”Facilitate orderly, safe, regular and responsible migration and mobility of people,
including through the implementation of planned and well-managed migration policies”
(Draft outcome document of the United Nations summit
for the adoption of the post-2015 development agenda, Paragraph 10.7)
20
Subsequently under Goal 10, the only quantified objective to be found in the SDGs is
regarding remittances. Goal 10 shows that:
“By 2030, reduce to less than 3 per cent the transaction costs of migrant remittances and
eliminate remittance corridors with costs higher than 5 per cent.”
(Draft outcome document of the United Nations summit
for the adoption of the post-2015 development agenda, Paragraph 10c)
The Post 2015 agenda will design and implement a framework of indicators that will
be a key to provide reliable information for follow-up and review. Indicators will be
developed during Autumn 2015 and agreed upon during Spring 2016.
The Third International Conference on Financing for Development was held in Addis
Ababa in July 2015. The UN member states agreed on the outcome of the Financing for
Development in the Addis Ababa Action Agenda (AAAA). AAAA is set to be the framework on how to finance the SDGs and development.
AAAA makes two explicit references to migration in terms of remittances and transaction costs and as a multidimensional reality of development. Paragraph 111 initiates,
in less concrete terms, to facilitate the portability of earned social benefits. These
include circular migration and recognition of foreign qualifications and skills, which
would ease access to the formal labour market.
In comparison with the SDGs, remittances and transaction costs are further detailed in
Paragraph 40 of the AAAA. Additionally, a positive contribution of migrants for inclusive growth are recognized as well as a statement that remittances cannot be equated
to other international financial flows such as foreign direct investment, ODA or other
public funding’s. Paragraph 40 indicates:
“[…] We will work to ensure that adequate and affordable financial services are available
to migrants and their families in both home and host countries. We will work towards
reducing the average transaction cost of migrant remittances by 2030 to less than 3 per
cent of the amount transferred. We are particularly concerned with the cost of remittances in certain low-volume and high-cost corridors. We will work to ensure that no
remittance corridor requires charges higher than 5 per cent by 2030, mindful of the need
to maintain adequate service coverage, especially for those most in need. We will support national authorities to address the most significant obstacles to the continued flow
of remittances, such as the trend of banks withdrawing services, to work towards access
to remittance transfer services across borders. […]”
(Addis Ababa Action Agenda, Paragraph 40)
Emelie Aho, Policy Advisor on Swedish Development and Aid, Forum Syd
Today, the transfer cost is still 8 per cent on average (with a weighted average
of 6 per cent), but the cost of remitting to poorer countries of origin is higher
than the average Remittances to Sub-Saharan Africa are charged an average of
12 per cent, and some exceptional “transfer corridors” charge as much as 20 per
cent. Although the situation has improved, the value lost in transfer is still huge,
approximately 36 billion USD (World Bank 2015, 2015b).
A related issue is how unfavourable and unforeseeable exchange rates moves,
when the currencies of the major countries of destination fall, migrants lose
significant amounts (World Bank 2015:6); this constitutes a clear risk borne by
the migrants alone.
21
What does
migration
contribute?
National
perspectives
Apart from the huge sums concerned in migration remittances, their rela-tive
stability is a beneficial trait to the countries of origin (see Figure 1): remittances
have proved more stable even during the global financial crisis than other flows
(with the exception of ODA). The resilience of remittances is a general phenomenon. While capital flows decline on average by 15 per cent during the first
year of a “sudden stop period” – a nice euphemism for “crisis” – and then goes
on to fall another 10 per cent in the following year, remittances instead as a rule
increase by 7 and 6 per cent, respectively (World Bank 2015a:177).
A close examination, based on a case study of migrant remittances from Italy,
bears this out in greater detail (Bettin et al. 2014). Firstly, and perhaps not so
surprising, remittances from Italy 2005-2011 to 87 countries of origin turned out
to be counter-cyclical and increased when conditions in the countries of origin
deteriorated. Remittances thus managed to alleviate the distress at the point of
origin, for instance when terms of trade moved against the exports of the economy of origin, or when a natural catastrophe had struck there.
Secondly, and more importantly, when both the economies of origin and
destination were affected by the same negative shock, migrants nevertheless upheld their solidarity with their place of origin. In fact, during the 2008 financial
crisis and its aftermath, remittances grew a little faster than before.
The conclusion seems unavoidable: remittances contribute to ease the consequences of financial turmoil and economic downturn as far as the impact on
the countries of origin is concerned. Nevertheless, dependence on one source
may constitute a risk for the countries of origin, in addition to the risk of fluctuating exchange rates noted above. For instance, when the value of remittances
transferred by Moroccan migrants from the Netherlands fell by close to 60 per
cent 2001-2004, the impact in Morocco was quite severe, just as when Turkish
migrants in Germany transferred 80 per cent less in 2004 compared to two
years earlier (Carling 2007:56-7).
A related issue has to do with how remittances are spent, whether they are
put to “good use” or not. As we have seen, from the perspective of the individual
migrant, the evidence points in a favourable direction, migrants’ families spend
the money well. How beneficial migrants’ remittances are for the general development of the country as a whole is however a different matter, and one that is
not easy to address. From a national perspective, a way to assess the potential of
remittances is to make the unlikely assumption that they would entirely be used
to finance investments. Given the volume of migrant remittances, the potential
is staggering: if remittances to Sub-Saharan Africa, SSA, were comprehensively
turned into investments, the SSA investment rate would rise by as much as 40
per cent, from 21 to 30 per cent of GDP (World Bank 2011).
However, to calculate the prospective benefits of migration for the general
development of the countries of origin in this way is totally unrealistic, since
the actual funds transferred rest – or should rest – in the hands of a multitude
of migrants and their families, to be used as they see fit. One consequence of
migrants transferring significant sums of money, is that the local banking system may develop, which would benefit also non-migrants who need to access
finance for various investment purposes.
The potential use of migrants to the societies of origin has however wrongly been
focussed on the financial aspects of migration, while there are other circumstances
to factor in when it comes to assessing the impact of existing migrant commun-
22
ities in countries of destination, so called diasporas. In addition to financial
benefits, social and even political “remittances” can play a key role in stimulating development and positive change in the countries and communities of origin; see Case 5 for the Somali example.
Case 5. The Somali Diaspora:
monetary, social and political
remittances
The various diasporas of Somalia annually transfer approximately 1.6 billion USD,
amounting to 45 per cent of the country’s GDP. This greatly exceeds the total sum
for humanitarian aid to Somalia, which reached 800 million USD at its highest. Also
in Sweden, the Somalian diaspora is active when it comes to mobilizing capital and
human resources. More than 800 Diaspora Civil Society Organisations, CSO, which
promote and engage in relief and developmental assistance in Somalia and Somaliland
are registered in Sweden alone.
Each year, the Somalian diaspora in Sweden remit 60 million USD to relatives in Somalia
and Somaliland; this is almost twice as much as Swedish development assistance to the
country, and enough to feed 100,000 families. Diaspora communities in the Netherlands, Germany, the United Kingdom, and the USA remit several times this amount
each year.
Remittances make a significant contribution to Somali household income and food
security. In Puntland and Somaliland, an estimated 40 per cent of families depend on
remittances to meet their daily food security needs. The money sent to Somalia by the
diaspora have contributed to poverty reduction and thus to achieving the Millennium
Development Goals, MDG. They have been used for food, health care, housing, development, training and support to family members.
The diaspora is often the only body that continuously supports a specific area or community. Since members of the diaspora possess a deep understanding of the context
and of their country of origin, their work is based on local needs and conditions. This
is why many states and international organisations are turning their attention to the
role of diasporas in the development of their countries of origin: diasporas constitute
an efficient and effective complement to international cooperation to reduce poverty
around the world
Besides financial contributions, the diasporas also support development and poverty
reduction by transferring new knowledge, experiences, techniques and contacts. When
migrants return, for however short a time, they bring with them the knowledge and
experience they have acquired. An example that illustrates the role of the Somalian
diaspora in transferring knowledge is the work of the Somali-Swedish Researchers
Association. The organisation is composed of Swedish Somalia medical researchers who
work on a broad front with different local actors to influence clan leaders, birth attendants and religious groups to ban female genital mutilation.
Again, the Swedish case is illustrative: the Somali-Swedish Researchers Association
has together with the local organisation drafted a proposition for the Somaliland parliament on the prohibition of female genital mutilation. The proposition is currently
under consideration by the parliament.
Similarly, the doctors, psychologists and scientists within Swedish Somali Research
Association, are continuing its efforts with Amoud University to improve health care
for mothers and infants by producing a training programme for midwives. This will
enable women to claim their fundamental rights to health, and to take part in the
decisions that affect their own health and that of their children, as well as providing
training to their colleagues with knowledge on providing affordable psychological treatment.
23
In addition to knowledge and contacts, diasporas contribute social and political
”remittances”, that is they bring political and social norms and standards to their
countries of origin. For a long time, members of the diaspora have been returning
to Somalia and Somaliland to take part in the development of the countries. The
involvement of the diaspora in Somalia dramatically increased since the Arta peace
conference held in Djibouti in 2000 which provided a real opportunity for the diaspora to play a meaningful role in Somali national politics.
The Somalia and Somaliland diasporas have actively taken a role in this development
process. The Diaspora is a driving force in steering the countries away from the
monopoly of the armed groups and aiding in empowering unarmed civic actors and
in supporting the growth of CSO.
In the case of Somaliland, the diaspora has always played an important role in the
political destiny of the country. For example, two of the main political parties in the
were founded in the diaspora, Justice and Welfare Party, founded in 2001 by Faysal
Ali who still is chairman of the party, and Wadani, founded by Abdirahman Mohamed
Abdullahi, also today the chairman. In general, about half of the men who make up
the governing bodies of Somalia and Somaliland – heads of state, prime ministers,
ministers on national as well as on provincial level – come from the diaspora. The role
of the diasporas in the parliaments is impressive, especially in Somalia where diaspora
members constitute 50 per cent, although their presence is considerably less in the
regional assemblies (Ismail 2011).
Text: Mussie Ephrem, Project Support Officer,
The Horn of Africa and Kenya, Forum Syd.
24
Risks and
drawbacks of
migration:
individual
and national
perspectives
Migrants lead dangerous and precarious lives. The migrant card is frequently
played when countries enter dire straits, or when political discontent has to be
re-directed: blame the foreigner, the migrant, the minority, for taking the job,
or for eroding a supposedly homogenous culture by bringing “foreign” elements
and concepts into the mainstream. Large-scale and sweeping expulsions may
follow. For instance the ousting of Nigerians from Ghana in the late 1960s, the
expulsion of Ghanaians from Nigeria in the 1980s, the closing of the border by
apartheid South Africa to Mozambican and other Frontline states’ migrants to
the South African mines and farms following the downfall of Portuguese fascism
in the late 1970s and early 1980s, or the expulsion of 800 000 Yemeni migrants
from Saudi Arabia. More recently, Singapore has tightened its immigration regulation and is now forcing employers to give priority to Singaporean labour before
they turn to immigrants, an indication of what may come to pass also in Europe
(World Bank 2015:7).
However, the fact that migrant remittances were upheld in the aftermath of
the financial crisis of 2008, in spite the many forecasts that migrants would be
the first to lose their jobs, indicates that the global economy has entered a new
phase where migrant labour simply is essential to the workings of the system,
turning the idea of forcefully evicting millions of migrants from the economic
centres of the world into an unrealistic proposition, no matter how much xenophobic sentiment in destination countries may be mobilized.
Brain drain/gain/waste
The most important – and studied – drawback in connection with migration is
the cost of losing educated and resource-rich people, two assets which are much
in demand in the countries of origin. Such “brain drain” has been a frequent
argument against the potential benefits of emigration, basically arguing that it
is only the countries of destination which profit from migration. In a classic
economics textbook from the 1950s, Theory of Economic Growth, written by the
Nobel laureate W Arthur Lewis, himself originally from Saint Lucia, the “economic difficulty” of emigration is framed thus:
The largest proportion of emigrants consists of people in the twenties and
thirties. The country has to bear the cost of rearing and educating them,
only to lose them when they reach working age.
(Lewis 1954:360)
A mitigating factor, Lewis recognized, consisted of the flow of remittances arising
from these educated and well-trained emigrants, thus presaging what later was to
become the dominant strand in the migration-development discourse (see Table
1, above). It should also be noted that brain drain may not be permanent, that
is educated and skilled emigrants return to their countries of origin, sometimes
in a circular pattern of migration, at other times on a more permanent note. It
has been assessed that about half of skilled migrants return after approximately
five years abroad (UNDP 2009:77).
Recent studies confirm the importance of the brain drain phenomenon (here
defined as migrants with post-high school education, which probably is too
narrow a definition since secondary school as well as vocational training qualifications in many instances must be considered a scarce resource) – to the
countries of destination. In 2000, 62 per cent of the skilled migrants (that is,
25
migrants holding post-secondary school education) to the OECD came from the
South. This also means that skilled persons in the South have higher emigration rates than the population in general, 7 per cent against 1.5 per cent of the
respective groups. For some regions, the emigration rate for skilled migrants
(following the above definition of highly-skilled) is striking, especially in the
Caribbean with 43 per cent of the skilled population abroad stands out, but
also Sub-Saharan Africa (with 13 per cent) and Central America (17 per cent)
testify to the importance of the brain drain. A telling fact is that highly-educated women have a greater propensity to migrate than their male counterparts, this
holds for Afghanistan as well as for Ghana and Guatemala; the explanation could
be that women have greater difficulties than men of finding suitable employment without migrating (UNDP 2009:77).
Brain drain is the most serious for countries with small populations: countries with less than 2.5 million people had a brain drain rate of 28 per cent (that is
28 per cent of their skilled population had emigrated), and for countries with 2.5
to 10 million people, the rate was 15 per cent. Similarly for individual countries,
brain drain may be the dominating aspect of migration, for instance for Haiti
(with 83 per cent of its highly skilled population abroad), Sierra Leone (49 per
cent) and Ghana (45 per cent; Docquier et al. 2007, Docquier & Rapoport 2012).
These are exceptional cases, however, and the significance of brain drain on
countries of origin on average is still hotly debated (except in such extreme cases
as mentioned above). For instance, if the alternative for high-skilled migrants
is to remain at home without any prospects of finding a suitable employment,
migration will be a win-win proposition.
Today, the migration literature tends to consider not only brain drain but
also brain gain: as the prospect of migration increasingly lies within the reach of
ever more people. The drive to acquire the knowledge and training which is valued in the immigration countries strengthens the local urge to study and to gain
practical experience, an indirect brain gain opened up through the prospect of
future migration (Sandefur 2014). Thus, emigration may be accompanied by a
boost in education in the country of origin.
In addition, a study of 33 000 migrants in 11 major destination countries
shows that higher education leads to larger remittances (Bollard et al. 2011,
which contradicts the much quoted OECD 2007 report, which claimed that low
skilled migrants remit more than higher skilled). The difference is substantial
to the benefit of the higher educated: while the average annual sum remitted
(the country studies are mostly from 2005–2007) is about 730 USD, the higher
educated send 40 per cent more, approximately 1 000 USD.
On the other hand, if well qualified and educated migrants do not end up
holding appropriate jobs, the potential of brain gain will partly be lost. The evidence in this respect is that over-qualification – the OECD-term for having more
education than a specific position requires – is common in countries of destination. Worse, and testifying to discrimination on the labour market: in every
single one of 25 OECD countries, immigrants had higher rates of over-qualification than natives, most notably so in Sweden (see Case 6). Thus, we may talk of
migration constituting a “brain waste” as the positions migrants get frequently
do not match their qualifications (Castles & Ozkul 2014:45). But also here it
must be remembered that similar situations of “waste” exist also in the countries
of origin, irrespective of if people choose to migrate or not.
26
Case 6. Migrants on Sweden’s
labour market
One of the central issues concerning migrants and employment is whether the jobs
migrants acquire match their qualifications. In Sweden, the degree of over-qualification (defined as a person having two more years of schooling than required for the
position she/he holds) among migrants is frighteningly high: 7 out of 10 Latin American, and 6 out of 10 African and Asian immigrants were over-qualified in 2010-2012.
The situation is not unique, but Sweden is exceptional in that the over-qualification
rate for migrants was 2.5 times higher than for natives in 2000, and this gap is the
widest in all of OECD. The explanation is that migrants in Sweden to a relatively high
degree are political refugees, who are comparatively well-educated, while they for
socio-psychological and xenophobic reasons, have difficulties to find jobs which match
their qualifications.
An important issue is how long it takes before migrants manage to get a foothold on
the open labour market. Although most migrants – irrespective of their geographic
origin – find employment eventually, migrants from Africa remain outside formal
employment for twice as long as migrants coming from the EU, four as compared to
two years on average. Sweden stands out also in the sense that migrants in Sweden
may remain unemployed to a much greater extent than in most other European countries, also after living in Sweden for ten years.
In addition to the high degree of refugees among migrants to Sweden – approximately
twice as high as in other European countries – the structure of the Swedish labour
market, with its low degree of unqualified jobs – keeps new migrants in unemployment to an unusually high degree. Still, there also exists an important component of
discrimination, as evidenced by the practice of job seekers to adopt “Swedish-sounding” surnames, which has proven conducive both to gain employment and higher
wages.
Sources: Le Grand & Karlsson (nd), Andersson Joona et al. 2012,
OECD 2007, Karlsson & Tibajev 2014, Szulkin 2012, Lundborg 2012.
The main point here is not only the inequity of the situation but equally that
over-qualification among migrants is common, albeit within a wide span. Of the
foreign-born immigrants 20-25 per cent were over-qualified in Australia, Canada,
Germany and Italy, while the worst cases were Greece and Spain with over
40 per cent; in the UK, USA, and Sweden, the over-qualification rate was below
20 per cent (OECD 2007: Table II.2). So, although the relative difference between
natives and immigrants is the widest in Sweden when it comes to over-qualification, the overall level of over-qualification is not the worst.
Charges imposed on migrants
We have seen that migrants potentially stand to reap large, not to say huge,
increases in earnings simply by moving from country of origin to country of
destination, but there are also economic costs involved (leaving aside psychosocial and emotional downsides). Migrants frequently have to pay to arrange their
transfer to the country of destination, (and we also know from daily catastrophes
in the Mediterranean, that all too frequently they have to pay the highest price,
death). Transfer charges are substantial, also for legal migrants who go through
public channels. Adding the fees charged by recruitment agencies, transporters,
medical examinations, passports and visas, the costs on average amounts to 3 000
USD (with variations, see World Bank 2012: Table 3).
27
Such costs take a considerable chunk off the earnings of each individual migrant,
and the pay-back period can be as long as the entire first year’s income, or more.
For instance, an average Indonesian migrant to Taiwan would need 14 months
to pay for her/his transfer expenses, and a Bangladeshi construction worker in
the Middle East will only be able to recover the transfer costs after 15 months
(with a monthly wage of 200 USD). In the meantime, the migrants run up debts
for accommodation, food, and other daily expenses, which all means that they
will have to spend maybe the first two years just to reach break-even (UNDP 2009:
Figure 3.6).
Still, these figures are serious underestimates of the actual costs for some
of the migrants. Evidence from Sweden point to the fact that migrants pay as
much as 15 000 USD (120 000 SEK) in order to reach the Swedish border, most of
this is the cost of obtaining a fake Swedish passport (DN 2015). The remainder
of the cost is charged by the smugglers, who, as has become evident especially
for the migration “corridor” over the Mediterranean, nevertheless endanger the
very lives of the migrants they exploit.
28
Putting
the picture
together
Table 4. Mis- and preconceptions vs Facts
While the jubilant pro-migration position is far from the whole truth concerning the Migration – Development Nexus, it has nevertheless rightfully become
part of – but not equal to – our understanding of the potential of migration in
terms of its contribution to survival strategies for individuals, families and households, as well as for entire societies and nations. Table 4, below, is an attempt to
put the picture together by debunking some mis- and pre-conceptions which
are endemic in the literature, and above all in public discourses as it is reflected
in media reporting on migration.
Issue
Mis- and Pre-conception
Facts
Migration
and Development
Poor countries are sending, rich countries are
receiving.
Some countries like China and India are
simultaneously countries of origin and
destination. Proximity between origin
and destination countries is an important factor in deciding migratory flows.
Gender of
migrants
Most migrants are men,
women stay at home and
receive in the best of cases
remittances.
Migrants are almost equally divided
between men and women; some
“migration corridors” are dominated by
women, for instance domestic work in
the Middle East, Ethiopian domestic
workers in Sudan.
Direction of
migration
Migration is South à
North, driven by the pull
of wealth and the push of
poverty.
South à South migration (37 per cent
of total) is equally important in numbers as South à North (35 per cent)
in 2013. North à North migration
accounted for 28 per cent of total migration flows in 2013.
Remittance
flows
Remittances flow North
à South.
Remittances South à South (34 per
cent) are as important as North à
South (38 per cent) in 2014.
Remittances North à North accounted
for 28 per cent of total in 2014.
Importance
of remittances
The large receivers are the
major emigration countries of the South.
Yes, but remittances are more important
to small economies which export a relatively large shares of their populations.
Relative
prominence
of migration, I
The number of migrants is
high at 250 million.
Yes, but the number of migrants has
remained stable for decades at around 3
per cent of global population.
Small countries are more dependent
on migration than populous in relative
terms.
Relative
prominence
of migration,
II
Countries of origin are
totally dependent on their
emigrants.
Emigrant stocks may reach 9 per cent
of population of sending countries (Sri
Lanka mostly to Saudi Arabia) but is
usually much lower: The Philippines 5
per cent, South Korea 4 per cent (mostly
to the USA).
29
Brain drain?
Countries of origin loose
high-skilled labour.
Yes, but also in countries with the highest rates of skilled migration, the number of students in secondary and tertiary
education increase. This also holds true
for the worst case, Haiti.
Sources: World Bank 2015, Sandefur 2014.
A new context, a new future
As we have seen, the attention accorded to the Migration and Development
Nexus, although not novel, has grown concomitant with the realization that huge
volumes of migrant remittances are flowing continuously from the North to the
South (as well as within the South, a fact which however goes underreported),
and that these flows continue also in the face of financial and economic crises.
But this is not the only explanation why Migration and Development has become
a hot topic. The resurgence of the debate concerning Migration and Development has also a lot to do with the growing nationalism which has made itself felt
in Europe during the last decades (witness the rise of xenophobic and ultranationalist parties in Denmark, Finland, France, Hungary, Italy, the Netherlands,
Norway, Sweden, unfortunately the list can be made longer).
One prominent representative of the anti-migration trend is, surprisingly,
the renowned development economist Paul Collier, known for his compassion
for the poorest people on the planet, the bottom billion (to quote the title of
one of his books). Collier has recently come out in favour of preserving the
ethnic homogeneity of countries as “high diversity has been a handicap […] in
most societies for most of history” (Collier 2013:272). Consequently, he advocates a cap on migration and that destination countries should select and favour
the most productive and highest educated for admittance. This, he claims, is an
act of “compassion”, as otherwise hundreds of millions of people would swamp
the rich countries, and compete against each other for the few jobs there are.
Collier reaches this conclusion with the help of a poll where 40 per cent of the
respondents in the South say they would like to migrate to the North if only
they could. It follows, he alleges, that emigration from poor countries will
“accelerate” until the South is “substantially depopulated” (Collier 2013:251).
At the other extreme, a pro-migration stance may be construed to reach the
equally mis-leading conclusion that emigration always is beneficial, and that no
positive moves are needed in order to protect the rights and interests of migrants.
This is evident from the piece of advice offered by World Bank in a new study
of what policies work to enhance the positive impact of migration. The recommendation provided by the World Bank is that countries of destination should
abstain from according labour rights and minimum wage protection to migrants,
since this “reduces the opportunity to migrate”. And following the same logic,
both emigration and immigration countries are told to avoid spending too much
time on language training of migrant workers as such support only comes “at relatively high costs” (McKenzie & Yang 2014: 31). The stance is difficult to square
with the World Bank’s alleged commitment to promote human rights
However, we need not end up in either of these camps – closing the borders to migration, or refusing migrants’ elementary social and human rights
– a middle ground certainly exist, where migration can be made mutually
30
advantageous to migrants and their families as well as to the countries of origin
and destination.
Win-Win I: Diasporas and Home Town Associations
One way to make sure there is a win-win-win situation concerning migratory
flows is to stimulate the creation and activities of Home Town Associations.
The diaspora organisations keep their social, cultural, economic and emotional
links to their countries and communities of origin (see Case 5 for the Somali
Case). Studies show that the will to keep the linkages with history and one’s
origin do not wane significantly over time – at least not for the first generations of migrants– but may on the contrary be strengthened as immigrant
communities become more established and better-off (Portes 2007: 25). Also,
the increased frequency of circular migration – where migrants move back and
forth between countries of origin and destination – testifies to the possibilities
to keep up the contacts.
The establishment of “migrant corridors” – more or less official routes of access for migrants from countries of origin to countries of destination– have often been combined with local community work. A characteristic noted already
for the early waves of immigration to the United States, where mostly women,
(for instance in Chicago in the late 19th and early 20th centuries, made sure
that schools, churches and philanthropic groups were organised, thus creating a
kind of “ethnic public sphere”, equally independent of the destination state as
of charity organisations run by the majority population (Sinke 2006:92).
Most advanced in this area are the countries where large migration movements have taken place for a long time, and where the governments of origin
have come to embrace migration as a reality that is here to stay. Such networks
not only ease the entry of new arrivals, but also increase mobility overall. For instance when Cape Verdean women establish inter-continental networks which
enable them to escape from, and find alternatives to, abusive employers, with
mobility as their “principal tool of resistance”. Also Somali female migrants
have established “networks of solidarity”, connecting Somalia to neighbouring
countries, and then onwards to the Middle East, Europe and North America
(Calavita 2006:123, and Case 7).
The step from seeing “ethnic resources” as primarily facilitating the first steps
of migrants into the destination society to using these networks in order to re-connect with the places of origin, is not a long one. Home Town Associations, HTAs,
and professional associations – such as “The Ghanaian Doctors and Dentists
Association” in the United Kingdom – play important roles in various respects,
from providing voter registration for migrants, thus strengthening their possibility to exercise their democratic rights, to the training in migrants’ native languages, in addition to channelling funds to the societies of origin.
As always, however, we must beware not to overstate their importance, the
participation in HTAs varies greatly among migrant collectives, from a dismal
one per cent in the case of Bolivians in the USA, to an impressive 63 per cent for
Filipinos in Hong Kong (Orozco & Rouse 2007).
31
Case 7. Kowsar Aden, SwedishSomalilander
Kowsar Aden is a Swedish-Somalilander woman, 32 years old, a single mother with
three children. She works as a consultant and supports, in addition to her own family, her mother and her siblings in Hargeisa. Since 1998 she has sent 200 USD each
month. The money is used to cover the basic needs of eight of her siblings, covering
the cost of food, water and school fees.
Kowsar’s mother, a widow since 1988, supports her family by working as a midwife
in Hargeisa, earning 50 USD per month. The remittances received from her daughter
in Sweden thus constitute a crucial lifeline for the whole family, without them they
would have difficulties to survive.
Text: Mussie Ephrem, Forum Syd
The sums transferred by HTAs can be quite substantial. Although Mexico may
be an exceptional case, the high dependence of home towns is remarkable. For
Mexican “home towns” with a population of less than 3 000, HTA-donations
amount to 50 per cent of the local budget. On the one hand, this indicates a
structural weakness of the home towns’ financial position; on the other hand,
it shows how migration may simultaneously support individual migrants and
their societies of origin.
Already in the early 1990s, the Mexican state of Zacatecas tried to realize
this potential by establishing the “Dos por Uno” programme, whereby the local administration contributed a dollar for each dollar that the HTA remitted
to development projects. A few years later, the programme was extended to
other Mexican states and also made more generous, Tres por Uno, three for one
dollar. A similar programme has been instituted in El Salvador. As a follow-up,
and probably to pre-empt allegations of greediness, one of the main transfer
giants, Western Union, has volunteered to contribute with another dollar, thus
reaching “four to one” (up to a maximum of 1.25 million USD, Orozco & Rouse
2007).
Win-Win II: Mutual interests
When migration, and the remittances which go along with it, have become significant enough to the economy of origin, public support systems may be established to smooth and facilitate emigration and the life as immigrant, as this now
is seen to be in the interest of the country of origin. Thus, many Asian countries of origin have established diaspora institutions, and Bangladesh, China,
India, Indonesia, Korea, Pakistan, the Philippines, Sri Lanka and Thailand are
all examples of countries which have migrant welfare funds in order to protect
the interests of “their” emigrants and simultaneously secure the continuous flow
of remittances (Agunias & Newland 2012, World Bank 2008).
In several instances, the support begins by the establishment of recruitment
agencies in order to facilitate and speed up migration process. For instance,
in the Philippines, the government Overseas Workers Welfare Administration
(OWWA) provides – against a fee of 25 USD in 2007 – health and life insurance,
assistance for settling work related disputes (including failure by the employer
to pay agreed wages) plus training activities in preparation of departure. OWWA
also provides loans to emigrants and their families as well as grants for college
students and vocational training (World Bank 2008).
Diasporas may also be accorded special voting rights in order to keep them
32
connected to their country of origin, going from the possibility to vote from
abroad, to having an “extra-territorial citizenship” as emigrant. A survey of 198
countries found that there are three options which allow migrants to participate
in the democratic processes (to some extent): they can vote in their district of
origin, which requires them to return for voting; they may vote abroad and
their vote will be counted as if it was cast in the district of origin; or they may
vote abroad for their own special representation in the parliament. It is this last
scheme which most openly acknowledges the continuous existence of migration, and which thus recognizes the need to keep migrants connected in order to
secure the win-win-wins of migration over time. Countries where this is being
implemented include Algeria, Angola, Cape Verde, Croatia, France, GuineaBissau, Haiti, Mozambique, Morocco, Panama, and Portugal (Collyer 2014).
One reason behind this wish to keep the diaspora link – in addition to the
hope of seeing remittances flowing in – is the positive impact on FDI and hightech industrial development which have accompanied emigration, especially
high-skilled emigration. Two examples will have to suffice:
• First, there exists a positive relationship between the existence of a diaspora in the USA, and US FDIs to the countries of origin of the respective
diasporas: every percentage increase in the number of migrants tends to
increase the FDI stock in the respective country of origin by 0.2-0.4 per
cent (Kugler & Rapoport 2007, Javorcik et al. 2011).
• Secondly, learning from the rise and success of the Indian information technology industry in the 1990s, countries of origin may learn the
advantages of win-win-win policies: stimulating emigration, facilitating
return migration – dubbed “brain circulation” – and introducing public
policies to support the growth of a nascent information industry, all traits
witnessed in India (Docquier & Rapoport 2012:716-8).
But instead of stimulating migration, governments of countries of origin may be
tempted to try to appropriate for their country (or themselves) a greater share of
the remittances by taxing emigrants, or by levying duties and charges on money
and goods transferred (as contemplated in a World Bank presentation discussing the potential of remittances from the African diaspora, see Plaza 2007, thus
adding further to the World Bank dismal record – see above – of seeing migrants
as simple conduits of money transfers and disregarding their rights).
This basically negative stand concerning the potential of migration is also
evident from the attempt to “harness diasporas” (see Ratha & Plaza 2011) – a
revealing phrase – indicating that the World Bank and governments both worry
that migrant remittances may be channelled in directions outside of their control unless they are “harnessed”, that is brought under control by a supposedly
benevolent public power.
Win-Win III: Policy recommendations
The conflicting perspectives discussed in this report matter a great deal when it
comes to migration policies. Conclusions and recommendations will be fundamentally different depending on which side of the dichotomies you position
yourself regarding the Migration and Development Nexus: a curse/a blessing, a
drain/an opportunity, unidirectional/circular, permanent/temporary, optional/
33
unavoidable. For instance, if you hold that policy ought to be designed to limit
migration at both ends of the migration chain, your recommendations will be
profoundly at odds with what you would suggest if you believed that migration,
remittance delivery and migrants’ circulation should be facilitated (De Haas 2008).
See Table 5 for some policy measures proposed to enhance the positive impact
for the peoples and economies of the countries of origin.
The basic question that this report sets out to address is if migration may offer
a win-win-win proposition of mutually beneficial relationships, connecting and
linking migrants, their families, their countries of origin and destination in a
“migration regime” (Tamas & Palme 2006).
There exists an understandable apprehension among migration researchers
that the increasingly common take on migration as a win-win proposition in
fact obfuscates the neo-colonial and unjust exploitation of labour from poor
countries by rich countries, and by corporations based equally in the North and
the fast growing South (Wickramasekara 2011). The abuse of men and women
– going from sweat shops, assembly lines, and domestic work to trafficking and
prostitution – should remind us of colonial forms of taking advantage of and
exploiting human labour. Similarly, “circular migration” may be seen to be euphemism which hides the fact that migrants are denied permanent right of settlement, the “temporariness” of migration carries the stigma of previous regimes
of “Gastarbeiter”, Guest workers, where migrants essentially are seen as, and
dealt with as “pure” manual labour without social or cultural needs nor rights.
There are also good reasons to question the proposition that today’s migratory
flows constitute an historical exception. Contrary to the argument that migration soon will wane, as population growth declines and as industrialization
picks up in the South (Tamas & Palme 2006, Collier 2013), we are most likely
entering a phase where migration is a permanent feature of globalization. This
is so not only because the global divide in terms of welfare, freedom, security
and safety will likely remain wide for the foreseeable future There is also the
prospect of an increasing difficulty to find productive industrial employment in
the countries of origin caused by a process which has been dubbed “premature
deindustrialization”. Due to automation and robotization, industrial employment in the South has already peaked at lower levels of economic development
(measured by GDP) compared to the historical record in the North While industrial employment began to level off in early industrializers, such as Britain and
Sweden, at income levels of 14 000 USD (in 1990 USD), the peak now seems to
be reached in India, Africa and Latin America already at 700 USD (in 1990 USD;
Rodrik 2015:15).
34
Table 5. Improving the
potential of migration for development. An agenda for action at
various scales
Objective
Goal
Measures
Secure migrants’
human rights
Guarantee and protect civil
and political as well as economic, social, and cultural
rights at both ends of the
migration process.
Support trade unions, diaspora organisations and political parties and organisations
which target migrants in
countries and communities of
origin and destination.
Increase remittances
Subsidize migrants’ costs.
Promote short-term and
circular labour migration.
Minimize transfer costs.
Stimulate competition and
establish subsidised alternatives.
Transparency, trust.
Foreign exchange accounts
on favourable terms. Publicly
supervised migration channels.
Channel remittances to development purposes
Support Home Town Associations, donations.
Tax subsidies for donations to
charitable and development
organisations, match HTA
support with public support.
Stimulate investments
Facilitate the establishment
of small and medium sized
enterprises.
Secure availability of microcredits to match remittances.
Improve situation
of circular/temporary migrants
Facilitate migrants’ property
rights, protect migrants’
political rights in countries of
origin.
Benefit and social security
“portability” between jurisdictions, extend short-term temporary migration to enable
establishment, schooling,
multiple entry visas, preferential re-entry procedures,
simplified family reunification, voting rights.
Stability, long-term
consistency
Promote circular migration.
Bilateral labour migration
agreements.
Secure diaspora engagement.
Exchange programmes for
children between emigrant
and immigrant communities,
voting rights for migrants
in elections of countries and
communities of origin and
destination.
Adapted from Carling 2007, Wickramasekara 2011.
35
It is not far-fetched, then, to think that one effect of “premature deindustrialization” will be to further increase the pressure to migrate from the South.
If this is indeed the predominant tendency, a previously much disseminated idea
in the migration and development discussion – that today’s countries of origin
will become tomorrow’s destination economies – must be questioned. The idea
was based on the observation that some countries had performed a transition
from “sending” migrants abroad to “receiving” migrants from other, less successful economies, cases in point being North Africa and Turkey (Castles 2007:2678). Today the same trend is much discussed in connection with the migration to
the countries of the Arab Gulf and East Asia.
But what seems to be occurring at a global scale is rather that many countries
take on both roles simultaneously, as countries of origin and destination of migrants, as globalization advances and transport costs decline, witness especially
India and China. Thus, migration in all its guises and directions will remain an
essential component of the global economy, as ever more resources, goods, ideas
and people cross borders.
Therefore, the essential policy recommendation concerning Migration and
Development boils down to improving the conditions for migrants. Recognizing the fact that many migrants’ residence in the countries of destination is
permanent as well temporary and circular, that migrants straddle several social
and cultural networks, that their visions and allegiances extend across borders
and continents, and that migrants not only contribute to the development of
their countries of destination, but equally promote the social, economic and
political development of their societies of origin.
36
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39
250 million people are international migrants today, contributing to the development of their countries of destination as well as to the well-being of their families, societies and countries of origin. The view that migration constitutes a triple win – to the migrants themselves, to the countries of destination, and to the
societies of origin – although not entirely new has only recently come to permeate the Migration and Development discourse. But in spite of the fact that the
potential has been recognized, there still exist important weaknesses in today’s
global migration regime. In this report Forum Syd highlights three main areas
which need to be addressed in order to strengthen the benefits to be reaped from
migration: secure migrants’ social, economic and political rights, reduce the costs
of transferring remittances, and facilitating and supporting the work and services
provided by diasporas and home town associations.
The report is written by Kenneth Hermele, economist, Forum Syd, Sweden.
Forum Syd is a politically and religiously unaffiliated development aid organisation with around 160 member organisations from Swedish civil society. Together we
work with human and civil rights, and facilitate popular participation around the
globe. Our work centres on enabling people to organise to claim their rights and take
control of their lives; for it is only then that democracy can grow, resources can be
distributed more fairly, and poverty can be reduced.