Memorandum submitted by the ESRC Centre
on Migration, Policy and Society (COMPAS), University of Oxford
1. GENERAL
The British Economic and Social Research Council
(ESRC) has recently awarded the University of Oxford a grant for
a new national research centre on migration. With renewable core-funding
for an initial five-year period, the mission of the Centre on
Migration, Policy and Society (COMPAS) is to provide a strategic,
integrated approach to understanding contemporary and future migration
dynamics across sending areas and receiving contexts in the UK
and EU. COMPAS staff who are the authors of this document have
long-term research experience in the field of international migration.
Frank Pieke's main field of expertise is Chinese migration
and the impact of diasporic links on sending areas. Nicholas
Van Hear is an expert on conflict, migration and development,
in particular in Africa, the Middle East and South Asia. Steven
Vertovec has worked extensively on transnationalism, including
the issue of remittances and their impact of sending areas.
Any assessment of the impact of migration on
development has to start with the observation that international
migration is a normal and unavoidable aspect of the globalisation
of capital, cultural products and other goods, information and
people. Globalisation involves much more than flows from the poorer
peripheral areas of the world system to the richer central areas.
Flows between peripheries are at least as important. However,
if left completely to the forces of the market, the impact of
globalisation is nevertheless likely to privilege the stronger
and more developed parts of the global system. The question therefore
is not so much if development policies should incorporate
the effects of migration, but rather how such policies
should maximise the benefits that migration can bring for the
often poor and vulnerable populations in the sending areas, while
minimising its potentially less positive aspects.
For many years, the migration of skilled workers
from developing countries was regarded solely as a problem of
"brain drain." With the recognition of networks of skilled
worker circulation, many social scientists and national policymakers
have tended to shift from a discourse of "brain drain"
to notions of the globalisation of human capital, brain exchange,
brain circulation and the creation of a global mobile workforce.
The idea is to accept the fact that skilled persons may want to
migrate for personal, familial and career development, while seeking
to encourage the skilled migrant's return, mobilisation or association
with home country development. Indeed, it is transnational networks
of professionals that are deemed crucial to realise such goals.
Until recently, migration and development have
constituted separate policy fields, marked by different and sometimes
contradictory approaches. For the authorities that deal with migration
in the UK, the control of flows has become the priority, while
development agencies have concerns that the objectives of development
policy may be jeopardised if migration control is accorded primacy.
Can long term goals of poverty reduction be achieved if short
term migration policy interests are to be met? Can partnership
with developing countries be genuine if preventing further migration
is the principal migration policy goal? While there may be good
reasons to keep some policies separate, conflicting policies are
costly and counter-productive, particularly if these conflicts
are not debated and where possible resolved because of the lack
of mechanism that brings together the separate government departments
with a stake in migration.
In this document we will discuss these policy
considerations in the context of research conducted in our specific
areas of expertise: remittances, diasporic links, and forced migration
and asylum. In the concluding section and recommendations we will
return to the general issue of the connection between migration,
development and policy making.
2. REMITTANCES:
FLOWS, USES
AND IMPACTS
Migrants influence the development of their
home countries by the resources and assets they send or bring
back with them. However, these resources are not evenly distributed,
and there is a tension between the remittances that migrants and
refugees send, and the benefits of the return or repatriation
of migrants and refugees.
Remittances are an important resource for many
households in developing countries. Because they move directly
from person to person, they may have a more direct impact than
other resource flows. But the benefits of remittances are selective.
Though not exclusively, they tend to go to the better-off households
within the better-off communities in the better-off countries
of the developing world, since these households, communities and
countries tend to be the source of migrants.
In societies in conflict or emerging from conflict,
remittances from abroad help households to survive and to sustain
communities in crisis—both in countries of origin and in
neighbouring countries of first asylum. After conflict, remittances
are potentially a powerful resource for rehabilitation and reconstruction.
But again there is selectivity: these transfers reach relatively
few households. At the same time, remittances and other transfers,
as well as international lobbying by diasporas, may actually help
to perpetuate conflict.
The sheer scale of contemporary global remittances
itself represents a significant contemporary form of social and
economic transformation. Figures from the International Monetary
Fund (IMF) show a massive increase in the amount of formal remittances
world-wide, from less that $2 billion in 1970 to at least $105
billion in 1999. Over 60% of this amount goes to developing countries,
and over the last decade remittances have become a much larger
source of income for developing countries than official development
assistance.
Remittances have broad effects, including the
stimulation of change within a variety of socio-cultural institutions
(such as local status hierarchies, gender relations, marriage
patterns and consumer habits). However, it is the economic impacts
of remittances that receive most attention. More research on social
and cultural impacts would greatly improve our understanding of
the nature and trajectory of remittance flows, as well as provide
for more effective policy decisions and instruments.
In numerous settings around the world, remittances
have been shown to be directly invested in small businesses such
as manufacturing and crafts companies, market halls, bakeries
and transport agencies. However, various studies show differing
proportions of remittances spent on consumer goods versus "productive"
investments. Among the reported negative impacts of migrant remittances
are the following. Remittances are said to: displace local jobs
and incomes; induce consumption spending (often on foreign imports);
inflate local prices of land, housing, and food; create disparity,
envy between recipients and non-recipients; and create a culture
of economic dependency.
It must be stressed that a large proportion
of migrants send money to families for mere subsistence. Also,
schooling and other costs of education are often not factored
into studies on the "productive" use of remittances.
It has been argued that many forms of consumption, particularly
on housing, better food, education, and health care, are a good
form of investment that will lead to higher productivity and positive
economic development at local and national levels.
Most experts on remittances argue that recipients
are not getting their full worth. Most formal financial transfer
institutions charge a fee from 6 to 15% and additional costs can
make the total deduction over 20%. It is widely believed that
the worth of remittances would be much higher if the cost of transferring
money was lower. There are currently a number of moves among governments
(such as the USA's Wire Transfer Fairness and Disclosure Act of
1999), among NGOs and in financial institutions themselves to
create more transparency in pricing and greater consumer awareness.
In many places one of the most common and extensive
uses of remittance money is toward health care expenses. Some
NGOs are developing schemes to creatively use remittances to provide
regular transnational health care coverage. A different kind of
multiplier or "protective effect" concerns the general
development of health profiles among remittance-receiving families.
Remittances offset the effects of poverty by raising standards
of living, improving nutrition and facilitating access to medical
care.
Micro-finance Institutions (MFIs) have the potential
to meet a massive global demand for local banking services that
many governments and donor agencies increasingly recognise as
a priority. A core function of MFIs is to provide small, low-interest
loans (microcredit, eg from $10 to $3,000) and savings services
to poor families—and often specifically to women—who
ordinarily do not have access to formal financial institutions.
Such loans are to help people engage in productive activities
(involving, for instance, small farms, petty trading, craft enterprises
or local business). MFIs offer credit, savings and insurance in
often remote rural areas. They also may give financial and business
advice and training. Many MFIs are non-profit NGOs, credit unions
or co-operatives while there are also new commercial MFIs. Currently
augmented by new information technologies, MFIs are growing in
number, extent and function throughout the developing world.
3. TAPPING THE
DIASPORA FOR
DEVELOPMENT
Beyond seeing migrants as a source of resources
for development and reconstruction, steps could be taken to give
diasporas a more active voice. These could include involving diasporas
in international forums to co-ordinate resource flows from donors
and from diasporas for development and reconstruction. In addition,
diasporas could be allowed greater influence in peace-building
and reconciliation efforts. Since non-governmental organisations
have become increasingly involved both in advocacy and in the
delivery of aid, and often have direct lines of communication
with diasporic groups, they are well placed to act as interlocutors
promoting diaspora participation. One problematic issue in such
diaspora involvement is that of representativeness, given the
conflicts and tensions that often feature within diasporas.
There is a considerable range of diasporic organisations
involved in development in regions such as China, Africa and Latin
America. These include Home Town Associations (HTAs), ethnic associations,
alumni associations, religious associations, professional associations,
investment groups, political groups and supplementary schools.
Their activities include community-to-community transfers, identity-building,
lobbying in current home on issues relation to homeland, trade
and investment with homeland, and payment of taxes in the homeland.
These kinds of transnational migrant institutions and activities
are increasingly found around the world among migrant communities
from highly diverse origins in developing countries. Their structures,
strategies and influences on local and national development are
only minimally understood.
There have emerged a number of schemes and types
of transnational networks of expatriate professionals that can
be tapped to enable their effective and productive role in a home
country's development—even without any physical temporary
or permanent return. Although such links have existed in one form
or another in the past, they are now becoming systematic, dense
and multiple. The Chinese government, particularly at the local
level, has built up an extensive framework of policies and institutions
to mobilise diapora Chinese for investment and donations in China,
both in their home communities and elsewhere. As a result, overseas
Chinese (including Hong Kong and Taiwan) account for the bulk
of foreign direct investment in China, and other sending countries
such as India now actively seek to emulate the success of China.
The United Nations Development Programme supports major initiative
in this field called TOKTEN (Transfer of Knowledge Through Expatriate
Nationals; see www.unops.org). Country-specific TOKTEN programmes
involve databases of people and assisted visits of skilled expatriates
to engage in various development projects.
The movement of students should be seen as an
integral part of transnational migration systems, not least because
the networks they forge often lay the tracks of future skilled
labour circulation (among governments there is growing awareness
of this, seen in the increasing incidence of national programmes
for student recruitment with a specific view towards longer-term
or permanent settlement). This is an area of massive expansion
around the world with multiple social, cultural and economic repercussions
for both student-sending and student-receiving countries; there
is little good research and analysis on this sector.
Several migrant-sending states have sought to
establish economic schemes, such as special investment funds or
savings accounts, to channel remittances and encourage business
development. These have met with very mixed results. The Multilateral
Investment Fund of the Inter-American Development Bank promotes
and funds initiatives that will allow emigrants to invest their
money in development projects in places of origin. In 2001 the
Fund extended a grant of $1.1 million to support projects in Mexico
facilitating the linkage of remittance transfers, local financial
services and productive investments by migrants and their families.
This might be seen as a model that could be emulated in other
regions.
The Mexican government's "three for one"
programme can be seen in many respects as a positive model of
state collaboration surrounding migration, remittances and development.
Through this system, each dollar remitted from abroad through
a Home Town Association (HTA) is matched with one dollar from
the federal government, one from the state government and one
from the municipal government. Between 1999-2001, migrants invested
$2.7 million into such programmes. Despite some limitations, these
initiatives in Mexico have produced a deep impact in the local
communities and have been recognised as new and effective forms
of public-private collaboration.
HTAs are not the only players in these kinds
of schemes. Financial services firms such as Raza Express have
joined in, contributing $0.75 to the collective funds for each
$300 sent through their company. In this way Raza Express has
contributed more than $50,000, alongside $500,000 from the government
of Jalisco, in schemes creating 15,000 jobs.
HTA activities embrace charitable work such
as donating clothes, goods for religious festivals and construction
materials for repairing the town church in the place of migrant
origin. They raise money for improving local infrastructure such
as sewage treatment plants and health care facilities. They support
educational institutions, such as providing scholarships and library
books. Yet another kind of HTA activity involves managing collective
capital investment for income-generating projects in sending contexts
that are often co-managed by locals and migrants. HTAs also play
a significant role in organising disaster relief following catastrophes
such as Hurricane Mitch in Central America in 1998 and the earthquakes
in Turkey in 1999 and in Gujarat in 2001.
In proportion to total remittances sent through
families, collective remittances channelled through HTAs and other
migrant transnational frameworks are small although likely to
increase. Despite this fact, and that of the sometimes problematic
nature of such organisations and their relationship to the state,
the forms of institutionalisation they represent have much valuable
potential for effectively directing remittances to highly needed
and effective forms of local development.
4. FORCED MIGRATION
AND DEVELOPMENT
Like "voluntary" migration, forced
migration has important implications for development. Refugee
flight involves the loss of labour, skilled workers and capital
for the country of origin. But it also opens the possibility of
remittances from refugees who manage to find employment. However,
refugees hosted in developing countries usually have less in the
way of earning potential and therefore less remittance power than
those in more prosperous asylum countries.
Remittances and their impact may be more diffuse
than is the case with conventional economic migration, since refugees
in western countries, for example, may send money to refugee kin
in first asylum neighbouring countries as well as to kin in the
homeland.
Mass arrivals of refugees—usually in countries
neighbouring those from which refugees have fled—may have
short term damaging effects, particularly in terms of strains
on the resources hosts must provide. However, in the longer term
the impacts of such mass arrivals may be more beneficial, particularly
in terms of the economic, human and social capital newcomers bring
with them.
While much attention has been paid to refugee
outflows and to refugee repatriation, countries that have hosted
refugees, particularly for protracted periods, have often been
neglected. Conditions for refugees in such countries have tended
to be poor, encouraging instability and movement further afield.
Neglect has continued after refugees have repatriated: little
attention is paid to the countries and communities that have hosted
refugees after they return home. Yet these countries and communities
are often poor, unstable, or vulnerable to instability from the
spill-over effects of conflict in their neighbours' territory.
With some justification, and pointing to the neglect of the principle
of responsibility-sharing, some developing countries hosting refugees
have responded by becoming less willing to accommodate new inflows.
Directing aid to such countries would recognise the contribution
such refugee-hosting countries make, and encourage them to maintain
a liberal policy towards receiving refugees.
5. RELATIONSHIP
BETWEEN MIGRATION
AND DEVELOPMENT
There is no unequivocal one-to-one relationship
between migration and development. Research has demonstrated that
economic development initially may very well stimulate migration
as the local population parlays some of their new wealth into
migration, before reducing the level of migration again with the
gradual disappearance of the income gap between sending and receiving
countries. Similarly, some types or flows of migration have a
positive development impact, others a negative or neutral one.
For instance, migration of skilled workers may be detrimental
to development in some countries, while being part of developmental
policies in other countries that train the very same skilled workers
specifically for export (for instance the contrast between the
migration of Zimbabwean and Filipino nurses). However, assessing
the impact of migration also depends on our priorities. If relief
of immediate hardship or raising the standard of living of migrants
and/or their direct dependants in the areas of origin is our first
objective, potentially many more or other forms of migration are
positive than when we are seeking to encourage a broader pattern
of sustainable development in the areas of out-migration.
The relationship between migration and development
also includes the important issue of the formation of cultures
of migration that make sending areas permanently dependent on
the continuation of out-migration. The latter is often considered
a negative development, but how justified are we in wishing to
impose a policy agenda that prioritises local development over
international migration as the preferred venue for increasing
one's well-being?
Whatever our priorities, key factors determining
the impact of migration on development in a particular area are
likely to be:
— The role, effectiveness and policy
objectives of the local and national governments in the sending
area.
— The reasons and motivation for migration:
is it poverty driven, opportunity driven, or driven by natural
or man-made calamities?
— The socio-economic background of
migrants, ie the issue of the selectivity of migration.
— The extent to which migrants can
and wish to retain their link with the sending areas, which includes
the issues of remittances and their use, return investment, return
visits and return migration.
In order to realise its potential, international
migration should be considered in a broader policy framework than
just its impact on the UK, where migration is largely phrased
in negative terms: the issues of asylum, illegal migration and
the purported burden on the welfare system and labour market.
Migration ought to be viewed as constituting important opportunities:
for individual migrants themselves, for the UK economy, for relieving
the disruption and suffering caused by political upheaval and
natural disasters, and for leveraging the impact of developmental
policies in the sending areas.
Migration policies should facilitate the mobility
of people in conjunction with the mobility of goods, capital and
information. Governments should move away from viewing migration
as a one-off and one-direction process that removes people from
one place and permanently inserts and ultimately integrates them
in another. Policy should enable the permanent mobility of people,
which importantly also includes temporary or permanent migration
back to the country or area of origin.
6. RECOMMENDATIONS
— There is no simple one-to-one relationship
between migration and development. One-size-fits-all policies
that try to maximise the developmental impact of migration regardless
of context are bound to fail. However, it should be recognised
that migration—importantly also through concomitant remittances—will
continue to represent a major source of development potential
for many migrant-sending countries and localities. With further
analysis of, and support for, remittance transfer and investment
mechanisms—perhaps combined with managed migration schemes
especially for temporary, low-skilled workers—the long-term
development of a substantial number of countries might be enhanced
greatly.
Concrete measures to increase the level and developmental
impact of remittances could be:
1. Government support for efforts to reduce
the transaction charges among remittance agencies.
2. Government support for projects enabling
"transnational health care coverage" through remittance
investment.
— Conversely, aid policies should take
greater account of the impact of migrants' remittances, so as
to foster complementary roles for the two kinds of flow to developing
countries. Remittances are great potential resources for development
and reconstruction, but the distribution and benefits of remittances
are skewed. The provision of aid needs to take account of such
uneven distribution, with particular focus on poor countries and
communities that do not benefit from remittances, and should take
into account the developmental value of "non-productive"
remittance spending (especially nutrition, health care and education).
Regarding forced migration, aid should be allocated on the basis
of need in neighbouring countries hosting refugees, not with the
purpose of containing international flows of migrants and refugees.
Policies that aim to contain refugees in countries or regions
of origin will likely be counter-productive because they tend
to weaken and destabilize refugee-hosting states, and may lead
to further refugee outflows within the region and beyond—contradicting
the very objectives of such containment policies, as well as hindering
development in such countries.
Concrete measures could be:
1. More research into the potential frameworks,
forms and benefits of Micro-finance Institutions (MFIs), such
as credit unions, as a mode of channelling remittances and broadening
their positive impacts.
2. Government support for schemes such at
the UNDP's TOKTEN, as well as further research into the actual
uptake and impacts of such schemes.
3. Government support for, and collaboration
with, initiatives of international development agencies for channelling
and matching funds in relation to collective remittances.
4. Government support for migrant Home Town
Associations (HTAs) as significant players in the economic development
of sending localities.
— Migration policy has actively to
prioritise the interests of the poor and the poor areas of origin
of international migration over the interests of the richer developed
areas of destination. In order to argue effectively for this the
objectives of UK development policy in relation to migration need
to be stated clearly. Furthermore, an inter-departmental governance
mechanism is needed that will in future ensure that DfID's objectives
and experience adequately inform migration policies of other departments,
such as those of the Department of Health on recruitment of skilled
health professionals, those of the Home Office in relation to
return of asylum seekers to post-conflict societies, and those
of the Department for Education and Skills in relation to overseas
students. The experience of the EU High Level Working Group on
Migration and Asylum holds some important lessons, not least that
UK and EU partnerships with developing, migrant-sending countries
need to be more soundly and equally based, and not grounded solely
in migration containment priorities as they have tended to be
hitherto.
— Management of international migration
requires bilateral and multilateral co-operation between nations,
in which international organisations and the organisations of
migrants themselves play an important role. This could be done
by establishing multilateral partnerships between sending and
receiving countries, but also partnerships between regional blocs
of sending countries may give the development impact of migration
a greater say in the international discussion on migration.
— The role of local government in sending
areas is a crucial factor in determining the nature and impact
of migration. Local governments that take an active interest in
the orderly flow of migration have much greater scope in harnessing
migration for further developmental goals. The UK and its partners
should therefore actively seek to establish partnerships with
such local governments. However, it should be borne in mind that
policy agendas of national and local government may conflict,
and furthermore that the priorities and reach of local governments
vary greatly, even within one country, and careful consideration
should be given to what is can and should be achieved in each
case.
— Regulating and increasing the channels
of migration for both skilled and unskilled migrants that also
enables migrants to achieve their objective of free mobility between
several countries, including the UK and their country of origin,
rather than simply obtaining permanent residence in the UK. This
will both help to stop the abuse and excessive costs of illegal
migration, and will give governments of sending and receiving
areas a greater impact on the migratory flows. Policy aimed at
simply restricting migration will only exacerbate the problems
of illegal migration and the abuse of the asylum system, student
migration visas and family reunion. National government and international
agencies cannot stop the international flows of people, but can
only have a limited regulating role: we should not overestimate
the impact that migration management can have: "migration
management" is no magic wand.
Concrete measures could include
1. maintaining flexible asylum and resettlement
policies that relieve pressure on poor first asylum countries
hosting refugees;
2. allocating temporary work permits to workers
from poor countries both to meet labour shortages in developed
countries and to enhance remittances to their homelands;
3. ensuring sensitive recruitment of highly
skilled workers to avoid depleting developing countries of human
capital; and
4. introducing flexible citizenship or residence
rights to allow migrants to return to home countries without prejudicing
their right to stay in host countries.
— Return of migrants and refugees
should not always be the over-riding policy goal. Returnees can
be a substantial force for development and reconstruction of the
home country, not least in terms of the financial, human and social
capital migrants and refugees may bring home with them. However,
there is the dilemma that return of migrants may reduce the flow
of remittances to the home country. Furthermore, if the resolution
of conflict or crisis is accompanied by large scale repatriation,
the society and economy may not be able to cope with the sudden
influx of returnees, raising the potential for further instability,
conflict and, ultimately, renewed out-migration.
November 2003
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