MIG09
Evidence submitted to the House of Commons
International Development Committee - Migration and development
inquiry
Frank N. Pieke, Nicholas Van Hear and
Steven Vertovec
ESRC Centre on Migration, Policy and Society
(COMPAS)
University of Oxford
10 November 2003
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 per cent 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 per cent and additional
costs can make the total deduction over 20 per cent. 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, e.g. 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 activily 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,
i.e. 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;
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.
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