ROUNDTRIP: BANSALAN – HOLLAND: More than just tweaking

The King Baudoin Foundation has accepted the invitation to organise the first day of the Global Forum, which will be devoted to civil society. The 'Civil Society Forum on Migration and Development' on 9 July will gather a broad range of non-governmental actors to discuss the Migration and Development nexus and give input to the governmental discussions on the 10th and 11th of July.

The forum will bring together government representatives from migrant-receiving countries in Europe and countries of origin in Africa, Asia and Latin America, as well as international organizations, migrant organizations and other civil society organizations involved with migration and/or development. Of the estimated 550 applicants representing civil society, 200 participants were finally selected by the steering committee of the King Baudoin Foundation to attend the ‘Civil Society Forum on Migration and Development’.

A broad-range of topics related to migration and development nexus will be discussed but specifically on the following:

·       Highly skilled migration: balancing interests and responsibilities and tackling Brain Drain         

·       Temporary labour migration as a contribution to development: Low skilled migration and measures to combat irregular migration    

·       How can circular migration and sustainable return benefit development?

·       Measures to increase the development value of remittances: Formalization and reduction of transfer costs and ways to enhance the micro-impact of remittances on development to the benefit of the wider community

·       Strategies for building diaspora/migrant organisation capacity for development

·       The value of the "migration and development" nexus and migration out of choice vs. migration out of necessity

·       Enhancing policy coherence and strengthening coordination at global level (role of agencies and entities with a development, social, labour and human rights mandate)

·       Looking ahead: Developing strategies and partnerships to work on 'migration and development' issues

In order to ensure wide participation from the public, the King Baudoin Foundation launched a three-week online session and ran in English, French and Spanish. It was open to participation from non-state actors from around the world focusing on  Human Capital Development and Labor Mobility; Maximizing Opportunities and Minimizing Risks; Remittances and other Diaspora Resources; Increasing their Net Volume and Development Value; and Enhancing Institutional and Policy Coherence and Promoting Partnerships.

Aside from the online discussions, several regional and country-level consultations were also conducted and migrant remittances – money immigrants and foreign workers send abroad to their families – was among the themes which was extensively discussed.  Participants of the online discussions put forward policy recommendations to drastically reduce the cost of remittance transactions, the use of formal financial systems, harness the development potential of migration, and to allow microfinance, credit unions, and cooperatives to engage in remittance services.

The topic is quite relevant in the case of the Philippines as there are about 8 million Filipinos working abroad. According to the Central Bank of the Philippines, Overseas Filipino sent home an estimated US$ 14 billion last year, placing the country as no. 4 among remittances receiving countries.  The Philippines is the fifth-largest recipient of foreign remittances behind India, China, Mexico and France, and the highest when remittances are measured as ratios to population, GDP and exports. The remittances account for about 10% of the country's economy, making OFWs the government’s biggest source of precious dollars. Accredited delegates from the Philippines to attend the Civil Society Forum should be able to submit clear policy recommendations.

The Philippine government accounts the positive growth rate and the appreciation of the Philippine peso to the steady flow of remittances. However, while the government gloats over the strong peso, it is a big blow to the migrants because due to the strong peso the equivalent of the money they send home is much lower than before. The migrants are not the only ones complaining about the strong peso. A strong peso means lower peso conversion of exporters’ foreign exchange earnings. The appreciation of the Philippine peso against the dollar has also greatly affected the exporters. Recognizing the difficulties of migrants, Finance Secretary Margarito Teves says that overall, the strong currency helps the economy. However, the government is not acting on price adjustments on local commodities that will mitigate the negative impact on migrants. For instance, many schools all over the country increased their tuition fees before the opening the new school year. The peso rise according to Joachim von Amberg, outgoing World Bank director was due more to the dollar weakening than the peso becoming a stronger currency. Even the Ugandan shilling is appreciating against the dollar. The same is happening in other African countries. In this regard, the Philippines is not an exception and the increase of peso is not a direct result of the strengthening of the local economy.

The increasing remittance flows has made remittances an interesting subject of study of policy makers, development organisations and the academe.  Some policy makers and people in the academe are proposing policy measures on how to leverage remittances for development. One of these proposals is to remove tax privileges enjoyed by overseas Filipino workers whose remittances keep the Philippine economy afloat for several decades now. “Such a move can arrest the possible hollowing effects on industries and mitigate the loss in international competition," according to the study conducted by Tereso Tullao, Michael Angelo Cortez and Edward See.

In reaction to the recommendation, Michael Defensor, former administration candidate who lost in the senatorial bid credited the positive economic growth to the steadily growing remittances and described the proposal as "foolish" and "counter-productive". The unpopular tax proposal was vehemently rejected by OFWs and eventually watered down.

The correlation between housing boom and remittances and its multiplier effects on the local economy are also worth looking into. Century Properties, a Manila based real state developer estimates that 30 percent of all remittances end up in spending for the real estate sector, whether it is used to buy property or spent on housing improvement. Construction work needs workers thus, the housing boom propelled by remittance inflows contribute to job generation.  

The impact of remittances to micro and macro development of the country could not be simply ignored and to harness its development potentials need more than just tweaking. The growing dependence of the country’s economy on the money sent home by OFWs, the perpetuation of the culture and social costs of migration, and  violation of migrants’ rights are some  priority issues of concern which need immediate and careful attention.

The Civil Society Forum on Migration and Development must result into action-oriented policy recommendations related to remittances and their contribution to poverty alleviation and development.  Some basic principles must be considered such as:

1. Remittance is only one aspect of the migration and development field. Remittance tends to be singled out because it is seen as making the most direct contribution to development in migrants’ countries of origin. However, addressing other dimensions in the migration and development field can also help to boost the contribution of the remittances to effective development on the ground.

2. Migrants are the strategic agents behind the flow of remittances. Yet, migrants still remain invisible and are largely overlooked in the debates and policy considerations on the issue. This raises a concern particularly among migrants and needs to be addressed. After all, without migrants, there would be no remittances in the first place. Migrants feel that they and their tangible contribution to development and poverty reduction in their countries of origin are not appreciated. More importantly, there is a need to pay a greater attention to the well-being of the remittance givers who are mainly vulnerable workers, particularly women that perform dirty, dangerous and demeaning (3D) jobs in return for paltry wages.

3. There is a need to advocate linking migrant remittances to Poverty Reduction Strategy Papers (PRSP) and Millennium Development Goals (MDGs). Creating such a policy link would help mainstream the development potential of remittance in a wider development agenda. Furthermore, this process will enable migration and development issues to become an integral part of the recipient countries’ strategic national economic and development plans.

4. Addressing the socio-economic inequalities generated by remittances in the receiving localities should be considered. How this can be redressed is an aspect, which needs to be discussed. It is also important to hear the views of migrants on how remittances can be invested in productive ventures that generate a means of living for those who are not direct beneficiaries of remittances.

5. Consideration should be made of the strategic policy recommendations of the Civil Society Forum in the future dynamics of remittances. This raises the question: what can we learn from past experiences, best practices and positive exceptions to future policy interventions. This knowledge is essential for the formulation of policy positions and strategies, better policy responses, practical operations, and, in the end, improving the quality of life of the poor recipients in the developing countries.

To maximise the benefits of remittances, it is recommended among others to 1) reduce the high cost of remittance transfer, 2) promote financial literacy/financial democracy, and 3) link remittance with microfinance. Likewise, Filipino migrant organisations should try partnering with international organisations, the private sector and governments to increase the worth value of their development projects, and forge strategic trade alliances with other stakeholders. Most of the success stories about remittances are individual, not collective. This proves that despite the huge amount of remittance inflows, governments and development agencies have not yet really found the appropriate strategy to unleash the full development potential of remittances and taking diasporas as active partners in development.

For instance, the Philippine government and the new members of the 14th Congress can look into the possibility of replicating the 3 for 1 program in Mexico. Under this program, the local, state and federal governments of Mexico will match one dollar each for every dollar invested by Mexican diaspora organisations on any productive and social projects in their hometown. The 3 x 1 scheme has been institutionalized meaning it remains enforced, respected and implemented regardless of who holds the power in the government. Moreover, the program respects ownership since the Mexican diaspora organisations participate actively in the identification, implementation, and monitoring of the projects. In the Philippines, the government just taps migrants as mere donors who have no right to say on the projects.

However, capturing a share of remittances for development requires transparent and coherent policies, the relevant enabling environment, and full recognition and appreciation of the positive contributions of migrants to the development of their countries of origin. It cannot be fully achieved without consideration of other migrant-related issues such as the human rights of migrants including women and the social costs of migration. There is a need therefore for the Philippine government and the civil society to collaborate to harness the development potentials of international migration.  The representatives of the Philippine government and the civil society attending the Civil Society Forum on Migration and Development must seize the opportunity in coming up with a revolutionary coherent migration and development policy instead of merely tweaking. (Mindanawon Abroad is MindaNews' effort to link up with Mindanawons overseas who would like to share their experiences in their adopted countries, the countries they're presently working in, their growing up years or homecomings in Mindanao, their hopes and dreams and suggestions for Our Mindanao. Leila (Lalay) Rispens-Noel, a native of Bansalan, Davao del Sur, left for the Netherlands in 1979. She was former staff member of Mindanao-Sulu Secretariat for Social Action. Aside from being a wife a mother of two grown up sons, she works as programme officer in a Dutch development agency. Visit her blog: http://diasporajurney.blogspot.com or you can contact her at [email protected])

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