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Development Aid and Forced Migration

Theme: Governance and the Promotion of Rights in the International Cooperation and Aid
Reality of Aid meeting
June 22 to 24, 2003, Philippines
Prepared by: Ramon Bultron, Managing Director
Asia Pacific Mission for Migrants (APMM)

Almost five years ago, international government agencies recommended the effective use of the Overseas Development Aid as an alternative solution to the growing problem of forced migration.

In a joint study by the International Organization for Migration (IOM) and the United Nations Conference on Trade and Development (UNCTAD) in 1996 entitled "Foreign Direct Investment, Trade, Aid and Migration", the two international bodies reviewed the trends in international economic migration and found that push factors of emigration have intensified since the 1980s in both developing countries and the former socialist countries. The IOM and the UNCTAD said that economic migration is rooted in extreme poverty and differences in living standards between countries.

Extreme poverty was associated with the continuing farmer’s issue of landlessness and lack of sufficient local industries to boost up the economy.

The study of IOM/UNCTAD mentioned that the better way to manage economic migration was to generate rapid economic growth in the countries of origin. Broad-based and rapid development would induce migrants to stay at home of their own free choice rather than migrate under compulsion. The UNCTAD/IOM study said that increased flows of FDI and trade, as well as more effective use of development aid, impact directly and indirectly on this process.

Since then, the effectiveness of ODA in addressing the root causes of forced migration remained as a question.

The Current Nature of Development Aid

Almost all of the current development aids are conditional aids. They are given not without conditionality of its use or the implementation of national policies in exchange of the said aids. These conditions however, in more than few instances, are not compatible with policies that aim to develop the basic economic strength of developing countries.

Instead, the type of development that the conditions gear for is a development that binds the economy of more backward countries to those of the highly-developed ones. The aids are used to maintain the present setup where the more backward countries are the supplier of cheap materials and labour for the industries of the more developed ones. The poorer countries are also the ready market for the goods of the developed economies.

This does not come as a surprise if one considers the main source of aids. The aids that governments give to international financial institutions mainly come from big multinational and transnational corporations. Thus the aids to the more backward economies come with conditions in order for the corporation to sustain the steady supply of provisions for what they need. The national policies, on the other hand, are formulated to create an atmosphere that is good for businesses – that is, where they can get the maximum of profits.

There is now an initial trend wherein aids are focused on war. International aids are used to further advance the United States led campaign for a “borderless war against terror.”

In her latest visit to the United States, Philippine President Gloria Macapagal-Arroyo has brought with her a US assistance package that is mainly on developing the military capacity of the country and strengthening the military ties between he US and the Philippines. An astounding US$126M of military aid highlights the assistance that the US government has given. Additionally, the US has promised the Philippines provisions for military equipment, fighter jets and Huey helicopters, cargo planes, and thousands of US troops.

The measly amount given for the development of Mindanao is also directed towards building infrastructures that will help the US and Philippine troops in its campaign to subvert various armed groups in the South.

President Arroyo herself has said that terrorism is rooted in poverty. As what groups who are against the ongoing all-war in Mindanao have said, if the problem is poverty, how can pouring out of material and financial resources for military purposes solve the downtrodden situation of the people in Mindanao.

This kind of aid will only intensify forced migration in the developing countries. Economic displacement borne by political strife will surely increase. The case of the thousands Filipinos who have been deported as undocumented workers from Sabah illustrates how the political instability in the southern Philippines has resulted to even greater forced migration.

Governance, Development Aid and Forced Migration

Recently, the World Bank has given approval to the Philippine government’s handling of development aids.

But then again, how can we really gauge the effectiveness of aids? Is a stamp of approval from an international financial institution enough to judge whether the given development aids are indeed helping the recipient countries?

Measuring the effectiveness of governance of development aids ultimately leads to the question of whether these aids and its benefits seep down to the grassroots.

It has already been established that poverty is the main push factor of forced migration. It is thus reasonable to say that the migration trends and its place in a nation’s economy can be used as a ‘measuring stick’ on the impact of development aids to labour exporting countries who have been the steady receivers of these aids.

One aspect that we can look into is the increased migration of people from labour exporting countries that is directly related to economic displacement. Secondly, we can compare the place of the remittances of migrant workers vis-à-vis the overseas development aids that developing countries receive. Finally, we can look into the current social and political movement of migrant workers in order to see their concerns in relation to development aids.

1. Intensifying labour export of developing countries

In the Philippines, the Labor Export Policy or LEP systematizes and intensifies the exportation of human labor. During the time of President Marcos, LEP was called a “stop-gap” measure. It became an important component of the so-called "development program" under Aquino.

Former President Ramos further imprinted and developed LEP through the “international sharing of human resources”. It was also systematically and vigorously continued by Estrada and was passed on to President Gloria Macapagal Arroyo. As a showcase of its place in the national economy, President Arroyo passed Presidential Decree No. 76 declaring the Year 2002 as the “Year of the Overseas Employment Providers” last year.

The Philippines continuously topped the list of major exporter of human labor in Asia alone from period 1996 to 2000. It is then followed by Thailand (763,258), Indonesia (723,139), Sri Lanka (651,635) and Nepal (227,742).

Table 1. Total Number of Migrants Deployed for the Past 5 Years in Selected Countries

Sources: Scalabrini Migration Center; POEA

Table 2. Deployed Overseas Filipino Workers (in Asia, Oceania, Middle East, Americas, Trust Territories & Africa)

Indicator 01 Jan – 17 Apr 2002 2001 2000 1999 1998
Land-Based 219,132 181,484 181,060 640,331 638,343
Sea-Based 61,750 49,974 49,250 196,689 193,300
TOTAL 280,882 231,458 230,310 837,020 831,643
Source: DOLE / POEA; DOLE’s 20 April 2002 press release

In April 20, 2002 the Department of Labor and Employment (DOLE) said that “Since the start of the year an average of 2,748 Filipino workers (OFWs) leave for overseas posts daily”.

According to Acting DOLE Secretary Arturo D. Brion, “Filipino workers leaving daily from January to April 17, 2002 surpassed the average 2,551 departures registered in the same period in the previous year”.

Table 3. Compares the daily average deployment between 01 January – 17 April 2002 from last year’s same period

Indicator Average Daily DeploymentAs of 17 April 2002 Average Daily DeploymentOn same period of 2001
Land-based 2,045 1,996
Percentage of “re-hired” and “newly-hired” of the 219,132 land-basedFilipinos deployed as of 17 April 2002 (see Table 2). Re-hired: 67% or 146,367
Newly-hired: 33% or 72,765
Sea-based 703 554
Total 2,748 2551 (2550)*
Source: POEA Administrator Rosalinda D. Baldoz (DOLE 20 Apr 2002 press release)

Indonesia, another labour exporter has also seen an increase of migration. The latest of the series of national development programmes saw 1.5 millions Indonesians migrating abroad to seek work.

Labour export remains unabated and in fact has increased. The abovementioned illustrations only mean one thing. That export of labor will remain as a policy strategy among third world countries for the development aids are not being used to increase employment opportunities, raise the standard of living of the populace, and protect the livelihood of the people.

2. Remittances Surpass Overseas Development Aids

The export of human labor is a major source of dollar earnings among third world countries. It also provides a condition to temporarily cushion the growing protest of people against their own government due to deepening poverty and growing unemployment in the country.

A World Bank study found that financial flows associated with international migration amounted to nearly US$71.1 billion in 1990, second only to trade in crude oil and larger than the total world development assistance commitment.

This is the reason why in several nations of the Asian region (e.g. Pakistan, India, Sri Lanka, Bangladesh, Philippines), remittances are either the most important or among the first five sources of scarce foreign earnings. In these countries, export of people has displaced export of commodities as major source of balancing their payments for imports.

Manolo Abela of the ILO wrote in 1991 that if migration were to cease (in Bangladesh, Pakistan, Philippines, Sri Lanka and Thailand) it would require US$55 billion in capital inflows to maintain the same level of income as before.

According to Philippine Overseas Employment Administration (POEA), about US$ 2.17 billion was generated by the government on remittances of migrant workers from 1982-1985 alone. Under Aquino, US$5.98 billion were remitted through legal banking channels from 1986-1991. Under Ramos, a total of US$16.68 billion was generated from remittances of migrant workers in a period of 4 years (1992-1995).

In 1993 alone, total remittances reached US$2.23 billion while total revenues generated by overseas workers (i.e. taxes, fees, remittances) was estimated by Central Bank to be US$4.5 billion. ILO estimates, however, gave a US$ 7-billion figure.

For the year 2000, total remittances recorded by the Bangko Sentral ng Pilipinas was US$6.05 billion.

Meanwhile, in the receiving countries like Saudi Arabia, total outflow of workers remittances between 1990-1995 was about US$100.3 billion averaging about US$16.7 billion annually. Among the major destination of remittances were the Philippines, Egypt, Bangladesh, India, Pakistan, Sri Lanka and Jordan.

In some countries such as India, Morocco, Pakistan, Tunisia, Turkey and Yemen, annual remittances outweigh official development assistance (ODA) by a third or more, according to a Human Development Report of the U.N. Development Programme (UNDP).

On an average, Turkey has been receiving about US$3 billion dollars annually in workers remittances compared with US$1.5 billion in ODA. In India the figures are about US$2.5 billion and US$1.8 billion respectively.

In Bangladesh, remittances in 1997 and 1998 were recorded at 1,525.03 and 1,599.24 billion US dollars respectively. In Indonesia, about three million Indonesian migrant workers remitted US$1 billion in 1998.

In Sri Lanka, remittances in 1999 increased to Rs74 billion up from Rs64 billion of the year before. The first nine months of 2000 registered an increase of 14 percent.

In Thailand, meanwhile, remittances in 1999 were recorded at 56 billion bath.

For the year 2002, total remittances recorded by the Bangko Sentral ng Pilipinas is US$7.2 billion. The January to March 2003 data from the same source, recorded total remittances of US$1.7B compared with US$1.6B recorded on the same period in 2002.

Table 4. Top Ten LDC’s Receiving Remittances 1995-2000

Total remit US$bn Remittances per US$ aid Remittances/GDP,pct
1. India 45.9 Turkey 39.3 Lesotho 37
2. Philippines 29.1 Mexico 33.9 Jordan 21
3. Mexico 28.0 Costa Rica 23.9 Samoa 21
4. Turkey 21.0 Jamaica 15.4 Yemen 18
5. Egypt 16.6 Barbados 14.7 CapeVerde 18
6. Morocco 10.0 Dominican Rep 9.8 Albania 16
7. Brazil 9.3 Croatia 9.3 Jamaica 13
8. Thailand 8.0 Philippines 7.8 El Salvador 11
9. Pakistan 7.8 Antigua Barboda 6.9 Georgia 10
10. Jordan 7.7 Nigeria 6.8 Antigua Barboda 9
Source: IMF and World Bank

These data indicate that the economies of labour exporting countries are still largely dependent on remittances of migrant workers. While development aids add to the national income of a country, earnings of migrant workers remain as the major economic factor that is used to balance the import and export payments in order for these countries to drastically go down the drain.

The role of remittances is directly related to the intensifying labour export. While development aids are not used to create the condition for forced migration to thrive, laboutr exporting countries will continue to depend on remittances to prop up their ailing economies.

3. Wages, economic security and livelihood: The Continuing Struggle for the Rights of Migrants

Migrant workers in the world are getting restless.

In host countries, organizations of migrants have faced issues that mainly focused on their wages, security of employment, and livelihood. Host governments everywhere have been instituting mechanisms that depress the economic situation of the migrant workers.

In the face of this condition, organizing of migrant workers has gained ground. These organizations are leading the campaigns against attacks to the rights of migrants.

The interest of migrant workers to defend their rights in their host countries is very much related to the prevailing situation of underdevelopment in their home countries. Migrant workers are afraid to go back to their countries.

The prospect of unemployment, economic insecurity and low wages are the conditions that migrant workers have to face if they do come back. Thus, it is a very serious concern for migrants if the economic gains that they seek with overseas employment come under fire by the host governments.

Seeing how their rights in host countries are being attacked, migrant organizations are also steadily realizing the crucial question of the development of their countries as the key to resolving their need for overseas employment in order to survive. With the defense of their rights in the host countries also comes the defense of rights in their homeland in terms of wages, land, and employment.

The case of the campaign of migrant workers in Hong Kong highlights the point that the issues the social and political movement of migrant workers is addressing are related to the development of their own countries.

The Hong Kong government has for the past five years been persistent in pushing for the wage cut of migrant workers. They have twice succeeded in doing so.

Such attacks elicited an overwhelming opposition of migrant workers. The Asian Migrants Coordinating Body (AMCB) in more than one occasion has been able to mobilize thousands of migrant workers against the wage cut. On February 23, 2003, AMCB led a 12,000-strong march of migrant workers. This was a first in the history of the migrants movement in Hong Kong and possibly of Asian migrants in the world.

While the organized strength of the migrants take on the cudgels of the fight, migrant serving institutions also play its crucial role.

The Mission for Filipino Migrant Workers (MFMW) continue to provide assistance in building the organized strength of migrants. In fact, it was the MFMW that paved the way for the establishment of the United Filipinos in Hong Kong (UNIFIL-HK), one of the prime movers in the establishment of the AMCB in 1996.

The Asia Pacific Mission for Migrants (APMM) spearheaded the formation of MIGRANTE International – the global alliance of Filipino migrant organizations – in 1995.

MIGRANTE International is now at the forefront of the struggle for the rights of migrant workers. It leads in the protection and promotion of the rights and wellbeing of overseas Filipinos. Basic to the goal of MIGRANTE International is the achievement of a society that will address the primary economic problems of the country in order for forced migration to cease. Thus it campaigns against national policies and programs that subvert the development of basic industries and the development of agricultural production in the country.

A part of the efforts of MIGRANTE International to achieve this goal is the formation of a sectoral party of migrant workers, the MIGRANTE Sectoral Party. Through this party, migrant workers aim to utilize the electoral arena in order to gain benefits for the protection of the rights of migrant workers. It is their hope that the political structure of the country can bring some reforms that will alleviate the grave situation of Filipino overseas.

The experiences of the MIGRANTE International and the AMCB are now being gathered to pave the way for the formation of the International Migrant Alliance – the current thrust of the APMM. In the continuing and increasing clamor for the rights of migrants workers, it is perceived that the IMA will lead the global struggle of migrant workers to address their economic, social and political issues.

Conclusion

The increase of number of migrant workers from labour exporting countries, the continued reliance to remittances, and the growing movement for the defense of the rights of migrant workers are clear indication that development aids have not, until now, trickled down to the level of the grassroots people.

Poverty remains unabated and has in fact increased if we are to base it in the number of people who are forced to migrate for work and the resulting growth of social and political movement of migrants.

Development aids are not being used to address the needs of the grassroots. Moreover, its changing focus towards military assistance will mean that the benefits of development aids will not be on employment and livelihood enhancement of the majority. It will not be for the strategic stabilization of the economy of recipient countries.

For as long as the situation remains so, the effectiveness of development aids in receiving countries will continue to be in question.