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Opportunuties And Challenges Of International Migration For Sending And Receiving Countries

 

Yavuz KÜL (*)

1. Introduction:

International migration, the movement of people across international boundaries, continues to be one of the most important issues of the global policy agenda for it generates enormous economic, social, and cultural implications in both sending and receiving countries. According to a recently published report of Global Commission on International Migration (GCIM), today, there are nearly 200 million migrants internationally around 60 % of which are in developed countries, and the other 40 % in developing countries. The report also acknowledges that almost one of every 10 persons living in developed countries is a migrant. The more developed regions receive each year about 2.3 million migrants coming from the less developed regions, accounting for two thirds of their population growth (1).

The increase in the total number of migrants boosted the flow of formal remittances from migrants to their relatives in their country of origin as well. The remittance flow has doubled in the last decade, reaching 216 billion US Dollars in 2004, with 150 billion US Dollars going to developing countries (2). It surpasses foreign aid and is the largest source of foreign capital for dozens of countries (3).

Historically, migration was considered and used as a last resort to maintain a moderate living standard which was deemed impossible to acquire in origin countries, and at the time it successfully responded to significant labor needs of the destination countries. Then, migrants had no difficulty to find jobs in host countries. With the economic turbulences fueled by the global oil crises, migration was essentially stopped and almost in all countries it tended to be more and more concentrated around family and/or humanitarian migration (4).

However, economic, demographic and political developments coupled with the mounting concerns over the future of labor supply have renewed the attention of policy-makers on labor migration issues once again. Those were the years of a good economic climate, high economic growth and lower unemployment rates in some developed countries. The demographic developments in those countries, on the other hand, tended to imply an ageing workforce and ultimately result in a declining population of working age. In such environment, employers started to experience difficulties in finding workers with necessary qualifications. This meant a renewed interest in services of migrant workers (5). The need for migrants coincided with the growing global unemployment crisis, and the migrants enthusiastically responded to the calls for recruitment by the developed economies.

At the same time, the governments of the developed countries inclined to develop policies which placed new mechanisms in order to better address their labor market needs. The new immigration policies were selective in nature and targeted those migrants who can fully respond to the labor market needs and easily integrate with receiving communities, causing new challenges for the economies of sending countries.

Against this backdrop, the need for formulating effective policies, which will enable the governments of the receiving countries to reconcile the interests of their populations and the demands of millions who are in search of better living standards, has become the most daunting issue to address. The answer to this question is certainly not an easy one and requires meticulous analyses of the issue considering the fact that we live in such a globally interconnected world that any decision taken in one country for action will have to take into account the possible adverse effects it may give rise in another.

This study purports to analyze policies directed to the recent flow of migrants, discuss the prospects provided by the international migration to fill the labor market shortages of the developed countries and, pin down the possible implications of the migrant workers’ remittances for origin countries. For the sake of clarity and better understanding of such a complicated issue, the reader is also provided with an overview of recent international migration trends in the following chapter.

2. The Recent Trends of International Migration:

The patterns of the flow of people between countries are widely influenced by international economic, political and cultural interrelations. International economic disparities, poverty and environmental degradation, combined with the absence of peace and security and human rights violations are all factors affecting international migration.

Today, it is estimated that there are nearly 200 million migrants are living in countries in which they were not born. Around 60 % of all recorded migrants are now to be found in the developed countries, and the other 40 % in developing regions. According to the most recent UN statistics, Asia has some 49 million migrants, Africa 16 million and the Latin America and Caribbean region 6 million (6).

It is also worth to note that the composition and concentration of stock of migrants considerably differ from those of the past. According to a UN publication entitled Trends in Total Migration Stock, most of the migrants are concentrated in a small number of countries. 75 % of migrants are found in just 28 countries. Another interesting observation of the report is that 49 % of total migrants are women. Finally, report concludes, all countries are now affected by migration and many, if not most, can be categorized as countries of “origin, transit and destination” (7).

The predominant form of migration varies considerably from one part of the world to another as well. In Asia, for example, many migrants move on the basis of temporary labor contracts. In Americas and Africa, irregular migration is far more common phenomenon. Countries such as Australia, Canada, New Zealand and the USA continue to accept migrants for permanent settlement and citizenship, while the countries of the Middle East usually admit international migrants for fixed periods. In Europe, the major preoccupation of recent years has been the arrival of asylum seekers from other parts of the world (8).

As indicated earlier, for decades, migration to today’s developed countries was work-oriented. However, the global oil crises have put an end to this type migration in most developed countries, saving only family and humanitarian migration.

What renewed the attention of policy-makers on labor migration issue was nothing but a mere result of new economic, demographic and political developments. A good economic climate and years of economic growth in some developed countries have led to increasing employment, higher participation and lower unemployment rates. The demographic developments in those countries, on the other hand, tended to imply an ageing workforce and ultimately result in a declining population of working age. Aging population of developed economies coupled with falling fertility rates created serious concerns over sustainability of labor markets. As a result, the capacity of these economies to digest a bigger stock of migrants was expanded.

However, having faced with serious difficulties concerning the integration of previous stock of migrants into their societies, the governments of the receiving countries started to be more selective in their immigration policies. They tended to target those migrants who can better respond to their labor market needs and easily integrate with their communities. The new policies also helped the receiving countries bring some sort of stability to the flow of migrants as well. Needless to say, such policies had created new implications on the economies of sending countries. The loss of qualified human resources for many countries of origin is the one which has been most cited.

The upshot is, the number of migrants continues to grow despite the changes in the immigration policies of the receiving countries to stabilize it. The current global job crisis seems to do nothing but fuel this tendency in the coming years. ILO statistics indicate that in 2005, some 191,5 million people around the world were unemployed, an increase of 2.2 million since 2004 and 34.4 million since 1995. Almost half of the unemployed people in the world are young people. And young people are more than three times as likely as adults to be unemployed (9). Increasing number of women and men in developing countries are today looking for employment opportunities elsewhere as they are unable maintain a livelihood in their home countries. Needless to say, this promises a higher rate of growth in global stock of migrants.

3. The impact of International Migration on Economies of Sending and Receiving Countries:

Winters and Walmsley, in their recent publication of Liberalizing Temporary Movement of Natural Persons: An Agenda for the Development Round, estimated that an increase of inward movements of equivalent to 3% of developed countries’ skilled and unskilled work forces would generate an estimated increase in the world welfare by 156 billion US Dollars, shared almost equally between developing and developed countries (10). This estimation is based upon a hypothesis which assumes that by allowing workers to move to areas where they are more productive and valued, migration leads to a direct increase in global output and income.

In the light of Winters and Walmsley’s estimation and extensive analyses put forward by some others (11), it is safe to say that international migration can have positive impacts on both the communities of origin and the communities of destination, providing the former with remittances and the latter with needed human resources. International migration also has the potential of facilitating the transfer of skills and contributing to cultural enrichment. This said, one should also maintain that international migration entails the loss of human resources for many countries of origin and may give rise to political, economic or social tensions in countries of destination.

a. The Impact of International Migration on the Economies of Sending Countries:

The increasing volume of remittances generated by the migrant workers and the impact of this financial flow on the development and poverty reduction in the sending countries seems to justify Winters and Walmsley’ assumption. According to the World Bank, the annual value of formally transferred remittances in 2004 was about 150 billion US Dollars, representing a 50 % increase in just five years (12). Almost half of these remittances are transferred between countries in the developing world. The leading recipients of remittances in 2004 were Mexico with 16 billion US Dollars a year, India with 9.9 billion US Dollars and the Philippines with 8.5 billion US Dollars (13). Remittances are now close to triple the value of the Official Development Assistance (ODA) provided to low-income countries and comprise the second-largest source of external funding for developing countries after Foreign Direct Investment (FDI). Significantly, remittances tend to be more predictable and stable than FDI or ODA.

In short, remittances now play an essential role in sustaining national and local economies in many recipient countries. Remittances provide an important source of foreign exchange to recipient countries, boost the capacity of the financial sector and help to attract subsequent investment. Remittances evidently provide the most direct and immediate benefits to the people who receive them, many of whom, the World Bank has established, are amongst the poorest members of society (14). Remittances help to lift recipients out of poverty, increase and diversify household incomes, provide an insurance against risk, enable family members to benefit from educational and training opportunities and provide a source of capital for the establishment of small businesses.

Recognition of positive impact of remittances on the economies of developing countries is important and must be promoted. In this context, the governments of sending countries must adopt sound exchange rate, monetary and economic policies, facilitate the provision of banking facilities that enable the safe and timely transfer of migrants' funds. They should also promote the conditions necessary to increase domestic savings and channel them into productive investment.

Migration can, however, also result in the loss of the most skilled and best educated human resources of the developing economies. In other words, brain drain deprives the state of revenue and prevents countries of origin from gaining an early return on the investment they have made in the education and training of those people. Most seriously, when it involves the departure of professionals in sectors such as health and education, migration can adversely affect the supply and quality of essential services.

Mostly, the problems caused by the brain drain in poorer sending countries are enormous. Migrants from developing countries are generally more likely to stay in the host country than migrants from advanced countries. Survey evidence on the share of foreign PhD graduates in science and technology who stay abroad show that 79% of 1990-1991 doctoral recipients from India and 88% of those from China were still working in the United States in 1995. In contrast, only 11% of Koreans and 15% of Japanese who earned science and engineering (S&E) doctorates from US universities in 1990-1991 were working in the United States in 1995 (15). According to the International Organization for Migration (IOM), some 300 000 professionals from the African continent live and work in Europe and North America. By some estimates, up to a third of R&D professionals from the developing world are believed to reside in the OECD area (16).

The sending countries will have to attract back these emigrants in order to assure that their fragile economies will be able to maintain enough number of highly skilled professionals for development. Regaining them can also bring valuable management experience, entrepreneurial skills and access to global networks. However, experience shows that such efforts have, for most of the time, been fruitless.

One way for sending countries to alleviate the negative impact of brain drain is to facilitate the return of migrants and their reintegration into their home communities, and to devise ways of using their skills. To encourage the return of qualified migrants who can play a crucial role in the transfer of knowledge, skills and technology is also a well recognized way of tackling with the issue of brain drain.

The receiving countries can also play an important role in this respect. Use of short-term and project-related migration, as a means of improving the skills of nationals of sending countries can be a very helpful instrument. Bilateral or multilateral agreements can be signed and implemented for this purpose.

b. The Impact of International Migration on the Economies of Receiving Countries:

There are conflicting views on the impact of immigration on the economies of receiving countries. Opponents of immigration believe that migrants steal the jobs and depress the wages. Another argument that the critics of immigration relies on is that immigration has the potential of producing conflict among ethnic groups. The reasoning behind this assumption is the possibility of emergence of such an environment in which low-income native-born groups regard the migrants as competing for jobs and resources. Finally, the opponents of immigration argue that increasing number of migrants may destroy the local community’s identity and its institutions.

Proponents of immigration, on the other hand, contend that immigrants are not the cause of job loss on the side of local population as they mostly do those works which are considered too menial by their host societies. The proponents also add that migrants create added value to the economy since they are also consumers and stimulate the economy which in turn creates new jobs. International migration, proponents add, has the potential of facilitating the transfer of skills and contributing to cultural enrichment.

The governments of the receiving countries seem to give credit to both the opponents and proponents of immigration. Indeed, there is a growing tendency on the part of receiving countries to be more selective in their immigration policies which restrict immigration to highly skilled workers. Countries like Switzerland, United Kingdom, Canada, Ireland, New Zealand have already either introduced such policies or are envisaging to introduce (17).

Another mechanism commonly used by the receiving countries to control the flow of migrants is to receive migrant workers on temporary basis. This type of immigration is generally related to international study, “working holiday making” (movements of young persons allowed to work part-time in generally low-skilled jobs while vacationing) and to intra-company transfers in multinational corporations (18). Australia, Germany, Canada, France, Italy Norway, Spain, Sweden and the United States are countries which attract this type of migrants.

However, there is still not enough evidence to conclude that these mechanisms are or will be producing the desired outcomes. In the case of temporary migration, there seems to be a consensus among the experts that this type of migration, in the long run, bears the potential of transforming itself into permanent migration. There are deficiencies and adverse effects of selective policies as well. It may encourage the potential migrants to seek asylum to be able to reach the labor markets of the developed countries. It also has negative implications on the economies of developing countries as it creates the potential of a bigger loss of skilled human resources for their economies.

4. Migration as an Answer to the Aging Population of the Developed Countries:

Population ageing is defined as the process by which older individuals become a proportionally larger share of the total population. It is a result of demographic transition in which mortality and then fertility rates decline (19). According to the UN statistics, the total fertility rate decreased globally by almost half, from 5.0 to 2.7 children per woman in last 50 years, and it is expected to drop to the replacement level of 2.1 children per women in the next half century. Presently, the total fertility rate is below the replacement level in all industrialized countries (20). This development has tripled the number of older persons in the last 50 years. It is also expected that this number will more than triple again in the next 50 years, raising serious concerns over sustainability of social security systems (21).

Aging population has significant implications on labor markets as well. Older people today are significantly less likely to participate in the labor force than they were in the past. Labor force participation of persons aged 65 or over declined by more than 40 % at the global level in last half century. In 1950, about 1 in every 3 persons aged 65 or over was in the labor force. In 2000, this ratio decreased to just less than 1 in 5 (22).

This is an alarming situation for the developed countries for it creates serious labor shortages for their economies. According to the OECD, in the medium term, as early as 2015, the increasing number of retirees will in some occupations lead to a replacement labor demand that may be hard to fill from domestic labor supplies for some developed countries (23).

Does this imply a more favorable environment for international migration? The answer of the proponents of immigration will certainly be a positive one. Their conclusion is based upon on the assumption that the resident labor supply is/will be insufficient to meet the increasing labor demand. However, governments of the developed economies are still resisting an increased inflow of migrants with a view that the unused resident labor supply is sufficient to solve the present and future labor shortages. Instead of opening their borders, they tend to only facilitate the immigration of highly skilled workers for occupations where the national labor market cannot supply sufficient labor (24)

It is too early to make a meaningful prediction on whether the strategy of these governments will be successful to address their future labor market shortages. Further analytical studies and broader data are necessary to be able to see a clearer picture of the future. However, even in the absence of such information, it is safe to assume that the developed economies will be forced to open their borders to the migrant workers should the current trends concerning aging and fertility rates continue to rise.

5. Integration of Migrant Workers into the Labor Market:

Another issue that begs for attention is certainly the integration of current stock of immigrants, their children and future arrivals into the labor markets of the host societies. Here, integration means that as migrant workers learn the language and work practices of host countries, they tend to acquire the necessary ability to meet the requirements of the labor markets that they wish to participate in.

There are certain barriers which make it impossible for the migrant workers to integrate with the labor markets of the host societies. Non-recognition of diplomas attained in the country of origin, discrimination with respect to access to employment, low wages and additional barriers for immigrant women’s participation in the labor markets are the most cited ones. Needless to say, selective immigration policies positively influence integration since the migrants in question are selected to ensure a better and faster integration. However, there are millions of migrants who are recognized asylum seekers or admitted on the basis of family reunification and generally recognized human rights. These are the groups of migrants who need special attention to assure their integration.

Language training, more favorable regulations with respect to the recognition of certificates and diplomas attained in origin countries, creation of special networks which assist migrants in their search for jobs, designing and implementing programs targeted to the elimination of discrimination against immigrants and broadening education opportunities for the children of immigrants, the so-called “second generation” are some of the measures that can be taken for better integration of migrants.

6. Conclusion:

Human-being has a natural tendency to migrate. This tendency is either an acquired peculiarity as a result of repeated practices over millions of years or coded in our genes. However, it is there and stimulates us to move from one place to another as we did shortly after we rose on our feet in the savannah of Africa and consistently repeated later on. The reason behind this everlasting tendency has been our quest for a better life, and as long as the need for a better life stays there, we will continue to migrate.

Migration to uninhabited lands has not created any potential for conflict since there was no interest to be challenged. Conflict arose when the migrating people were forced to crystallize their quest for a better life on the expanse of others’ well-being. This explains why historically most of the conflicts took place as a result of movements of people.

Today, all of societies are settled in territories with defined and recognized boundaries with a few exceptions, and the movements of peoples to such an extent that bear the potential of creating conflicts are unimaginable. However, immigration still takes place and sometimes gives rise serious tensions within receiving societies. As a matter of fact, one can not help but picturize a future world in which migrants and members of their host communities are involved in a widespread conflict. Indeed, such an undesirable development may occur when the members of a host society feels that their distinct identity is threatened as a result of increasing stock of migrants. This is a worst case scenario but a possible one.

For this to be avoided, policy makers of the receiving countries should proactively engage in a dialogue with their societies so as to eliminate those myths which claim that societies are biologically distinctive from each other and that increase in stock of migrants could result in the destruction of certain peculiarities of the society. Further efforts should also be put in designing such educational programs explaining why immigration is necessary to maintain the current level of economic development and how it helps to alleviate the impacts of aging and decreasing fertility rates.

Another challenge needs to be met by the governments of host societies is the need to provide migrants and their families with the opportunities which will help them easily integrate with their host societies. Language training and better participation into the labor markets are particularly important in this regard as such policies will also expand the receiving communities’ capacity to digest the current stock of migrants.

(*) İkinci Katip, Ekonomi, Kültür-Yurtdışı Tanıtım Müsteşar Yardımcılığı, Dışişleri Bakanlığı

REFERENCES

1. Global Commission on International Migration (2005), “Migration in an Interconnected World: New Directions for Action,” Geneva: Switzerland.

2. World Bank (2006), “Global Economic Prospects 2006: International Remittances and Migration,” Washington, DC: United States.

3. Ratha, Dilip (2005), “Workers’ Remittances: An Important and Stable Source of External Development Finance,” Chapter 1 in Remittances: Development Impact and Future Prospects, eds. Samuel Maimbo and Dilip Ratha, Washington, DC: United States.

4. OECD Working Party on Migration (2005), “The Labor Market Integration of Immigrants in OECD Countries and Temporary Migration,” Paris: France.

5. OECD (2003), “Labor Shortages and the Need for Immigrants: A Review of Recent Studies,” Paris: France

6. Global Commission on International Migration (2005), “Migration in an Interconnected World: New Directions for Action,” Geneva: Switzerland.

7. United Nations Department of Economic and Social Affairs Population Division (2004), “Trends in Total Migrant Stock,” New York: United States.

8. Global Commission on International Migration (2005), “Migration in an Interconnected World: New Directions for Action,” Geneva: Switzerland.

9. International Labor Organization (2006), “Global Employment Trends 2006,” Geneva, Switzerland.

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13. Global Commission on International Migration (2005), “Migration in an Interconnected World: New Directions for Action,” Geneva: Switzerland.

14. World Bank (2006) “Global Economic Prospects 2006: International Remittances and Migration,” Washington, DC: United States.

15. OECD, (2002) “International Mobility of the Highly Skilled,” Paris: France.

16. Devan, J. and Tewari, P.S. (2001), “Brains Abroad,” McKinsey Quarterly No. 4.

17. OECD Working Party on Migration (2005), “Trends in International Migration: Summary of Discussions at the SOPEMI Correspondents’ Meeting of 7-9 December 2005,” Paris: France.

18. OECD Working Party on Migration (2005), “The Labor Market Integration of Immigrants in OECD Countries and Temporary Migration,” Paris: France.

19. United Nations Population Division (2001), “World Population Ageing 1950-2050,” New York: United States.

20. United Nations Population Division (2001) “World Population Ageing 1950-2050,” New York: United States.

21. Creedy, J. (1998), “Pensions and Population Ageing: An Economic Analysis,” Cheltenham: United Kingdom.

22. United Nations Population Division (2001), “World Population Ageing 1950-2050,” New York: United States.

23. OECD (2003), “Labor Shortages and the Need for Immigrants: A Review of Recent Studies,” Paris: France.

24. OECD (2003), “Labor Shortages and the Need for Immigrants: A Review of Recent Studies,” Paris: France.