Migration and Remittances

Transcription

1 Migration and Remittances Recent Developments and Outlook Dilip Ratha Global Remittance Working Group Coordinator for Technical Areas 1 and 2 January 20, 2016 Washington D.C.

2 Remittance flows to developing countries to reach $441* billion in $ billion FDI Remittances Pvt debt & port. equity ODA 0 *$441 billion including Argentina, Hungary, Russia

3 Excluding flows to China $364 Billion Remittances $264 Billion FDI

4 Top recipients of remittances $ billion, 2015e as % of GDP, Source: World Bank (2015), Migration and Development Brief 25, October 2015

5 Regional trends ECA: sharp decrease in remittances (-18%) MENA: remittances expected to grow only by 1.6% in 2015 due to Euro depreciation

6 Remittance dependent countries more impacted in ECA 42 as % of GDP,

7 Exchange rate effects: Kyrgyz Republic % change, Q2-2015/Q Ruble Local Cur. (Nominal) Local Cur. (Real) US$

8 Remittance growth rates vary depending on currency of denomination Kyrgyz Ruble Growth in remittances from Russia (%, yoy, Q2 2015/Q2 2014) Local Currency (Nominal) Note: Russian Ruble depreciated 34% against the US dollar during the same period. Source: Bank of Russia and World Bank Staff estimates. % change in Local Currency Exchange Rate relative to: Local Currency (Real) US$ Ruble US$ Rep Moldova Tajikistan Ukraine Uzbekistan

9 Russia s remittances outflows are closely related to the oil price Remittances ($ bil, left scale) Oil Price ($/barrel, right scale) Sources: Remittance data are from IMF Balance of Payments Statistics. Oil price is the average crude oil price from World Bank Commodity Price data.

10 2008 Q1, 2009 Q3, 2009 Q1, 2010 Q3, 2010 Q1, 2011 Q3, 2011 Q1, 2012 Q3, 2012 Q1, 2013 Q2, 2013 Q3, 2013 Q4, 2013 Q1, 2014 Q2, 2014 Q3, 2014 Q4, 2014 Q1, 2015 Q2, 2015 The cost of sending $200 has fallen but still above 5% 11% 10% 9% 8% 7% Source: Remittance Prices Worldwide, the World Bank

11 Banks remain the highest-cost of remittance service provider 16% 14% 12% 10% 8% 6% 4% 2% 0% Bank MTO Post Office Source: Remittance Prices Worldwide, the World Bank

12 The average cost of sending $200 is highest in Sub-Saharan Africa (Q3 2015) Global Average EAP ECA LAC MNA SAR SSA Source: Remittance Prices Worldwide, the World Bank

13 Major policy changes 2030 Sustainable Development Agenda Financing for Development De-risking by commercial banks New developments: Payment banks for remittances in India

14 Sustainable Development Goals 8.8 Protect labour rights and promote safe and secure working environments for all workers, including migrant workers, in particular women migrants, and those in precarious employment 10.7 Facilitate orderly, safe, regular and responsible migration and mobility of people, including through the implementation of planned and well-managed migration policies 10.c By 2030, reduce to less than 3 per cent the transaction costs of migrant remittances and eliminate remittance corridors with costs higher than 5 per cent

15 Financing for Development - AAAA Remittances cannot be equated to ODA Ensure adequate financial services for migrants Reduce cost of remittances by 2030 to less than 3%; no remittance corridor charges higher than 5% Address obstacles such as banks withdrawing services Remove obstacles to non-bank RSPs accessing payment system infrastructure Cheaper, faster and safer remittances through competitive, transparent market conditions Exploit new technologies, promote financial literacy and inclusion, and improve data collection

16 Reduce remittance cost 8% (Global average) $20 Billion annual savings 3%

17 Recruitment fees $4,000 Income per year $2,000

18 Reduce recruitment costs $4,000 $4 Billion for every 1 million migrants $0

19 Over $50 billion per year could be mobilized via diaspora bonds Diaspora size (millions) Estimated savings ($ billions) Developing countries East Asia & Pacific Europe & Central Asia Lat. America & Carib Middle East & N. Africa Sub-Saharan Africa South Asia Source: Ratha, De, and Yousefi (2014)

20 $100 billion idea Diaspora savings via diaspora bonds ($50 bn) Reducing remittance costs ($20 bn) Reducing recruitment fees paid by low-skilled migrant workers ($20 bn) Diaspora philanthropy ($10 bn) Using future-flows as collateral ($4-$25 bn for Africa alone)

21 Recent trends in refugees and migrants in Europe

22 Jan- 14 Feb- 14 Mar- 14 Apr- 14 May- 14 Jun- 14 Jul-14 Aug- 14 Sep- 14 Oct- 14 Nov- 14 Dec- 14 Jan- 15 Feb- 15 Mar- 15 Apr- 15 May- 15 Jun- 15 Jul-15 Aug- 15 Sep- 15 Oct- 15 First time asylum applications in EU-28 has risen sharply Thousand 0 Source: Eurostat

23 The number of migrants and refugees crossing into the EU more than tripled since thousandthousand Western Balkans/Albania-Greece Route 1500 Western African/Mediterranean Route Central Mediterranean Route 1000 Eastern Mediterranean Route Source: Frontex, as of August 2015

24 Number of refugees worldwide rising: 15.1 million (mid 2015) 18 million # of Refugees Source: UNHCR. Data on asylum seekers are available since the year 2000; chart does not include the 5.1 million Palestinian refugees (2014) UNRWA provides with assistance and protection.

25 Though still below historical highs % of world population (right axis) Source: UNHCR. Data on asylum seekers are available since the year 2000; chart does not include the 5.1 million Palestinian refugees (2014) UNRWA provides with assistance and protection.

26 Stock of refugees in Europe 3.2 million Source: UNHCR. Data on asylum seekers are available since the year 2000; chart does not include the 5.1 million Palestinian refugees (2014) UNRWA provides with assistance and protection.

27 Peak refugee episodes (midyear) 14.7 mn 17.8 mn 15.7 mn 14.4 mn 15.1 mn Afghanistan 5.6 Ethiopia 1.4 Mozambique 1.1 Afghanistan 4.5 Iraq 1.3 Mozambique 1.3 Afghanistan 2.7 Rwanda 2.2 Liberia 0.7 Syria 3.8 Afghanistan 2.5 Somalia 1.1 Syria 4.2 Afghanistan 2.6 Somalia 1.1 Excluding Palestinian refugees (5.1 million in 2014) Source: UNHCR

28 Key facts 86% of refugees are hosted by developing countries Major host countries are Turkey, Pakistan, Lebanon, Iran, Ethiopia, Jordan, Kenya, Chad, Uganda, and China Refugees: 8% of all international migrants IDPs: 6% of all internal migrants

29 Forcibly-displaced individuals totaled 79 million in 2014 Source: IDMC and UNHCR

30 Policy response to the crisis Need for a humanitarian and development response Refugees can impose fiscal and social costs, but allowed to work and engage in business activity, contributions become positive Need for innovative financing options Need for global solution

31 Global Knowledge Partnership on Migration and Development An open, inclusive, multidisciplinary knowledge partnership a global public good Aims to generate a menu of policy choices, based on analytical evidence, evaluation of policies, data collection, and quality control through peer-review Provides technical assistance and undertakes pilot projects

32 Thematic Working Groups/ Cross-Cutting Themes Thematic Working Groups: 1. Data on migration and remittance flows 2. Skilled labor migration 3. Low-skilled labor migration 4. Integration issues in host communities 5. Policy and institutional coherence 6. Migration, security and development 7. Migrant rights and social aspects of migration 8. Demographic changes and migration 9. Remittances, including access to finance and capital markets 10. Mobilizing diaspora resources as agents of social and economic change 11. Environmental change and migration 12. Internal migration and urbanization 13. Forced migration Cross-cutting themes: 1. Gender 2. Monitoring and impact evaluation 3. Capacity building 4. Public perceptions and communications

33 Summary 1. Remittances are still rising, but at a slower pace of only 2% in Flows to ECA are likely to decline by 18.3%. 2. Remittance costs are falling, but not fast enough. De-risking by banks poses a major risk to remittance flows. 3. The SDGs and FInancing for Development include goals to reduce remittance costs and recruitment costs, or about $40 bn out of a potential $100 bn financing idea. The missing elephant in the room is mobilization of diaspora investments. 4. The current migrant crisis is a global public good that requires a global solution. Refugees can benefit host countries in the longterm if allowed to work. Economic migration also needs to be addressed.

34 Thank you!