After exports, inward remittance from the expatriates is the second highest revenue earning sector for Bangladesh. But the country suffered 2.55 per cent fall in inward remittances last fiscal year (FY). According to official statistics, the inflow of remittances came down to US$14.93 billion last fiscal as compared to that of $15.32 billion a year ago.
The reasons were attributed to weak development activities in the Middle-East (ME) countries, mainly due to lower prices of petroleum products on the global market. The devaluation of the currencies of the United Kingdom (UK), Singapore and Malaysia against the US dollar also led to squeezing the flow of inward remittances.
It is estimated that nearly 8.0 million Bangladeshis are working in the Middle East alone. But the fact remains that those who are sending hard earned foreign currency to the country get little return after spending a fabulous amount of money for going there.
In fact, Bangladeshi migrants working in the multibillion dollar construction industry in Arabian Gulf countries are shouldering the costs of their own recruitment fees. A study suggests that the companies and their clients are reaping the benefits from inexpensive labour.
A study conducted by the New York University's Stern Centre for Business and Human Rights found that workers spend an average of 10 to 18 months' worth of salary paying off the fees that help facilitate their migration. A slide in oil prices has slowed down the pace of construction in the Gulf and impacted governments' abilities to pay for major infrastructure costs. But there is still strong demand for millions of low-wage construction workers, it added.
Qatar is investing heavily in the construction of stadiums for the 2022 World Cup it will host. In order to reduce the cost of labour on mega projects, a weakly controlled system for recruitment is passing on the costs to the workers themselves. Workers from Bangladesh are paying the highest fees in the world.
Rather than providing an opportunity for decent pay and better livelihood, construction industry practices across the Gulf are pushing workers into extreme debt and exacerbating abuses workers are likely to face, such as an inability to change jobs or move to another country due to indebtedness.
The study suggests that the construction firms and their Gulf-based clients could help 'end the cycle of abuse' by paying for the recruitment costs of construction workers who are needed to build the region's skyscrapers, stadiums, hotels, theme parks and sprawling malls.
It calls on Arab governments to enforce laws against the selling of visas and on migrant-sending countries to legalise and regulate their local networks of unregistered recruitment agents. There are laws in place banning Gulf-based employers from directly charging migrant workers for their own recruitment. Selling visas is also illegal in the Gulf Cooperation Countries (GCC). The countries are Saudi Arabia, the United Arab Emirates, Qatar, Kuwait, Oman and Bahrain.
The study found that governments in the Gulf countries provide migrant worker visas to multinational and local construction companies for free or at a nominal cost, but Gulf-based agents turn around and sell them at a mark-up to recruiters in Bangladesh along with other South Asian countries who then pass on the cost to the lowest-paid and most vulnerable workers. The workers have no choice other than to accept low-wage jobs with few protections for a chance to send money to relatives back home.
Despite many assurances, high migration cost for the jobseekers abroad could not be brought down. The manpower minister and overseas job-related state agencies have not yet succeeded in reducing ever-increasing migration cost. This has put the intending job-seekers under severe strains.
Due to some irregular practices by unscrupulous manpower recruiting agencies, the job-seekers are forced to spend a hefty amount of money, which is not so easy for them to earn within a short time. As such, workers stay for a longer time in their recruiting countries for making up the migration cost.
The Bangladesh Bureau of Statistics (BBS) survey found that only 25.33 per cent of the total remittances are being invested mostly in non-productive sectors, while the remaining foreign incomes are utilised for consumption purposes. The remittance-receiving households use 8.40 per cent of the total for savings and the rest 66.27 per cent for other unproductive expenditures.
It is, according to analysts, necessary to bring manpower brokers in both labour-sending and-receiving countries under a legal framework, and firmly regulate operations of licensed recruiting agencies to cut migration cost for the overseas jobs.
It is also necessary to explore job market beyond the Middle-East to help boost the country's inward remittances. The government needs to strive to lower remittance-sending fees and simplify relevant procedures to encourage the migrants to send money through official channel.
Meantime, the government needs to develop an institutional mechanism to minimise the influence of the intermediaries. If the migration cost is reduced, the economy will get better returns from remittances resulting in more investments. The official agencies should offer better institutional support for upgrading skills of overseas job-seekers and low-cost loan support for migration.