Safe migration to boost remittances

| Updated: October 23, 2017 11:56:55

Safe migration to boost remittances

The Chief of the International Organisation for Migration (IOM) in Bangladesh observed that reinforcing governance in regulating the country's migration sector is a big challenge.
 Addressing a recent consultative meeting, he said irregular migration is an issue of concern for Bangladesh government. Lack of regular migration and insufficient scopes of legal channels are prompting the people to take desperate journey to reach the countries of destination, he added.
For Bangladesh, although the process of migration has again gained ground after a long period of lull following oil price slump that had affected the Middle-East economies, there has been remarkable fall in inward remittances. On the other hand, the cost of workers' migration has gone beyond the affordability of the poor people amid such incoming of poor remittance. 
Migration cost in Bangladesh is reportedly one of the highest in the world. Most migrant workers borrow high-cost loans from local money lenders. In fact, the lion's share of their remittances sent home out of their earnings goes to repay the loans. Despite many assurances from the government, high migration cost for the jobseekers abroad could not be brought down. The manpower minister and overseas job-related state agencies have not been able to reduce the rising cost of migration. This has otherwise put the intending job-seekers under severe strains.
Every year, more than 400,000 Bangladeshis are now leaving the country to work overseas. For a developing country like Bangladesh, higher inflow of remittance is one of the major driving forces of our economy.
But the falling remittance inflow has registered a negative growth that might cast some dampening effects on domestic demand, according to the central bank. Such negative growth (-17.8 per cent) might affect the domestic demand, according to the Bangladesh Bank Quarterly (BBQ) report. The BB observations came in the backdrop of a falling trend in the flow of inward remittances in recent months.
The inward remittance flow dropped significantly in the recent months following a sluggish trend in economic activities in the Middle-East countries coupled with a rising trend in sending hard-earned money by expatriate Bangladeshis through informal channels. The overall economic growth may face an adverse impact in future if the existing downward trend in inward remittance continues.
The overall remittance inflow has dropped by nearly 17 per cent or US$ 1.86 billion in the first nine months of this fiscal year (FY) 2016-17, against the same period of the previous fiscal. Remittance receipts came down to $9.19 billion during the July-March period, from $11.06 billion in the same period of the last fiscal, the latest BB data showed. 
On the other hand, most of the Bangladeshi workers abroad are meagrely paid. If they part with 11-12 per cent of their earnings for repaying loans, it is simply impossible for them to save or invest in their home country. Of their total earnings in foreign exchange, nearly 11 per cent is spent for repaying loans they borrowed for going abroad, and one per cent on paying off their other outstanding loans, says a recent Bangladesh Bureau of Statistics (BBS) survey. 
The BBS study has also 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 has revealed.
According to analysts, it is 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. They suggest that job contracts signed between the migrant workers and the employers must specifically mention their wages, and contain provisions for welfare, healthcare and other social security.
What is worrying is that many recruiting countries are not interested in hiring manpower from Bangladesh due to high migration cost. As a result, the country is losing a big amount of foreign exchange from this sector. In fact, high migration costs in overseas recruitment have been eating up the benefits of migration. The migrant workers are constrained to overstay their contracted periods thinking they will be able to repay their debts in addition to remitting money to the country after meeting their subsistence costs. That is exactly why they turn illegal migrants in the eyes of the host countries -- virtual fugitives from the law. 
The government needs to develop an institutional mechanism to minimise the influence of the intermediaries. If migration cost is reduced, the economy will get better returns from remittances resulting in more investments. The government agencies should offer better institutional support for upgrading skills of overseas job-seekers and low-cost loan support for migration.
There is a need 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 so that the migrants are encouraged to send money through official channel.
There is, however, a need for modernising and digitising labour recruitment process, maintaining transparency in all agreements signed between the labour-recruiting and sending nations, and making those public on websites. Social implications of migration that have been ignored for long should furthermore be taken into consideration while framing policies. 
All said and done, it is necessary to lay thrust on the legal migration channels and protection obligations for reducing migrants' vulnerabilities. The challenge before the country is how to keep the narrative associated with migration positive, how to keep the migrants safe, and how to ensure that they do not lose their rights in geo political turmoil.  
[email protected]

Share if you like

Filter By Topic