The Importance Of Migrant Workers
I found this interesting, given how migrant workers are generally viewed.
Migrant workers abroad will send $406 billion back to their home countries this year, the highest level in over a decade, according to a new report by the World Bank. This money, also known as remittances, typically goes from developed to developing countries. It’s an important, and as it turns out, possibly more reliable source of foreign funding for poorer nations than other sources.
In the face of external economic shocks, remittance money is more stable than flows of foreign money like foreign direct investment (FDI) or money transferred into the country by individuals from business or investments abroad. In 2009, the worst moment of the financial crisis, global remittances fell 5.5% from 2008 while FDI and private debt and portfolio equity dropped off dramatically and suddenly, according to a 2011 report from the UNDP. Remittances can even rise during financial crises and natural disasters because migrants living abroad send more money home to help their families.
In contrast to foreign aid, usually channeled through organizations, remittances go straight from a migrant worker to his or her family and friends and can be better tailored to people’s needs. Official foreign aid provided by governments, sometimes seen as an extension of a country’s foreign policy, is often vulnerable to diplomatic ups and downs as well.