The Immense Cost 200 Million Migrant Workers Pay to Rescue their Families

On average, migrant workers send between 200 and 300 dollars home every one or two months. Contrary maybe to popular belief, this represents only 15 per cent of what they earn: the rest –85 per cent – stays in the countries where they earn the money. Credit: IFAD/Christine Nesbitt.

By Baher Kamal
MADRID, Jun 19 2019 – Straight to the point: while right and far-right politicians keep marketing their image with intensive campaigns of hatred, discrimination and stigmatisation against migrants, 200 million migrant workers worldwide will sacrifice over half a trillion dollars from their hard-earned money, to rescue 800 million members of their impoverished families. And that’s only this year 2019.

This huge amount adds up to more than three times the level of Official Development Assistance (ODA) and surpasses Foreign Direct Investment (FDI), stated the Rome-based International Fund for Agricultural Development (IFAD) ahead of the 16 June 2019 International Day of Family Remittances.

In fact, IFAD’s president, Gilbert F. Houngbo, on 14 June announced that remittances from international migrant workers to their families are expected to rise to over 550 billion dollars in 2019, up some 20 billion from 529 billion in 2018.

An impressive figure given that it corresponds to only 15 per cent of migrant workers’ earnings who total around 200 million out of the world’s estimated 260 million migrants.

An essential fact that is most often under-reported or even unreported at all is that 85 per cent of their earnings remain in the host countries.

“Behind the numbers are the individual remittances of 200 dollars or 300 dollars that migrants send home regularly so that their 800 million family members can meet immediate needs and build a better future back home. Half of these flows are sent to rural areas, where they count the most,” IFAD’s chief explained.

 

Though the benefits of migration outweigh the costs, public perception is often the opposite and negatively impacts migration policy.

Pakistani migrant workers build a skyscraper in Dubai. Credit: S. Irfan Ahmed/IPS

 

8.5 trillion dollars in just 15 years

An additional staggering fact is that if current trends continue, it is projected that 8.5 trillion dollars will be transferred to families in developing countries over the 15-year life of the 2030 Agenda for Sustainable Development.

”By then, it is estimated that over 2 trillion dollars (on average 25 per cent of remittances received) will have been saved or invested. If leveraged effectively, remittances can have an unprecedented multiplier effect on sustainable development,” said Houngb.

Remittances from international migrant workers to their families are expected to rise to over 550 billion dollars in 2019, up some 20 billion from 529 billion in 2018.

Gilbert F. Houngbo, IFAD President

 

Five big facts

Here are 5 facts provided, among others, by the UN about the transformative power of these often small – yet major – contributions to sustainable development worldwide:

  1. About one in nine people globally are supported by funds sent home by migrant workers

Currently, about one billion people in the world – or one in seven – are involved with remittances, either by sending or receiving them. Around 800 million in the world – or one in nine people– are recipients of these flows of money sent by their family members who have migrated for work.

  1. 2. What migrants send back home represents only 15 per cent of what they earn

On average, migrant workers send between 200 and 300 dollars home every one or two months. Contrary maybe to popular belief, this represents only 15 per cent of what they earn: the rest –85 per cent – stays in the countries where they actually earn the money, and is re-ingested into the local economy, or saved.

  1. Remittances remain expensive to send

These international money transfers tend to be costly: on average, globally, currency conversions and fees amount to 7 per cent of the total amounts sent.

  1. The money received is key in helping millions out of poverty

Although the money sent represents only 15 per cent of the money earned by migrants in the host countries, it is often a major part of a household’s total income in the countries of origin and, as such, represents a lifeline for millions of families.

In fact, it is estimated that three quarters of remittances are used to cover essential things: put food on the table and cover medical expenses, school fees or housing expenses. In addition, in times of crises, migrant workers tend to send more money home to cover loss of crops or family emergencies.

The rest, about 25 per cent of remittances – representing over 100 billion dollars per year – can be either saved or invested in asset building or activities that generate income, jobs and transform economies, in particular in rural areas.

  1. Half of the money sent goes straight to rural areas, where the world’s poorest live

Around half of global remittances go to rural areas, where three quarters of the world’s poor and food insecure live. It is estimated that globally, the accumulated flows to rural areas over the next five years will reach $1 trillion.

 

Why do migrants migrate

Having said that, a harsh question arises: why all these millions and millions of human beings have been forced to abandon their homes and families to fall prey to smugglers, deadly voyages, separation of their children, detention, torture, forced repatriation, etcetera?

Let alone being victims of human traffickers who buy and sell them as just human flesh merchandise to feed the business of prostitution, child recruitment as soldiers, slave-labourers and even for trading their organs?

 

Three chief reasons lay behind most of the migrants need to flee:

  •   Impoverishment: Most migrants and refugees proceed from former European colonies in Africa, Asia and Latin America and the Caribbean, from countries which had been practically enslaved under European military occupation and which, since their formal independence, have been easy prey to intensive exploitation by big private business. One of the dramatic consequences of that occupation and the ongoing exploitation is the deepening impoverishment of native populations, a fact that has been aggravated by the dominant neo-liberalism-led ‘globalisation.’
  •   Conflicts: most of the around 40 ongoing armed conflicts are due to either the fictitious splitting of nations and compact ethnic communities through aribitrarian borders imposed by former European colonisers, or more recently directly or indirectly fuelled by the voracious exploitation of natural resources by huge translational private business,
  •   Climate crisis: the growing wave of unusual droughts, floods, loss of harvests, of homes and lives, which is caused by climate change, which an immense number of the migrants’ countries of origin did no generate.

 

Just know that a whole continent like Africa, which is home to around 1,2 billion human beings, has contributed only 4 per cent to greenhouse gas emissions, while bearing the brunt of more than 80 per cent of its dramatic consequences.

These three main reasons lay behind the forced migration of so many millions of human beings, should suffice to explain why the number of people fleeing exploitation, wars and climate change-driven disasters, need to search for other places to feel safer or simply just survive, while working hard to help their families also survive.

 

NOTE: This article is a follow up to previous two reports of the same author, both published in Human Wrongs Watch: The Most Expensive 529 Billion Dollars, which details the huge human and economic cost of migrants remittances, and The Hellish Cycle focusing specifically on the case of Southeast Asia migrants.

Baher Kamal is Director and Editor of Human Wrongs Watch