Around one million Sri Lankans are working abroad, not counting the nearly 600,000 Lankans permanently domiciled overseas. They are one of the biggest contributors to the local economy, sending around US$ 7 billion back home per year. Along with the garment industry, Ceylon Tea and tourism, this is one of the biggest drivers of the local economy.
Indeed, this is why the Government has coined the term “Rata Wiruwo” (Expatriate Heroes) to describe the overseas workforce. Over the last 10 years, departures of female workers who are mostly employed as housemaids, have fallen while the number of male workers has increased. All expat workers sweat and toil in often inhospitable and non-ideal conditions to seek a better tomorrow for their loved ones back home. Today (June 16), we celebrate their commitment and dedication, on The International Day of Family Remittances (IDFR).
The money migrants send home helps families put food on the table, send their children to school and support economic development and job creation. Worldwide, expatriate remittances are one of the biggest funding sources for economic development. We are looking at one billion senders and receivers, and a projected US$6.5 trillion in remittances to be sent to low- and middle income countries between 2015 and 2030.
India has retained the top position as recipient of remittances with its Diaspora sending about $69 billion back home last year, the World Bank said. In its latest Migration and Development Brief, the World Bank estimated that officially recorded remittances to low-and middle-income countries reached $466 billion in 2017. This was an increase of 8.5 per cent over $429 billion in 2016.
India was followed by China ($64 billion), the Philippines ($33 billion), Mexico ($31 billion), Nigeria ($22 billion) and Egypt and Pakistan ($20 billion each) last year. Global remittances, which include flows to high-income countries, grew 7 per cent to $613 billion last year, from $573 billion in 2016. Global remittances are expected to grow 4.6 per cent to $642 billion in 2018. The Bank said remittances to South Asia grew a moderate 5.8 per cent to $117 billion. In 2018, remittances to the region will likely grow modestly by 2.5 percent to $120 billion.
The upsurge is likely to continue into 2018 on the back of stronger economic conditions in advanced economies (particularly the US) and an increase in oil prices that should have a positive impact on the Gulf Cooperation Council countries which absorb most of the workers from developing nations.
In the early days of migrant labour, there were only a few legal channels for sending money back home. Today, legal methods (banks and money transfer specialists) are widely available, but commissions and transmission costs can sometimes lessen the impact of the monies sent home. The global average cost of sending US$ 200 was 7.1 per cent in the first quarter of 2018, more than twice as high as the Sustainable Development Goal target of 3 per cent. Better partnerships between national post office systems and money transfer operators are needed to widen the appeal of easy remittances. However, many countries are still reluctant to allow more efficient technologies - such as Internet and smartphone apps and the use of crypto currency and blockchain in remittance services. More must be done to bring down the high cost of remitting money so that families receive more funds.
Current estimates show that 75 per cent of remittance flows go to meet immediate family needs, but the other 25 per cent – over US$100 billion a year – is available for other purposes. Given better opportunities to save, remittance families will save more. Given appropriate investment options, remittance families will invest more. The potential impact of remittances can only be fully realized in concert with coherent public policies and priorities. The Sri Lanka Bureau of Foreign Employment and the Ministry of Foreign Employment Promotion and Welfare must formulate such programmes in consultation with other relevant institutions. The idea behind foreign employment is that they will have a higher living standard – and a mechanism of continuing that once they settle down here for good.
There should be more facilities for expat workers on their return to the Motherland. The duty free allowance of US$ 1,750 granted to them for purchasing household goods seems rather puny by comparison to the massive US$ 50,000 duty free vehicle concession granted to our public representatives. Workers who have been employed abroad for 5-10 years should be given a duty-free permit to buy a motorcycle or a small 1,000 CC car, considering the funds they would have remitted during that period.
The welfare of migrant workers and their families should be uppermost in our minds. Many problems crop up in families where the mother or father has gone abroad – mechanisms should be drawn up to address these issues. Indeed, while we do have welfare officers in the Middle East and elsewhere, there is no equivalent service locally to inquire into the well-being of their families. This must be rectified. Expatriate workers are a precious resource for our economy and they must be given all necessary facilities and incentives.
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