The Bank has just published a new book (edited by Sirkeci, Cohen and Ratha - see here) that documents the impacts of the recent financial crisis on migration and remittance flows. A common story line emerging from a number of regional and country specific experiences is the remarkable resilience of remittance flows during the crisis. Beyond this observation, the book highlights variations in factors affecting migration and remittance patterns during the crisis and suggests a number of hypotheses for future research. The book is certainly not the last word on the topic of crisis impacts, but it marks an early stock taking of this evolving topic.
Knowledge product innovation in ECA: The case of MIRPAL
It is almost eighteen months since World Bank Europe and Central Asia (ECA) region launched a program of knowledge sharing in the post crisis environment for countries heavily dependent on remittances and looking for ways to address the
With Sanket and Ani
We have just released Migration and Development Brief 11 (see accompanying presentation) reporting latest data on remittance flows. Newly available data show that officially recorded remittance flows to developing countries reached $338 billion in 2008, higher than our previous estimate of $328 billion. Based on monthly and quarterly data released by some central banks and in line with the World Bank’s global economic outlook we estimate that remittance flows to developing countries will fall to $317 billion in 2009. This 6.1 percent decline is smaller than our earlier expectation of a 7.3 percent fall.
By now it is clear that existing migrants are not returning even though the job market has been weak in many destination countries; instead they are staying on longer and trying to send money home by cutting living costs. New migration flows are lower due to the economic crisis, but they are still positive. We maintain our expectation of a recovery in migration and remittance flows in 2010 and 2011, but the recovery is likely to be shallow.
Yesterday an exciting panel of committed global experts and international leaders spoke compellingly about the extreme problems faced by countries affected by fragility and conflict, and what can be done. Ngozi Okonjo-Iweala (Managing Director of the World Bank) asked probing questions to the panel of Paul Collier (The Bottom Billion, and Wars, Guns and Votes), Donald Kaberuka (President of the African Development Bank, former Finance Minister of Rwanda), and George Soros (Open Society Institute, Soros Foundation).
I will write a more systematic summary paper later; here I am just trying to capture some memorable points that struck me from the lively discussion and debate.
On the one hand a sense of optimism, that the problems of fragile states can be addressed, the world is much more aware of these problems, and fragility is not a permanent condition, although it will require much more money and greater accountability, as well as strong leadership in the countries themselves.
On the other hand the recognition that helping countries move out of fragility and conflict is a long-term and thankless task, the dynamics of these countries often put them in a downward spiral, and it is essential to take advantage of windows of opportunity when they arise – whether at the end of a conflict or when there is political change (because once the windows are gone they are gone), and then have staying power. Deterioration can occur quickly, whereas rebuilding takes years and decades. Important not to lose hope.
Don’t bypass the state but rather use aid to help these countries build institutions, was a key message of the seminar.
More money for fragile and conflict affected countries (although it is tiny in relation to what has been spent on the global financial and economic crisis) needs to be accompanied by greater accountability. There are promising ideas, some of which have begun to be put into practice, that need to be scaled up and taken farther.
The global economic crisis is producing, amongst others, a divide between experts/technocrats and public opinion. This is a bill of several particulars. First, the question of language. The crisis and the possible policy responses are being discussed in a technical language so abstruse that if you don't have an MBA in finance or a PhD in Economics you are lost. It appears we have a coterie of insiders...and everybody else. This is not good, as I will soon explain.
Second, there is the question of scepticism. Public opinion is skeptical about what the experts really know about what is going on. Are these not the same experts running the global financial system and who drove it off a cliff? And why can they not agree on anything? For every expert who says countries must throw trillions at the problem is another who says do nothing, just tough it out. What are non-specialists to make of this cacophony?