Asia structurally dependent on labor migration –analysts

PASIG CITY – Analysts claim the movement of workers from home countries in Asia already reached a level wherein their economies are now “structurally dependent” on migration.

Labor migration for Asia is “not a mom-and-pop story anymore,” Ma. Alcestis Mangahas of the International Labor Organization (ILO) told migration analysts and stakeholders at a recent forum here.

Mangahas, ILO senior migration specialist, said the advancement of labor migration to such level occurred independent of the recent global financial crisis, natural disasters, and political strife that hit Asia in the past three years.

“Migration is no longer ad hoc.”

Hence, Mangahas challenged policy forum participants to face migration squarely, something that an Asian Development Bank paper says is the correct attitude.

This is important since the ADB paper authors noted an “Asian advantage” when migration for work is liberalized —whether within Asia or to other regions of the world by 2012.

But the authors of the 2008 paper “Asian Migration Prospects: 2007-2010” warned officials must be clear of what they want.

“What do labor-sending countries want —higher growth in real GDP [gross domestic product] or higher real incomes for their citizenry?” authors Terrie Walmsley and S. Amer Ahmed posited.

If higher growth in real GDP, then the economic gains from liberalizing migration “are not guaranteed and, if they do occur, only do so in the long run once businesses have had a chance to respond by building more factories.”

But if higher real incomes for the citizenry through remittances, Walmsley and Ahmed think that the gains are greatest “when more migrants are sent overseas and more remittances are received”.

Walmsley and Ahmed performed econometric simulations using what they call a general equilibrium model and provided five scenarios of how liberalizing migration benefits both to sending and receiving Asian countries of migrant workers come the year 2012.

The computations show that both sending and receiving countries can benefit from liberalizing migration in terms of real GDP.

If developed Asian economies such as Japan, Korea, Taiwan and Singapore have more skilled and low-skilled migrant workers by 2012, these economies gain in terms of real GDP.

If the migration of Asian migration is headed towards North America, Europe and the Oceania regions, countries such as India, the Philippines and the rest of East Asia would rather send labor to these regions than to within Asia given higher real income gains.

When the scenario is global liberalization of migrant labor, Asian economies lose less unlike the situation when Asian countries send migrant labor to Japan, Korea, Taiwan and Singapore only, the paper said.

If migrant workers from Asia are sent to the Middle East, Walmsley’s and Ahmed’s migrant-sending economies experience declines in real GDP —especially for India and the rest of South Asia which were computed to have the sharpest declines.

And if the liberalization of migration is within the Association of Southeast Asian Nations (Asean), “the countries that benefit most from these gains are those that currently have the largest number of citizens resident in other countries, most notably Malaysia, which is the home of 67% of migrants in Asean.”

Walmsley’s and Ahmed‘s paper shows that Malaysia “gains by far the most in terms of real GDP and income, followed by Singapore, the Philippines, and Indonesia.”

If working conditions of migrant workers within Asean improve, coupled with legalizing irregular migrant workers, such migration-related efforts by Asean countries “could offer a beneficial alternative.”

In all 5 scenarios presented by Walmsley and Ahmed, both India and the Philippines benefitted in terms of seeing many people having increased real incomes due to their remittances.

As well, skilled migrant workers are more productive in these 5 scenarios compared to low-skilled migrant workers.

Permanence

In view of such scenarios, Mangahas noted that Asian countries that have endured various economic impacts of either a natural or a man-made crisis reflect their “need” for labor migration.

Thus, this phenomenon is “no longer temporary.”

“If the situation is going to be [such], we [Asian countries] must make a decision to like this temporary migration program or not.”

Yet Mangahas thinks it will take time for receiving Asian countries to totally eliminate their need for foreign labor.

Thus, it pays that Asian countries address problems usually associated with migration, Mangahas said, such as: irregular migration, the cycle of debt facing migrant workers, the overseas contracts that migrant workers sign prior to departure and are dishonoured in host countries, and the sentiment of the public in receiving countries towards migrants.

“We must go back then to the fundamentals: Do Asian countries take migration seriously? Is it [recognized as] a labor market issue, as well as a human rights issue?”

While Walmsley and Ahmed have proven the benefits of migration to Filipino migrant workers and their Indian counterparts, labor migration for origin countries like the Philippines remains temporary even as the government achieved increasing numbers in the deployment of overseas workers in 2009.

The rising deployment was spurred in part by administrative orders by outgoing President Gloria Arroyo pressuring the Philippine Overseas Employment Administration (POEA) to accelerate finding new job markets for overseas Filipino workers given the crisis.

One is AO 247 ordering the POEA to go full blast in finding more overseas job opportunities.

But Dr. Maruja Asis of the Quezon City-headquartered Scalabrini Migration Center thinks AO 247 “violates” a provision of Republic Act 8042, where the state does not promote overseas employment as a strategy for economic development.

But Mangahas, noticing how the global economic crisis staved off a negative impact unto overseas Filipinos and their billion-dollar remittances, thinks that market promotion by origin countries for overseas jobs is “worth evaluating”.

Market promotion is also sending countries “good, strong political statements in filling up employment,” Mangahas added.

“The reality is that if theory thinks that labor migration will go away, it does not happen that way. Thus, Asian countries [sending and receiving migrant workers] should face and confront the problem.”

Malaysia appears to have been doing so, according to analyst Vijayakumari Kanapathy.

She said that Malaysia plans to lessen its dependency on foreign labor in the next 3 years.

The ADB paper thinks that policies by Asian countries related to liberalizing labor migration “offer potential gains in terms of real income and long-run economic growth, particularly for those countries in East and Southeast Asia”. OFW Journalism Consortium