# CE2004078EN.01003401.xml

| 27.3.2004 | EN | Official Journal of the European Union | CE 78/34 |
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27.3.2004

EN

Official Journal of the European Union

CE 78/34

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(2004/C 78 E/0034)

WRITTEN QUESTION E-1435/03

by Erik Meijer (GUE/NGL) to the Commission

(24 April 2003)

Subject:   Increasing Third World dependence on emigration to work in rich countries and earnings transfers from rich countries

Subject:

| 1. | Is the Commission aware of the World Bank report of 2 April 2003, entitled ‘Global Development Finance’, which describes migrant workers who send part of their earnings obtained in countries with highly developed economies to members of their families who have stayed on in the Third World, or invest in such countries in some other way, as having now become an indispensable source of funding for developing countries that also creates more stability than the customary loans? |
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1.

Is the Commission aware of the World Bank report of 2 April 2003, entitled ‘Global Development Finance’, which describes migrant workers who send part of their earnings obtained in countries with highly developed economies to members of their families who have stayed on in the Third World, or invest in such countries in some other way, as having now become an indispensable source of funding for developing countries that also creates more stability than the customary loans?

| 2. | Is the Commission aware that this source of funding concerns very considerable sums, and that the total amount originating in all rich countries taken together rose from EUR 64,5 thousand million in 2000 to EUR 74 thousand million in 2002, and that the amounts from EU Member States for the year 2002, in thousand million US dollars, break down as follows: Germany 8,2; Belgium, 8,1; France, 3,9; Luxembourg, 3,1; Italy, 2,6; Spain, 2,2; the Netherlands, 1,5; and the United Kingdom, 1,3? |
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2.

Is the Commission aware that this source of funding concerns very considerable sums, and that the total amount originating in all rich countries taken together rose from EUR 64,5 thousand million in 2000 to EUR 74 thousand million in 2002, and that the amounts from EU Member States for the year 2002, in thousand million US dollars, break down as follows: Germany 8,2; Belgium, 8,1; France, 3,9; Luxembourg, 3,1; Italy, 2,6; Spain, 2,2; the Netherlands, 1,5; and the United Kingdom, 1,3?

| 3. | How does the Commission view the conclusion by World Bank researcher Dilip Ratha, that more migration is likely to provide the world with great advantages and that rich countries must therefore make international migration easier? Is this view compatible, in the Commission's judgement, with the problems of pressure on living space and possible confrontations between social groups with different cultures, and with the EU Member States' tendency only to admit a limited number of economic migrants who are able to supply needs that cannot be met, or can be met only partly, by their own inhabitants? |
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3.

How does the Commission view the conclusion by World Bank researcher Dilip Ratha, that more migration is likely to provide the world with great advantages and that rich countries must therefore make international migration easier? Is this view compatible, in the Commission's judgement, with the problems of pressure on living space and possible confrontations between social groups with different cultures, and with the EU Member States' tendency only to admit a limited number of economic migrants who are able to supply needs that cannot be met, or can be met only partly, by their own inhabitants?

| 4. | In what way can the EU help to ensure that Third World countries become not more, but less, dependent on earnings obtained by working in Europe, for instance by directly ensuring that economic growth increasingly occurs elsewhere in the world, rather than encouraging it in the EU and subsequently investing the profits from it elsewhere? |
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4.

In what way can the EU help to ensure that Third World countries become not more, but less, dependent on earnings obtained by working in Europe, for instance by directly ensuring that economic growth increasingly occurs elsewhere in the world, rather than encouraging it in the EU and subsequently investing the profits from it elsewhere?

Source: Dutch newspaper ‘De Volkskrant’ 3.4.2003.

Answer given by Mr Nielson on behalf of the Commission

(19 June 2003)

(19 June 2003)

| 1. | Yes, the Commission is aware of the World Bank report referred to. It contains a chapter entitled ‘Workers’ Remittances: an important and stable source of external development finance', by World Bank researcher Dilip Ratha. |
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1.

Yes, the Commission is aware of the World Bank report referred to. It contains a chapter entitled ‘Workers’ Remittances: an important and stable source of external development finance', by World Bank researcher Dilip Ratha.

| 2. | The Commission has noted that these figures are mentioned in the report. |
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2.

The Commission has noted that these figures are mentioned in the report.

| 3. | The report says that ‘facilitating labor mobility between source and destination countries is perhaps the most crucial — and controversial — means of increasing remittance flows to developing countries’. This may be true, but this is not, in the view of the Commission in itself a reason to favour an increase of international labour mobility. Seen from the perspective of developing countries, international migration may lead to negative ‘brain drain’ phenomena, as it is already the case in several sectors and regions (e.g. the medical profession in African countries). While the net effect for developing countries does not need to be negative as output losses from the migration of skilled workers are to some extent offset by gains from remittances and network effects (business contacts, investments, technological help, support to education, etc.), migration needs to be managed very carefully. There are well known domestic reasons for the Union not to opt for a fully liberalised international labour market. Its migration policy is and will continue to be based on the concept of migration management, which allows, inter alia, for the creation of synergies between development and migration policy objectives.
  On the specific subject of migrants' remittances, one of the aspects where — e.g. in the context of development cooperation — meaningful support may be given is to make the transfer of remittances cheaper and more reliable. The report mentions the fact that the cost of transferring remittances often exceeds 20 %. Reducing such costs to less than 10 % would — according to the report — imply an annual saving of EUR 3,5 billion to migrant workers. |
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3.

The report says that ‘facilitating labor mobility between source and destination countries is perhaps the most crucial — and controversial — means of increasing remittance flows to developing countries’. This may be true, but this is not, in the view of the Commission in itself a reason to favour an increase of international labour mobility. Seen from the perspective of developing countries, international migration may lead to negative ‘brain drain’ phenomena, as it is already the case in several sectors and regions (e.g. the medical profession in African countries). While the net effect for developing countries does not need to be negative as output losses from the migration of skilled workers are to some extent offset by gains from remittances and network effects (business contacts, investments, technological help, support to education, etc.), migration needs to be managed very carefully. There are well known domestic reasons for the Union not to opt for a fully liberalised international labour market. Its migration policy is and will continue to be based on the concept of migration management, which allows, inter alia, for the creation of synergies between development and migration policy objectives.

On the specific subject of migrants' remittances, one of the aspects where — e.g. in the context of development cooperation — meaningful support may be given is to make the transfer of remittances cheaper and more reliable. The report mentions the fact that the cost of transferring remittances often exceeds 20 %. Reducing such costs to less than 10 % would — according to the report — imply an annual saving of EUR 3,5 billion to migrant workers.

| 4. | The promotion of high and sustainable growth within developing countries themselves is one of the priorities of the Union's external policy and is supported through a variety of financial and technical assistance instruments world-wide. In its recent Communication on ‘Integrating migration issues in the EU's relations with third countries’ (1) the Commission has proposed several relevant policies, including ‘the improvement of effective market access of developing countries’ products into the EU','the enhancement of south-south trade', ‘the promotion of foreign direct investments into developing countries’, ‘the promotion of outsourcing arrangements between developed and developing countries’ (notably in the information technology and research and Technological development sectors), ‘the facilitation of migrants’ efforts to contribute to the economic and social development in their countries of origin (without permanently returning to it), etc. Workers' remittances can contribute to higher and more stable growth in recipients' countries, as supported by the fact that remittances are increasingly used for investment purposes. |
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4.

The promotion of high and sustainable growth within developing countries themselves is one of the priorities of the Union's external policy and is supported through a variety of financial and technical assistance instruments world-wide. In its recent Communication on ‘Integrating migration issues in the EU's relations with third countries’ (1) the Commission has proposed several relevant policies, including ‘the improvement of effective market access of developing countries’ products into the EU','the enhancement of south-south trade', ‘the promotion of foreign direct investments into developing countries’, ‘the promotion of outsourcing arrangements between developed and developing countries’ (notably in the information technology and research and Technological development sectors), ‘the facilitation of migrants’ efforts to contribute to the economic and social development in their countries of origin (without permanently returning to it), etc. Workers' remittances can contribute to higher and more stable growth in recipients' countries, as supported by the fact that remittances are increasingly used for investment purposes.

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(1)  COM(2002) 703 final.

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