Migration and Development

27 June 2008Geneva

Denis DrechslerOECD Development Centre

More Coherence for Better Outcomes

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Overview of the Presentation

1. What do we think we know?

2. What do empirics say?

3. What can we do?

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Two Main Messages

The good news: Migration can contribute to development and poverty reduction

The (potentially) inconvenient news:Development and development aid will not stop migration flows.

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What do we think we know?

• International migration is exploding

• Most migrants to OECD countries come from poor regions

• The loss of human capital (brain drain) reduces countries’ development prospects

• Financial returns by migrants (remittances) replace development aid

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What do empirics say?

Source: United Nations Population Division.

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Effects on Sending Regions

• Migration of low-skilled workers– Higher financial returns

– Larger impact on poverty reduction

– Potential improvements in low-wage sector

– Increase of productivity

• Migration of the highly skilled– Possible knowledge transfer

– Incentive to invest in human capital

– Potentially a win-win situation

– However: particularly problematic in poor developing countries

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Migration of University Graduates (in %)

Source: OECD Database on Expatriates and Immigrants, 2004/2005; Cohen and Soto

(2001)

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Remittances are important…

Source: IMF Current Accounts; UN Trends in Migrant Stock, 2000.

Annual transfer of a migrant, in USD (2000)

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Quelle: Fomin, Pew Hispanic Center

78.0

7.0 5.0 4.0 1.0

Cons. Educ. Saving Other Invest.

…and mostly go into consumption

Use of remittances, Mexico 2000 (in %)

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Summing up

• Migration is an integral part of globalisation

• International mobility can be expected to increase with development

• Development potential of migration is currently insufficiently utilised

• Need for partnerships and more coherent policies

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What can we do?

• Donors– Introduce more flexibility: towards circular

migration– Improve guidelines for recruitment of the highly

skilled– Initiate concerted actions with banks and other

financial institutes to reduce transfer costs of remittances

• Partner Countries– Integrate migration into development strategies– Improve human resource management to

compensate the consequences of migration– Invest in transport and communication

infrastructure to increase mobility of workers

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For more information: www.oecd.org/dev/migration