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Tackling the #refugee crisis means reforming remittances

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Pressure is mounting in Italy, one of the main gateways for migrants to Europe, after the latest G7 meeting in Taormina, Sicily utterly failed to be the turning point in the debate over the migrant crisis that Rome had hoped it would be.  Donald Trump – who else – refused to acknowledge the urgency of the crisis and blocked his host’s wide-ranging plan for a positive statement defending refugees’ rights.

As a result, Italy – and its Mediterranean neighbours – were left with no solid outcome on how to deal with the migrant crisis. As violence in Libya peaks, Rome has seen a 44% surge in the number of asylum seekers arriving in southern Italy compared with the same period last year. What’s worse, the failure of the G7 meeting, coming on the back of so many other failed summits, just gives credence to the notion that the West is incapable, or unwilling, to address the biggest humanitarian crisis of this generation.

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Make no mistake; solutions are readily available for anyone asking. In comments last month before EU lawmakers at the European Parliament’s plenary in Strasbourg, African Union Commission President Moussa Faki Mahamat gave a sense of what direction Europe should take to address the migrant crisis. “The issue of migration cannot be solved just by dealing with the consequences rather than addressing the causes,” he said. “It is a deeper problem… by sending people away, building camps, building barriers, we will never solve these problems.” As he says, it’s time for Europe to stop trying to plug the dam, and address the cause of the leak in the first place. Other than devoting more money to development assistance and engaging in peacekeeping operations in regions wracked by conflict – which are time intensive objectives – a straightforward quick fix would be reforming the remittances market.

So far, the EU has mostly focused on throwing money at the problem, achieving weak results along the way. Indeed, Brussels has deployed development funding with one eye on what this means for the number of migrants on European shores. Despite the fact that the EU’s Lisbon Treaty states, “Development cooperation policy shall have as its primary objective the reduction and, in the long term, the eradication of poverty,” Brussels has been increasingly using development aid resources, such as the Emergency Trust Fund for Africa, to contain people in “migrant producing countries” rather than investing in economic development, empowerment, and education programs that could help them. Meanwhile, non-migrant producing countries have seen their funding slashed. Of course, in the long term, this is likely to stimulate more, not less, economic migration. In other ways, Brussels has been even more explicit about its desire to divert, not assist, potential migrants. For instance, the EU has been using financial inducements to “encourage” African nations to stem the human tides passing through their nations and take back their citizens when they are deported from Europe. German Vice Chancellor Sigmar Gabriel summed it up when he said, “Those who do not co-operate sufficiently cannot hope to benefit from our development aid.”

Small steps make big differences

Rather than enacting such draconian strategies, Europe should explore other solutions that can help empower Africa’s economically disadvantaged. As the Valletta Summit on Migration acknowledged, even something as simple as reforming regulations to tackle unnecessarily high remittance fees could make a big difference. After all, for many Africans, remittances represent a significant source of income. In Liberia, for instance, money sent from relatives abroad accounts for 26% of GDP. In total, yearly remittances to sub-Saharan Africa are estimated to reach more than $30 billion. Unfortunately, Africans overseas invariably send this money by Western Union or MoneyGram – the market leaders, which are also rumoured to be in merger talks – end up paying twice as much their Southeast Asian or Latin American counterparts. According to the World Bank, the fees are currently funnelled into corporate coffers could “contribute significantly to improving the living conditions of the migrants themselves, as well as reducing poverty in their countries of origin.” As Kevin Watkins, executive director of the Overseas Development Institute, puts it, it is “honestly one of the greatest financial outrages of our time.”

 

Of course, this is an issue that has largely only impacted Africans until now, so there has been scant international appetite for change. Now that it has become clear that high remittance fees were one part of the migrant jigsaw, Europe enacted a 15-year goal to curb fees to below 3%. The move was a good first step towards addressing the continent’s concerns that curbing migration would stop a stable source of income for impoverished Africans. But this is far too little, too late.

 

Sadly, when Europe’s biggest annual summit on development cooperation took place last week – the European Development Days (EDD) – EU leaders signed off on a controversial declaration that only reaffirms the bloc’s strategy of prioritizing the same political objectives laid out at the G7 summit over development goals. However, if we are to solve the migration crisis we need less of the stick shooing people away from the continent’s shores, and more of the carrots that will give them reason to stay home in the first place.

 

Employment

Only 5% of total applications for long-term skilled work visas submitted in first quarter came from EU citizens, data shows

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The figures released by the UK Home Office give an indication of how Britain’s new post-Brexit immigration system will affect numbers of EU citizens coming to the UK to work. Between January 1 and March 31 this year EU citizens made 1,075 applications for long-term skilled work visas, including the health and care visa, which was just 5% of the total 20,738 applications for these visas.

The Migration Observatory at the University of Oxford said: “It is still too early to say what impact the post-Brexit immigration system will have on the numbers and characteristics of people coming to live or work in the UK. So far, applications from EU citizens under the new system have been very low and represent just a few percent of total demand for UK visas. However, it may take some time for potential applicants or their employers to become familiar with the new system and its requirements.”

The data also shows that the number of migrant healthcare workers coming to work in the UK has risen to record levels. 11,171 certificates of sponsorship were used for health and social care workers during the first quarter of this year. Each certificate equates to a migrant worker. At the start of 2018, there were 3,370. Nearly 40 percent of all skilled work visa applications were for people in the health and social work sector. There are now more migrant healthcare visa holders in the UK than at any time since records began in 2010. Although the number of sponsor licences for healthcare visas dropped to 280 during the first lockdown last year, it has continued to rise since, a pattern which was unaffected by the third lockdown this winter.

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Conversely, the IT, education, finance, insurance, professional, scientific and technical sectors have all seen a drop in the number of migrants employed so far this year, despite rallying during the second half of 2020. The number of migrant IT workers is still significantly lower than pre-Covid levels. In the first quarter of 2020 there were 8,066 skilled work visas issued in the IT sector, there are currently 3,720. The number of migrant professionals and scientific and technical workers has also dipped slightly below pre-Covid levels.

Visa expert Yash Dubal, Director of A Y & J Solicitors said: “The data shows that the pandemic is still affecting the movement of people coming to the UK to work but does give an indication that demand for skilled work visas for workers outside the EU will continue to grow once travel has been normalised. There is particular interest in British IT jobs from workers in India now and we expect to see this pattern continue.”

Meanwhile the Home Office has published a commitment to enable the legitimate movement of people and goods to support economic prosperity, while tackling illegal migration. As part of its Outcome Delivery Plan for this year the department also pledges to ‘seize EU exit opportunities, through creating the world’s most effective border to increase UK prosperity and enhance security’, while acknowledging that income it collects from visa fees may decrease due to reduced demand.

The document reiterates the Government’s plan to attract the "brightest and best to the UK".

Dubal said: “While the figures relating to visas for IT workers and those in the scientific and technical sectors do not bear this commitment out, it is still early days for the new immigration system and the pandemic has had a profound effect on international travel. From our experience helping facilitate work visas for migrants there is a pent-up demand that will be realised over the coming 18 months.”

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Economy

NextGenerationEU: Four more national plans given thumbs up

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Economy and finance ministers today (26 July) welcomed the positive assessment of national recovery and resilience plans for Croatia, Cyprus, Lithuania and Slovenia. The Council will adopt its implementing decisions on the approval of these plans by written procedure.

In addition to the decision on 12 national plans adopted earlier in July, this takes the total number to 16. 

Slovenia’s Finance Minister Andrej Šircelj said: “The Recovery and Resilience Facility is the EU’s programme of large-scale financial support in response to the challenges the pandemic has posed to the European economy. The facility’s €672.5 billion will be used to support the reforms and investments outlined in the member states’ recovery and resilience plans.”

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Reforms and investments

The plans have to comply with the 2019 and 2020 country-specific recommendations and reflect the EU’s general objective of creating a greener, more digital and more competitive economy.

Croatia plans to implement to reach these goals include improving water and waste management, a shift to sustainable mobility and financing digital infrastructures in remote rural areas. 

Cyprus intends, among other things, to reform its electricity market and facilitate the deployment of renewable energy, as well as to enhance connectivity and e-government solutions.

Lithuania will use the funds to increase locally produced renewables, green public procurement measures and further developing of the rollout of very high capacity networks.

Slovenia plans to use a part of the allocated EU support to invest in sustainable transport, unlock the potential of renewable energy sources and further digitalise its public sector.

Poland and Hungary

Asked about delays to the programmes of Poland and Hungary, the EU’s Economy Executive Vice President Valdis Dombrovskis said that the Commission had proposed an extension for Hungary to the end of September. On Poland, he said that the Polish government had already requested an extension, but that that might need a further extension. 

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Economy

EU extends scope of general exemption for public aid for projects

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Today (23 July) the Commission adopted an extension of the scope of the General Block Exemption Regulation (GBER), which will allow EU countries to implement projects managed under the new financial framework (2021 - 2027), and measures that support the digital and green transition without prior notification.

Executive Vice President Margrethe Vestager said: “The Commission is streamlining the state aid rules applicable to national funding that fall under the scope of certain EU programmes. This will improve further the interplay between EU funding rules and EU state aid rules under the new financing period. We are also introducing more possibilities for member states to provide state aid to support the twin transition to a green and digital economy  without the need of a prior notification procedure.”

The Commission argues that this will not cause undue distortions to competition in the Single Market, while making it easier to get projects up and running.  

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The concerned national funds are those relating to: Financing and investment operations supported by the InvestEU Fund; research, development and innovation (RD&I) projects having received a “Seal of Excellence” under Horizon 2020 or Horizon Europe, as well as co-funded research and development projects or Teaming actions under Horizon 2020 or Horizon Europe; European Territorial Cooperation (ETC) projects, also known as Interreg.

Projects categories that are considered to help the green and digital transition are: Aid for energy efficiency projects in buildings; aid for recharging and refuelling infrastructure for low emission road vehicles; aid for fixed broadband networks, 4G and 5G mobile networks, certain trans-European digital connectivity infrastructure projects and certain vouchers.

In addition to the extension of the scope of the GBER adopted today, the Commission has already launched a new revision of the GBER aimed at streamlining state aid rules further in light of the Commission priorities in relation to the twin transition. Member states and stakeholders will be consulted in due course on the draft text of that new amendment.

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