Tackling the #refugee crisis means reforming remittances

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.

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.

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