How Diasporas Can Help The
Sam Vaknin, Ph.D.
The following steps are considered to be the "minimum
package" in the strengthening of relationships between
countries of origin and national diasporas:
1. The granting to the diaspora of unlimited or, at
the very least, restricted voting rights in the Motherland
2. The institutionalized involvement of political structures
representing the diaspora in the politics of the Motherland
(e.g., Israel) and vice versa (for instance, the Jewish
Congress and the Jewish Agency).
3. Holding common sports events (e.g., the Maccabia
or Maccabead Games as a Jewish Olympiad with participants
from all over the world); the exchange and transfer
of students and professionals between the diaspora and
4. The establishment of a fund for the purchase of
land, the restoration of national treasures to the Motherland,
reforestation and preservation of nationally or historically
significant sites (e.g., the Jewish Keren Hayesod and
Keren Kayemet le-Israel)
5. The solicitation of donations, scholarships, and
sponsorships from wealthy individuals in the diaspora
6. Emphasis on cultural activities and the promotion
of the national language (e.g., various Francophone
activities by France)
7. Selling bonds and stocks exclusively to the diaspora
(e.g., the Israeli Bonds) and the creation of various
investment funds and vehicles to encourage greater economic
involvement of the diaspora in the Motherland.
8. Leveraging the nation's common history, religious
affiliation, and cultural roots to further national
cohesion and political lobbying and support.
9. Encouraging remittances with the implementation
of a special, lenient tax regime, the issuance of remittance-bonds,
and by providing foreign investors with tax holidays,
one-stop-shop facilities, business incubators, and direct
access to decision makers.
10. Fostering knowledge-based networks of local and
foreign (diaspora-based exapts) businessmen, scientists,
and experts; forming migrant associations to share contacts
and business opportunities and otherwise socially network;
encouraging returning citizens and providing them with
tax concessions, loans, and employment opportunities
(e.g., Israel, China, Venezuela, Uruguay, Ethiopia).
Barry Chiswick and Timothy Hatton demonstrated ("International
Migration and the Integration of Labour Markets", published
by the NBER in its "Globalisation in Historical Perspective")
that, as the economies of poor countries improve, emigration
increases because people become sufficiently wealthy
to finance the trip.
Poorer countries invest an average of $50,000 of their
painfully scarce resources in every university graduate
- only to witness most of them emigrate to richer places.
The haves-not thus end up subsidizing the haves by exporting
their human capital, the prospective members of their
dwindling elites, and the taxes they would have paid
had they stayed put. The formation of a middle class
is often irreversibly hindered by an all-pervasive brain
Politicians in some countries decry this trend and
deride those emigrating. In a famous interview on state
TV, the late prime minister of Israel, Yitzhak Rabin,
described them as "a fallout of the jaded". But in many
impoverished countries, local kleptocracies welcome
the brain drain as it also drains the country of potential
Emigration also tends to decrease competitiveness.
It increase salaries at home by reducing supply in the
labour market (and reduces salaries at the receiving
end, especially for unskilled workers). Illegal migration
has an even stronger downward effect on wages in the
recipient country - illegal aliens tend to earn less
than their legal compatriots. The countries of origin,
whose intellectual elites are depleted by the brain
drain, are often forced to resort to hiring (expensive)
foreigners. African countries spend more than $4 billion
annually on foreign experts, managers, scientists, programmers,
Still, remittances by immigrants to their relatives
back home constitute up to 10% of the GDP of certain
countries - and up to 40% of national foreign exchange
revenues. The World Bank estimates that Latin American
and Caribbean nationals received $15 billion in remittances
in 2000 - ten times the 1980 figure. This may well be
a gross underestimate. Mexicans alone remitted $6.7
billion in the first 9 months of 2001 (though job losses
and reduced hours may have since adversely affected
remittances). The IADB thinks that remittances will
total $300 billion in the next decade (Latin American
immigrants send home c. 15% of their wages).
Official remittances (many go through unmonitored money
transfer channels, such as the Asian Hawala network)
are larger than all foreign aid combined. "The Economist"
calculates that workers' remittances in Latin America
and the Caribbean are three times as large as aggregate
foreign aid and larger than export proceeds. Yet, this
pecuniary flood is mostly used to finance the consumption
of basics: staple foods, shelter, maintenance, clothing.
It is non-productive capital.
Only a tiny part of the money ends up as investment.
Countries - from Mexico to Israel, and from Macedonia
to Guatemala - are trying to tap into the considerable
wealth of their diasporas by issuing remittance-bonds,
by offering tax holidays, one-stop-shop facilities,
business incubators, and direct access to decision makers
- as well as matching investment funds.
Migrant associations are sprouting all over the Western
world, often at the behest of municipal authorities
back home. The UNDP, the International Organization
of Migration (IOM), as well as many governments (e.g.,
Israel, China, Venezuela, Uruguay, Ethiopia), encourage
expatriates to share their skills with their counterparts
in their country of origin. The thriving hi-tech industries
in Israel, India, Ireland, Taiwan, and South Korea were
founded by returning migrants who brought with them
not only capital to invest and contacts - but also entrepreneurial
skills and cutting edge technologies.
Thailand established in 1997, within the National Science
and Technology Development Agency, a 2.2 billion baht
project called "Reverse the Brain Drain". Its aim is
to "use the 'brain' and 'connections' of Thai professionals
living overseas to help in the Development of Thailand,
particularly in science and technology."
The OECD ("International Mobility of the Highly Skilled")
believes that: "More and more highly skilled workers
are moving abroad for jobs, encouraging innovation to
circulate and helping to boost economic growth around
But it admits that a "greater co-operation between
sending and receiving countries is needed to ensure
a fair distribution of benefits".
The OECD noted, in its "Annual Trends in International
Migration, 2001" that (to quote its press release):
"Fears of a "brain drain" from developing to technologically
advanced countries may be exaggerated, given that many
professionals do eventually return to their country
of origin. To avoid the loss of highly qualified workers,
however, developing countries need to build their own
innovation and research facilities ... China, for example,
has recently launched a program aimed at developing
100 selected universities into world-class research
centers. Another way to ensure return ... could be to
encourage students to study abroad while making study
grants conditional on the student's return home."
The key to a pacific and prosperous future lies in
a multilateral agreement between brain-exporting, brain-importing,
and transit countries. Such an agreement should facilitate
the sharing of the benefits accruing from migration
and "brain exchange" among host countries, countries
of origin, and transit countries. In the absence of
such a legal instrument, resentment among poorer nations
is likely to grow even as the mushrooming needs of richer
nations lead them to snatch more and more brains from
their already woefully depleted sources.
Immigrants and the Fallacy of Labour Scarcity
The Labour Divide - II. Migration and Brain Drain
Sam Vaknin is the author of Malignant Self Love
- Narcissism Revisited and After the Rain - How the
West Lost the East. He served as a columnist for Global
Politician, Central Europe Review, PopMatters, Bellaonline,
and eBookWeb, a United Press International (UPI) Senior
Business Correspondent, and the editor of mental health
and Central East Europe categories in The Open Directory
Mr Vaknin's web site is at http://samvak.tripod.com