Why the success of Ukraine's economy depends on the Ukrainian migrants
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Why the success of Ukraine's economy depends on the Ukrainian migrants
18.12.2014
Why the success of Ukraine's economy depends on the Ukrainian migrants
December 18 - International Migrants Day. On this day, many countries are trying to thank these people. After all, including due to the economies of these countries they have made substantial progress. But in the Slavic countries dominated by neutral or negative attitudes towards migrants. Let's try to dispel these doubts and prejudices. Indeed, while some countries are skeptical of migrants, while others use their enormous potential and make their economies more competitive.
Over the past decade, the role of migrants in the world has grown substantially. According to the World Bank, they annually earn about $ 2.6 trillion, which puts migration economy to sixth place in the world - the UK before and after the French economy. About $ 0.5 trillion migrants accumulate in various forms of assets abroad, another $ 0.6 trillion sent home through the financial and banking system. Influence and income of migrants grow so fast that Forbes has devoted his own rating, which comes from the Ukraine Kum Yang with assets of $ 6.9 billion was ninth.
Realizing the potential of migrants, countries are increasingly attracted to them or, on the contrary, is sent to work abroad. More developed countries are beginning to provide incentives to attract them (to take advantage of their intellectual and labor potential), less developed - are sent to these citizens subsequently returned to a specific earnings (capital), knowledge and connections.
Over the last 23 years, many developed countries have doubled the number of immigrants. In the US, the number reached nearly 46 million, or about 15% of the employed population. And the United States continues a policy of attracting immigrants - the authorities are aware of the phenomenal role in the success of American expats. For example, in 2011, of the largest Fortune 500 companies around 40% were founded by immigrants. These companies in 2010 earned $ 1.7 trillion.
Proctor & Gamble, Pfizer, EBay, Google and many others created by foreign migrants, PayPal and What's Up - migrants from Ukraine. In most of these, and other, especially IT-companies, from 10 to 50% of employees - immigrants or members of someone's diaspora.
Many studies show that the efficiency and productivity of foreign migrants is much higher than that of the indigenous population. Individual countries such as the United Arab Emirates, Singapore, Canada, Qatar, held, largely due to immigrants. Note sixfold increase in their number in the UAE in 23 years. Is Emirates would be held as a successful economy without migrants? In this country, they already account for 87% of the population. Forbes wrote that the UAE is now shifting from quantity to quality selection of immigrants and are ready to provide them with international standards of accommodation in order to maintain the success of their country.
In Russia, it would seem interesting country for migrants from all over the CIS, it turns out, there is no growth in their number. And popular in Russia, the phrase "come in large numbers here" lost relevance. Just in the country has changed the composition of migrants. If earlier it was the Ukrainians, Belorussians, Baltic states, now - migrants from Central Asia, people with darker (ie more prominent) skin color.
Many studies show that the efficiency and productivity of foreign migrants is much higher than that of the indigenous population. Individual countries such as the United Arab Emirates, Singapore, Canada, Qatar, held, largely due to immigrants.
So perhaps the problem neighboring economy is effectively connected with the inability or unwillingness to effectively manage the immigration process? Compare Russia and Canada. 2015 Russia announced readiness to issue only 126,000 permits for long stay of migrants (with a population of 146 million people.), And Canada - nearly 300 000 (out of a population of 35 million people.). The question arises: what kind of economy will be more effective? It is logical to assume that because of immigrants made their work at a lower cost the Canadian economy will outperform the Russian. In Canada, the policy towards immigrants is a priority. There are more than 60 programs to attract and integrate immigrants. Annually under the patronage of the largest bank Royal Bank of Canada published the rating "Top 25 best immigrants", and the participants will be awarded.
Developing countries, on the contrary, the possibility of realizing their people to acquire new knowledge and experience, establish new contacts and make start-up capital, stimulate (no limit) his emigration. 23 years even the largest developing countries have doubled the number of its immigrants.
These countries receive a return positive effect. For example, India receives more than $ 70 billion in remittances per year, China - more than $ 60 billion, Mexico - more than $ 20 billion. These migrants do not forget about their countries and put them in huge funds, including in the form of direct investment. According to the McKinsey Institute, from $ 100-120 billion of direct investment coming into China every year, about $ 50 billion - this means Chinese migrant businessmen.
The lack of positive dynamics of growth in the number of migrants noticeable in Ukraine and Russia. With regard to the Russian Federation, it becomes obvious that in the near future, it is strongly lag behind the other countries of the BRICS group. Unwillingness to recognize and cooperate productively with their migrants will be a key factor in the backlog. Russia already the smallest ratio of transfers to income Russian migrants - only 6%. In China - 27%, in India - 34%.
Ukraine special attention to its migrants who already has 5 million, and does not pay. On International Migrants Day is not planned large-scale events with the participation of the country's leadership, financial and banking sector in order to thanks for their contribution to the economy of Ukraine. And he's really important - it is expected that in 2014, remittances amount to more than $ 7 billion, or almost 8% of GDP, and with the transfer unregistered channels - about $ 25 billion, or 20% of GDP. Translations have become a major source of foreign exchange inflows (after export earnings). But until there is attention to migrants - there will be no result: translations do not improve the situation with the balance of payments do not increase the foreign exchange reserves, do not contribute to the development of SMEs, etc.
Therefore, Ukraine's time to reconsider the strategy of working with foreign capital, by adopting the best practices for attracting remittances to the country's economy. Here it is necessary to give an example of the Philippines. In this country, special attention is given to Filipino migrants not only on 18 December and the entire month of December. On a daily basis during the month of Filipinos all foreign governments, banks, social services have the honor due to migrants and their households for the financial and material support, they provide home country. The key event - handing Philippine President awards and letters thanks to migrants made in the current year, the largest contribution to the development of the country.
As a result, only through financial and banking system of the Philippines receive more than $ 25 billion a year. Through the development of financial and banking, insurance, transportation volumes transfers are growing rapidly. It is through remittances Philippines have created a stable economy with a surplus balance of payments. Over the course of 2004-2013, the Philippine peso has appreciated by almost 25%. In the global crisis in 2009, when almost all national currencies declined against the US dollar, the Philippine currency has strengthened by 5%.
It is interesting to compare key indicators of the economy of Ukraine and the Philippines. At a much lower specific potential of the economy (GDP per capita), much smaller amounts of accumulated direct investment, foreign trade deficit balance the Philippines, in contrast to Ukraine, been able to accumulate foreign reserves eight times, and the debt dial half. The success of the economy of the Philippines is directly related to migrants and their remittances home.
Ukraine needs to radically change the attitude towards migrants - because of them really depends on the success of our economy. If the authorities want to make a balance of payments surplus, increase foreign exchange reserves and strengthen the national currency, they should not be given to migrants day, month, and all of 2015. Throughout the year, the central and regional authorities should be up and running long-term cooperation program with migrants, and the financial and banking sector - to develop programs and services to promote the translation of official channels. In addition, the efficiency of cooperation with the IMF, World Bank, EBRD may be much higher if we involve them in the implementation of the strategy of cooperation with migrants. These organizations have a lot of experience "start" of translation in economies of different regions of the world.
Implementation of the above proposals would allow Ukraine already in 2016 to receive $ 10 billion, and in 2017 - $ 15 billion in remittances through the financial and banking system.
Over the past decade, the role of migrants in the world has grown substantially. According to the World Bank, they annually earn about $ 2.6 trillion, which puts migration economy to sixth place in the world - the UK before and after the French economy. About $ 0.5 trillion migrants accumulate in various forms of assets abroad, another $ 0.6 trillion sent home through the financial and banking system. Influence and income of migrants grow so fast that Forbes has devoted his own rating, which comes from the Ukraine Kum Yang with assets of $ 6.9 billion was ninth.
Realizing the potential of migrants, countries are increasingly attracted to them or, on the contrary, is sent to work abroad. More developed countries are beginning to provide incentives to attract them (to take advantage of their intellectual and labor potential), less developed - are sent to these citizens subsequently returned to a specific earnings (capital), knowledge and connections.
Over the last 23 years, many developed countries have doubled the number of immigrants. In the US, the number reached nearly 46 million, or about 15% of the employed population. And the United States continues a policy of attracting immigrants - the authorities are aware of the phenomenal role in the success of American expats. For example, in 2011, of the largest Fortune 500 companies around 40% were founded by immigrants. These companies in 2010 earned $ 1.7 trillion.
Proctor & Gamble, Pfizer, EBay, Google and many others created by foreign migrants, PayPal and What's Up - migrants from Ukraine. In most of these, and other, especially IT-companies, from 10 to 50% of employees - immigrants or members of someone's diaspora.
Many studies show that the efficiency and productivity of foreign migrants is much higher than that of the indigenous population. Individual countries such as the United Arab Emirates, Singapore, Canada, Qatar, held, largely due to immigrants. Note sixfold increase in their number in the UAE in 23 years. Is Emirates would be held as a successful economy without migrants? In this country, they already account for 87% of the population. Forbes wrote that the UAE is now shifting from quantity to quality selection of immigrants and are ready to provide them with international standards of accommodation in order to maintain the success of their country.
In Russia, it would seem interesting country for migrants from all over the CIS, it turns out, there is no growth in their number. And popular in Russia, the phrase "come in large numbers here" lost relevance. Just in the country has changed the composition of migrants. If earlier it was the Ukrainians, Belorussians, Baltic states, now - migrants from Central Asia, people with darker (ie more prominent) skin color.
Many studies show that the efficiency and productivity of foreign migrants is much higher than that of the indigenous population. Individual countries such as the United Arab Emirates, Singapore, Canada, Qatar, held, largely due to immigrants.
So perhaps the problem neighboring economy is effectively connected with the inability or unwillingness to effectively manage the immigration process? Compare Russia and Canada. 2015 Russia announced readiness to issue only 126,000 permits for long stay of migrants (with a population of 146 million people.), And Canada - nearly 300 000 (out of a population of 35 million people.). The question arises: what kind of economy will be more effective? It is logical to assume that because of immigrants made their work at a lower cost the Canadian economy will outperform the Russian. In Canada, the policy towards immigrants is a priority. There are more than 60 programs to attract and integrate immigrants. Annually under the patronage of the largest bank Royal Bank of Canada published the rating "Top 25 best immigrants", and the participants will be awarded.
Developing countries, on the contrary, the possibility of realizing their people to acquire new knowledge and experience, establish new contacts and make start-up capital, stimulate (no limit) his emigration. 23 years even the largest developing countries have doubled the number of its immigrants.
These countries receive a return positive effect. For example, India receives more than $ 70 billion in remittances per year, China - more than $ 60 billion, Mexico - more than $ 20 billion. These migrants do not forget about their countries and put them in huge funds, including in the form of direct investment. According to the McKinsey Institute, from $ 100-120 billion of direct investment coming into China every year, about $ 50 billion - this means Chinese migrant businessmen.
The lack of positive dynamics of growth in the number of migrants noticeable in Ukraine and Russia. With regard to the Russian Federation, it becomes obvious that in the near future, it is strongly lag behind the other countries of the BRICS group. Unwillingness to recognize and cooperate productively with their migrants will be a key factor in the backlog. Russia already the smallest ratio of transfers to income Russian migrants - only 6%. In China - 27%, in India - 34%.
Ukraine special attention to its migrants who already has 5 million, and does not pay. On International Migrants Day is not planned large-scale events with the participation of the country's leadership, financial and banking sector in order to thanks for their contribution to the economy of Ukraine. And he's really important - it is expected that in 2014, remittances amount to more than $ 7 billion, or almost 8% of GDP, and with the transfer unregistered channels - about $ 25 billion, or 20% of GDP. Translations have become a major source of foreign exchange inflows (after export earnings). But until there is attention to migrants - there will be no result: translations do not improve the situation with the balance of payments do not increase the foreign exchange reserves, do not contribute to the development of SMEs, etc.
Therefore, Ukraine's time to reconsider the strategy of working with foreign capital, by adopting the best practices for attracting remittances to the country's economy. Here it is necessary to give an example of the Philippines. In this country, special attention is given to Filipino migrants not only on 18 December and the entire month of December. On a daily basis during the month of Filipinos all foreign governments, banks, social services have the honor due to migrants and their households for the financial and material support, they provide home country. The key event - handing Philippine President awards and letters thanks to migrants made in the current year, the largest contribution to the development of the country.
As a result, only through financial and banking system of the Philippines receive more than $ 25 billion a year. Through the development of financial and banking, insurance, transportation volumes transfers are growing rapidly. It is through remittances Philippines have created a stable economy with a surplus balance of payments. Over the course of 2004-2013, the Philippine peso has appreciated by almost 25%. In the global crisis in 2009, when almost all national currencies declined against the US dollar, the Philippine currency has strengthened by 5%.
It is interesting to compare key indicators of the economy of Ukraine and the Philippines. At a much lower specific potential of the economy (GDP per capita), much smaller amounts of accumulated direct investment, foreign trade deficit balance the Philippines, in contrast to Ukraine, been able to accumulate foreign reserves eight times, and the debt dial half. The success of the economy of the Philippines is directly related to migrants and their remittances home.
Ukraine needs to radically change the attitude towards migrants - because of them really depends on the success of our economy. If the authorities want to make a balance of payments surplus, increase foreign exchange reserves and strengthen the national currency, they should not be given to migrants day, month, and all of 2015. Throughout the year, the central and regional authorities should be up and running long-term cooperation program with migrants, and the financial and banking sector - to develop programs and services to promote the translation of official channels. In addition, the efficiency of cooperation with the IMF, World Bank, EBRD may be much higher if we involve them in the implementation of the strategy of cooperation with migrants. These organizations have a lot of experience "start" of translation in economies of different regions of the world.
Implementation of the above proposals would allow Ukraine already in 2016 to receive $ 10 billion, and in 2017 - $ 15 billion in remittances through the financial and banking system.
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