Vital though the flow of remittances may be it cannot

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Chapter 12 / Exercise 9
Macroeconomics
Roger A. Arnold
Expert Verified
Vital though the flow of remittances may be, it cannot, on its own, lift entire nations out of poverty. Those who study the impact of remit- tances argue that the money allows poor covmtries to put off basic deci- sions of economic management, like reforming their tax-collection systems and building decent schools. "Everyone loves money that flows in with no fiscal implications," says Dev.psh Kapur, a specialist on migration and professor of government at the University of Texas in Austin. "They see it as a silver bullet." But bullets wound; and skilled workers often understandably put the interests of their families before those of their countries, choosing to work abroad so they can send re- mittances back home. About eight out of 10 college graduates from Haiti and Jamaica live outside their countries, and about half the col- lege graduates of Sierra Leone and Ghana have also emigrated, accord- ing to the Paris-based Organization for Economic Co-operation and Development. Remittances to poor coxmtries can also mask the fact that they don't produce much at home. In the western Mali district of Kayes where Waly's village of Ambadedi is located and where most migrants' hail from—the region has done so well that farmers use remittances as a crutch. Studies have shown that they spend less time on their land than farmers in other parts of Mali: there is more money to be made by migrating to Europe. "You see poverty other places, but here, you see money," says Abdel Kader Coulibaly, a bank manager in Kayes. He says migrants' families spend all they get, rather than investing it to generate income locally. "A.11 the money ends up with shopkeepers^ and traders from Bamako [the capital]," he says. The trick now is to find programs that maximize the benefits of remitted cash while avoiding some of its downside. Some migrants are now using their economic clout to perform work usually done by big aid organizations. Ambadedi's workers' association in Paris, for example, funds some village projects with its members' own earnings. But the association also solicits help from the French goverrunent and liii i ■ai! '
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Chapter 12 / Exercise 9
Macroeconomics
Roger A. Arnold
Expert Verified
216 WORKING LIVES the European Union. "We have a project tinder way to purify the vil- lage water supply" says Ibrahim Diabira, 55, a relative of Waly who works in Paris as a building cleaner and helps nm the village associa- tion in the French capital. Elsewhere, host nations have created tempo- rary legal work programs, in which migrants earn legal wages with benefits, before returning home. That way, migrants retain close links to their countries while developing skills abroad. "When they go back, they will take augmented skills, savings and networks,'' says Kapur. (He himself left his native India 22 years ago and settled in the U.S.) 12 In Paris, Waly is planning' to return home in J^uary to see his 2-year-old daughter for the first time, and to spend time with his wife. But he won't stay long. "Frankly, people would die there-if we didn't work here," he says. Come spring,‘he wiU be back in Paris,, cleaning offices, and changing the way the world spreads its wealth aroimd.

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