Pardee-CFLP-Remittances-TF-Report

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In local communities, remittances circulate through local associations and networksof mutuality, trust, and solidarity. The role of social capital is particularlyimportant in creating sustainable institutional linkages on multiple scales. Inpost-conflict contexts, the fragility of existing institutions hinders their ability tolink with each other and additional groups, networks, and institutions to bolsterimportant social systems (Vervisch and Titeca 2010). Attempts by outside groupsto facilitate connections among institutions often focus on the technical aspectsof institutional operations and overlook the social and political contexts, resultingin the existing elites retaining leadership and disrupting opportunities forlocal leadership to evolve (Vervisch and Titeca 2010; Brune and Bossert 2009).Thus, the challenge of post-conflict institutional development is determininghow best to help improve the ability of local institutions to connect with existinglocal social support systems, which in turn have been disrupted by widespreadpopulation displacement and social and physical devastation.External interventions in institutional syncretism can often be technicallyoriented rather than socially and politically embedded, leading to favoring ofthe existing elites and interfering with the evolution of local leadership (Vervischand Titeca 2010; see also Brune and Bossert 2009). The challenge of post-conflictinstitutional development therefore lies in facilitating the building of local socialcapital endowments to enhance the bridging capacities of local institutions. Insuch environments, customary security networks and group loyalties are oftenweakened due to widespread population displacement and social and physicaldevastation.Because of severely limited access to land and natural resources and the breakdownof formal infrastructure, economic exclusion is a serious issue in post-conflictcommunities; as a result, informal businesses and second market activitiesemerge as major coping mechanisms (Cain 2007). Facilitating the post-warinformal economy is therefore frequently seen as central to the rehabilitationof the affected communities. This includes investing in the informal economythrough micro-loans and savings mechanisms (374–375). The role of grassrootsassociations and informal micro-businesses is increasingly discussed in recentstudies of post-conflict development. In post-conflict Liberia, for example, thegrowing importance of informal businesses over subsistence farming has beenobserved, and these businesses are financed primarily through indigenous rotatingmoney saving schemes (locally called susu)—about 70 percent of local businessowners were observed to use these informal clubs (Tarway-Twalla 2011, 63).This highlights the importance of collaborating with these diverse local financialRemittance Flows to Post-Conflict States: Perspectives on Human Security and Development 15
associations for post-conflict institution-building. It also highlights the uniquecapability remittance transfers often provide for expanding financial inclusion inconflict-affected environments.Partnering with local microfinance institutions can be an important strategy forexpanding remittance delivery channels and leveraging remittances for localdevelopment. Microfinance organizations and other semi-formal local financialinstitutions expand people’s options for financial inclusion, especially inmarginal, remote, and low-income communities: “Increasing access to savingsand credit products tailored to low-income families can help families receivingremittances channel these funds toward future investments, such as in housing,education, or microenterprise” (Jaromillo 2005, 133). In many cases, these organizationshave good knowledge of local communities and their clients’ needs aswell as the necessary experience and physical infrastructure for providing financialservices to local “unbanked” populations. As many microfinance programsemphasize social and empowerment goals alongside economic ones, theseinstitutions have the potential to connect remittances with wider developmentgoals of the local communities. Besides novel organizational forms and alliances,the use of new information and communication technologies like mobile phonebased financial applications for cross-border remittance transfers have provenincreasingly relevant for remittance delivery in post-conflict settings.All of this suggests that when leveraging remittances for post-conflict reconstruction,diversification of multi-scale institutions and partnerships for betterremittance delivery and their more efficient use for poverty reduction andproductive investment is vital. This necessarily includes fostering collaborationand coordination among local political, social, and financial groups and institutionswith a shared goal of leveraging remittances to enhance human security inpost-conflict contexts.Contributions of the Report to Analyzing Remittances inPost-conflict DevelopmentThe papers of this Task Force Report investigate some critical issues involved inleveraging remittances for post-conflict development as well as outline directionsfor policy changes and future research. The topics discussed include broaderanalytical issues pertaining to remittance systems, diaspora networks, and theimpact of remittances on post-conflict social and economic rehabilitation, as wellas country-specific issues drawn from a variety of conflict-affected settings indifferent parts of the world.16 A Pardee Center Task Force Report | October 2013
Page 1 and 2: Pardee Center TASK FORCE Report oct
Page 3 and 4: This series of papers, Pardee Cente
Page 5 and 6: AcknowledgementsThis Task Force on
Page 7 and 8: ITU International Telecommunication
Page 9 and 10: networks and migrant associations i
Page 11 and 12: to developing countries than other
Page 13 and 14: But most importantly, remittances a
Page 15 and 16: often mix in the countries of desti
Page 17 and 18: According to the World Bank estimat
Page 19 and 20: Because of its focus on the multidi
Page 21: eceiving remittances provides an en
Page 25 and 26: are proposed to avoid the associate
Page 27 and 28: Terry, D. 2005. Remittances as a De
Page 29 and 30: oader approach to post-conflict rem
Page 31 and 32: networks can be seen as “homogeno
Page 33 and 34: That personalized nature of hawala
Page 35 and 36: Customary law (xeer) and other trad
Page 37 and 38: the world (Lindley 2009, 531). Much
Page 40 and 41: ize the informal equal efforts to a
Page 42 and 43: struction and development. Means sh
Page 44 and 45: opportunities should focus on exist
Page 46 and 47: 2. Dodd-Frank Act and Remittances t
Page 48 and 49: leadership. Formal payments systems
Page 50 and 51: and financial institutions. 26 Reso
Page 52 and 53: closures should be both in English
Page 54 and 55: issued a new proposed regulation De
Page 56 and 57: “closed network,” in which all
Page 58 and 59: Some guidance may be found in the p
Page 60 and 61: the use of mobile devices for money
Page 62 and 63: Foreign TaxesUnder the 2012 regulat
Page 64 and 65: will be available in all cases. CFP
Page 66 and 67: Section II: Remittances in Post-Con
Page 68 and 69: Sri Lanka. The conflict also result
Page 70 and 71: Figure 2: Current Account, Trade Ba
Page 72 and 73:
flows came from migrant workers in
Page 74 and 75:
Informal Remittance Channels in Sri
Page 76 and 77:
tory authorities, with some calls f
Page 78 and 79:
4. The Role of Remittances in Post-
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Figure 1: Liberia Per Capita Income
Page 82 and 83:
associations, women’s groups, alu
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Remittances to LiberiaValue of Remi
Page 86 and 87:
credit because of the need to be li
Page 88 and 89:
Remittance Transfers in Sierra Leon
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Knowledge RemittanceThe Liberian di
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process furthermore was a pioneerin
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Levitt, Peggy and Deepak Lamba-Niev
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Section III: Diaspora Networks andC
Page 98 and 99:
Post-Conflict Development,” this
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One of the main challenges for mobi
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6. Transnational Remittances and De
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The Salvadoran Diaspora is very sig
Page 106 and 107:
annually during the 1990s to less t
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Figure 2: Transnational Vicious Cyc
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The transnational vicious cycle not
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emittance flows is mixed, as initia
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individuals, communities, and famil
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areas. This issue can potentially b
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This is a breakthrough moment: afte
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Edwards, Sebastian and I. Igal Mage
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y La Distribucion Del Ingreso, 1st
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7. Remittances and Community Resili
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For quantitative data collection, a
Page 128 and 129:
Remittances are perceived as playin
Page 130 and 131:
the affected population. Internatio
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ReferencesAddleton, J. 1984. The im
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8. Filling the Gap in Health Staffi
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The alternative is for donors to se
Page 138 and 139:
cians in the U.S. in 2000 (Clemens
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1. Remittances, Financial Inclusion
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networks, and communities. The role
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• In the present era of heightene
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the island of Kosrae, in the Federa
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and Sweden and has held visiting pr
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he organized a number of workshops
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Pardee Center Conference ReportsDev
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