Pardee-CFLP-Remittances-TF-Report

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leadership. Formal payments systems and financial intermediation may functionpoorly or not at all. 14Role of Remittances in Post-Conflict CountriesRemittances are funds sent home by nationals living and working in other countries,usually to family members in the country of origin. In achieving stabilityand economic security, post-conflict nations rely heavily on these remittances. 15The funds are widely distributed and flow to many areas that are neglectedby other forms of aid. 16 Funds sent from abroad are generally spent on individualor household private needs, such as food and housing, and create rippleeffects throughout the local economy. 17 Remittances help the national balanceof payments, boost economic development, and improve the general standardof living. 18There is no question that remittanceshave become a criticalsource of foreign currency formany post-conflict nations.Countries in conflict generatesignificant diasporas, a portionIn many post-conflict nations remittancesexceed the total amount of official developmentassistance, and in about one-thirdof all developing countries, remittancesexceed all capital flows.of which prefers its new life to repatriation after the conflict but seeks to supportrelatives who remained behind. 19 As a result, in post-conflict areas, remittanceshave become a critical source of capital for development and stability. 20 In manypost-conflict nations remittances exceed the total amount of official developmentassistance, and in about one-third of all developing countries, remittances14 Rob Mills and Qimiao Fan, Investment Climate in Post Conflict Situations, World Bank Policy Research WorkingPaper 4055 at 11 (2006).15 Organization for Economic Cooperation and Development, Conflict and Fragility, Fragile States Resource Flowsand Trends, 42 (2013).16 Russell King and Julie Vullnetari, Remittances, Return, Diaspora: Framing the Debate in the Context of Albania andKosovo, Southeastern Europe and Black Sea Studies, 9:4, 385–406, 390 (2009).17 Id.18 K. M. Abdul Azeez and M. Begum, International Remittances: A Source of Development Finance, 4 InternationalNGO Journal 299, 301–04 (2009).19 US Agency for International Development, Understanding the Post-Conflict Country Analytical Template at 34(September 2009).20 In 2010, formal remittance flows worldwide exceeded $440 billion, with approximately $330 billion sent todeveloping countries. This is three times the amount of official aid provided to these nations, and approximates theaggregate amount of foreign direct investment in these countries. The World Bank, Migration and Remittances FactBook 2011 (2nd Ed. 2011).Remittance Flows to Post-Conflict States: Perspectives on Human Security and Development 41
exceed all capital flows. 21 A recent World Bank study found that remittances“play a vital and life-sustaining role for millions of vulnerable people in poorcountries, particularly in post-conflict countries and in situations where formalfinancial services and infrastructures are nonexistent.” 22In addition, remittances tend to be markedly more stable than other privatecapital flows, such as portfolio investments and bank credits. 23 The importanceof remittances in helping post-conflict countries was emphasized in a reportissued by the International Peace Academy, which stated:Nearly all the countries in the conflict, war-to-peace transition, and crisiscategories are highly dependent on remittances. The slow recovery oflivelihoods and persistent violence or repression ensure high levels ofmigration and the need for remittances in such countries for severalyears after conflict and crises have ended. By all accounts, migrantremittances reduce poverty in important ways in developing countries.Research shows that migrants transfer funds and invest in their countriesof origin at times when international investment has all but disappeared.By serving these purposes in countries emerging from or still experiencingconflicts . . .remittances can be seen as a sine qua non for peaceand rebuilding. 24Impact of RegulationStudies indicate that a significant portion of remittance transfers flow throughunregulated channels and the use of such informal channels hampers effortsto prevent funds from flowing to entities that engage in criminal or terroristactivities. 25 The preference among remitters for informal transfer mechanismspartly reflects low financial literacy, as well as widespread distrust of government21 Id. at 1758.22 M. Maimbo and D. Ratha, Remittances: Development Impact and Future Prospects at 13 (World Bank 2005).23 Historically, remittances have been stable and even countercyclical, tending to rise during times of financialcrisis and natural disasters because migrants living abroad send more money to help their families back in placesof origin. United Nations Development Program, Towards Human Resilience: Sustaining MDG Progress in an Ageof Economic Uncertainty at 129 (2011), available at http://tinyurl.com/UNDP-MDG-Progress.24 Patricia Weiss Fagen and Micah N. Bump, Remittances in Conflict and Crises: How Remittances Sustain Livelihoodsin War, Crisis and Transitions to Peace, International Peace Academy and Georgetown University at i (2005)(hereinafter “Fagen and Bump”).25 That unregulated transfer systems are open to abuse—ranging from money laundering to support for terroristactivity—is well documented. Id. at 11.42 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 and 22: eceiving remittances provides an en
Page 23 and 24: associations for post-conflict inst
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 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-
Page 80 and 81: Figure 1: Liberia Per Capita Income
Page 82 and 83: associations, women’s groups, alu
Page 84 and 85: 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
Page 90 and 91: Knowledge RemittanceThe Liberian di
Page 92 and 93: process furthermore was a pioneerin
Page 94 and 95: Levitt, Peggy and Deepak Lamba-Niev
Page 96 and 97: Section III: Diaspora Networks andC
Page 98 and 99:
Post-Conflict Development,” this
Page 100 and 101:
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
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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
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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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