Ever since aspiring migrants from this land began to move overseas in search of fortune -- say, since the Second World War -- remittances that they sent home were meant for consumption, or at best for building concrete structures replacing thatched huts in their village homes. This is particularly true to migrant workers who left their rural homes in Sylhet for the United Kingdom since the late forties. Given the circumstances prevalent in those days, it was inevitable. The immediate urge that prompted them was to put up, as quickly as possible, a foundation of better living for their families back home. Over time, their money began to be spent in purchasing lands, initially agricultural lands, followed by lands to build houses in the district town. Rarely their remittances got into any worthwhile business investment.
That was long time back. With the flow of migrant workers increasing across vast swathes of the globe, and contributing heartily to the economy over decades, the pattern of spending the remittances has, for the most part, remained unchanged. That is to say, use of migrant workers' remittance is still more on consumption than investment or any other productive purposes even though the country now receives billions of dollars as inward remittances. This has been found in a study conducted by the International Labour Organisation (ILO). The ILO study, 'In the Corridor of Remittance: Cost and Use of Remittance', finds a negligible impact of remittance on investment as most of the money sent home is still spent for meeting basic consumption needs. The study, among other things, points out that this scenario is largely due to dependence of the families of the migrant workers on remittance for their very survival. Due to widespread poverty, the tendency to spend remittances on consumption is high and is likely to remain high in future too, according to the study.
Added to the heavy dependence of the families back home on remittances, absence of proper policies has also been found responsible for lack of productive use of remittances. The situation could have been different had there been advisory services or awareness building campaigns for the migrant workers to guide them on how best to use their hard earned money. Due to the spending mostly on consumption, no worthwhile income generating activities are also noticeable, the study says.
While remittance is recognisably a significant economic variable on many counts, the fact that it has very little influence on entrepreneurship, even on a small scale, is not heartening at all. Seventy five per cent of the families, the ILO study finds, use remittance for food, followed by education, health, loan repayment, purchase of property, wedding-related expenses, repair of houses etc. Around 21 per cent recipients are in a position to do some saving, 13 per cent invest in saving schemes and 12 per cent in self-owned enterprises. Use of remittance in a partnership-based business and stock market are very negligible, according to the study.
The government's investment instruments for expatriates such as wage earners' development bond, US dollar investment bond and the US dollar premium bond do not seem to attract remittances in a big way.
The ILO study also found that the wage earners' development bond has lost momentum in sales among the non-resident Bangladeshis (NRBs). The lack of interest has been attributed to the introduction of 5.0 per cent tax on interest earnings at source, lack of confidence due to fluctuation of interest rates, loss of interest in investment following the stock-market scam and government's inability to recover the investors' money, says the study.
In this context it must be mentioned that investment of remittance is not necessarily meant to be in businesses or profit generating schemes only. It is the productive use of remittance that matters, and it is here that use of remittance in education, community development programmes is indeed an important aspect. The study shows that here also the migrants' money, if spent at all, is not very well spent. As for the 'unproductive' use of remittance meaning building houses, and/or buying lands, the obvious motivation is security of the money. This has been a very common trend in almost all the remittance-receiving locations of the country.
Because of the sense of security from land and other immoveable properties, migrants are not likely to shift their attention to what is considered 'productive investment'. It may be noted in this context that although there are occasional hypes on facilitating investment and business ventures by NRBs, nothing in clear terms has emerged about how the government can help them in a meaningful way. There is no noticeable progress in utilising the wage earners' welfare fund and the services of the Probashi Kalyan Bank which is purported to promoting or supporting expatriates' welfare. There are also no initiatives to promote small and medium enterprises which could have been worth exploring in locations with high concentration of migrant workers.
wasiahmed.bd@hotmail.com
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