Mon, Aug 10, 2009 page11

• Economic downturn hits Asia’s overseas workers

  IMPACT NOW BEING FELT: Millions of families in poor Asian countries rely on remittances from relatives working in unskilled jobs, jobs which are disappearing

  • AFP
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  When Anita Gimmi was unable to find work in her native Nepal last year, she borrowed US$1,300 and traveled to Qatar to take up a two-year contract with a cleaning company.

  Less than a year later, the 26-year-old has been forced to return home still heavily in debt after becoming one of thousands of foreign workers to be laid off as the economic downturn hits Southeast Asia and the Middle East.

  “I had no choice but to go abroad because there are no employment opportunities here in Nepal,” said Gimmi, whose parents, husband and son all depended on her monthly salary of US$155. “The family had quite a decent life for a while, but now our situation is miserable. Even getting two proper meals a day is becoming difficult, as I don’t have any income at present.”

  

  Men line up to pay fees to get foreign employment at an office of the Department of Labor and Employment Promotion in Kathmandu, Nepal, on Friday.

  PHOTO: AFP

  Millions of families in poor Asian countries rely on remittances from relatives working in unskilled jobs, such as construction or as domestic servants in Southeast Asia and the Middle East.

  The World Bank last month forecast a 7.3 percent fall in remittance flows to developing nations this year, however, as the recession hits jobs in richer countries that have traditionally employed large numbers of foreign workers.

  Nepalese economist Shankar Sharma said remittances from workers abroad accounted for around 20 percent of the country’s GDP and were its single most vulnerable source of income.

  “Nepal escaped the immediate impact of the global financial crisis, but its effects are slowly becoming visible,” Sharma said. “The growth of remittances declined to 28 percent in 2008-2009, from 42 percent the previous year. So the recession has started showing some impact.”

  Many Asian countries, including Nepal, Bangladesh, the Philippines and Pakistan, have registered increases in foreign remittances this year.

  The central bank of the Philippines — the fourth-largest recipient of overseas remittances in the developing world after India, China and Mexico — said such payments reached a record US$1.48 billion in May.

  Experts say this may reflect a growing number of workers returning home for good, however, bringing their savings and severance packages with them.

  “Such a phenomenon would lead to a sharp reduction in remittances in the following months,” the World Bank said in a recent report on the Philippines.

  Pakistan’s economy relies heavily on its roughly 4 million expatriates — around 2 million of them in the Gulf — and registered a record US$7.81 billion in remittances for the 2008-2009 financial year.

  Economist A.B. Shahid said, however, that this was “due mainly to the transfer of settlement dues by Pakistani expatriates whose services have been terminated in recession-suffering Gulf countries.”

  This is a worrying development for Maimoona Ayub, a housewife and mother of four in Karachi, who relies completely on money wired home by her plumber husband in Dubai.

  “His support helps me raise and educate our children, but now his job is also in danger,” she said. “He told me many of his co-workers have been fired and he was prepared for the same fate.”

  In impoverished Bangladesh, where in the past year alone remittances contributed 11 percent to GDP, government figures show a huge drop in the number of people going abroad to seek work.

  Almost 251,000 people left the country between January and June — a 50 percent drop on the same period last year, the Bureau of Manpower and Employment Training’s (BMET) figures showed.

  BMET Director General Masud Ahmed said the slowing of economies in the Gulf region, where many Bangladeshis are employed, was a key reason for the downturn.

  “Unless their economies pick up, we don’t see any major boost in the country’s manpower export,” Ahmed said.

  Vietnam’s state news agency reported last month that the government was unlikely to meet its target of sending 90,000 people to work abroad this year because of the economic crisis.

  Many workers have had to return home before their contracts expired in recent months because of the global recession and steps are being taken to help them, it quoted a labor ministry official as saying.

  Vietnamese welder Tran Trung Hieu left for Slovakia last November on a three-year contract, but was expelled in May after his company terminated the contract citing the economic downturn.

  The 22-year-old said his family had borrowed more than US$11,000 to send him.

  “[The company] promised several times to pay back the money, but my family hasn’t yet received any of it,” Hieu said.

  “We sent him there to struggle against poverty,” said his father, Tran Van Dung. “Now we are in debt.”
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