Asia’s immigration story: Big challenges, bigger opportunities

Rarely has the topic of immigration received so much attention as it has in the past year. Conflict, poverty and a lack of adequate job opportunities have been at the forefront of migrant behavior for hundreds of years, but only recent political developments around the globe have led millions of citizens—and businesses—to rethink their stance on immigration.

The US has long been home to the largest number of international migrants, but no region of the world has seen more immigration growth of late than Asia. Indeed, from 2000-2015, Asia added more international migrants than any other major area. During this time, Asia saw an increase of about 26 million international migrants, or 1.7 million per year. (Europe was second, adding 20 million migrants, or 1.3 million per year.)

For some Asian countries, immigration’s impact on economic development has been dramatic. Malaysian immigrant workers have become a key source of labor for low-skilled jobs, often in labor-intensive sectors such as construction, agriculture and manufacturing. And studies have shown that a 10% net increase in low-skilled foreign workers could bump up Malaysia’s GDP by 1.1%, creating more employment opportunities and boosting wages for most Malaysians.

So what drives migrants into countries such as Malaysia? As is the case in so many other parts of Asia (and the rest of the world), it’s a combination of better opportunity and demographics. Malaysia’s gross national income per capita is $10,570, for instance, compared to $3,440 in Indonesia. That’s much higher than countries like Bangladesh and Nepal.

Sending money back to worker’s home countries—remittances—is also a big factor.

“The evidence shows that immigration is accelerating, with total remittances received by developing Asian countries nearly doubling between 2010 and 2015, from US$57 billion to US$106 billion,” says Associate Professor Vu Minh Khuong, of the Lee Kuan Yew School of Public Policy. “Remittances received are a major source of income in some countries—in 2015, remittances made up 10% of GDP in the Philippines and nearly 7% in Vietnam.”

Meanwhile, those countries that lose the largest numbers of immigrants to Malaysia generally have younger populations. The need for labor tends to be more urgent in nations whose working-age population is aging, so countries like Malaysia, Singapore, Vietnam and Thailand need more workers, while Myanmar, Indonesia and the Philippines have too many.

In 2015, the Association of Southeast Asian Nations (ASEAN) unveiled the ASEAN Economic Community (AEC), partly with the intent of assisting in the free flow of skilled professionals in the region. Some of the results, according to the group, include the elimination of tariffs and the facilitation of trade, boosting investment, streamlining capital market regulatory frameworks and platforms, and consumer protection and intellectual property rights.

Confronting the challenge

If it’s agreed that there is now more awareness of the plight of migrant workers, it’s also agreed that the challenges facing those workers are no easier to solve. There are too many stakeholders—local citizens, employers, governments, migrant workers and their home countries—to please all constituencies, and the immigration policies of countries around the world are as complex as they are diverse.

Vu notes that the benefits of more open borders are twofold: “On one hand, they provide their home countries with a significant source of income, which if well managed can play an important role in poverty reduction and capital investment,” he says. “On the other hand, immigrant workers not only help their host countries solve labor shortage problems but also contribute to economic vibrancy and competitiveness.”

But without good policy in host countries, Vu says, firms may become dependent on immigrant workers and avoid making capital investments, innovations, and capacity upgrades. And home countries should adopt policies that make sure that the income from remittances is used wisely for developmental purposes.

A recently released case study by Singapore’s Lee Kuan Yew School of Public Policy took a look at some of the practical and ethical considerations surrounding interstate migration. The research focused on how the rights of those born in less privileged countries can be preserved in an era when states are increasingly espousing border policing and exclusionary immigration policies. The study offered possible policy solutions from a host of experts, including those who suggest migrant workers could be restricted to a particular sector instead of being beholden to one particular employer, which could make them vulnerable to exploitation. Additionally, there should be greater efforts made at penalizing employers who deceive workers into accepting unsatisfactory conditions.

Others submit that migrants should contribute to social security systems but receive a refund when their contract is complete, encouraging them to return home. Combining this with certain fees on employers might encourage employers to prioritize locals. Finally, some note that because populations are generally agreeable to allowing migrants access to welfare on a reciprocal basis, a better way to encourage citizens to accept migration may be to allow migrants, or their employers, to contribute to existing welfare systems.

None of these proposals would be easily implemented, nor would they solve every issue facing migrant workers, but the time to revisit policy concerns in this area is now.


This piece was first published in Quartz on 5 October 2017.