The Role of Economic and Social Remittances in Shaping Migration Flows from Ethiopia
Insights from the Regional Data Hub (RDH) Research on Young Ethiopian Migration along the Eastern and Southern Corridors: Case Study Report 6
Insights from the Regional Data Hub (RDH) Research on Young Ethiopian Migration along the Eastern and Southern Corridors: Case Study Report 6
BACKGROUND
In 2019, the IOM Regional Data Hub (RDH) for the East and Horn of Africa (EHoA) launched a multistage research project aimed at better understanding the experiences, decision-making, perceptions and expectations of young Ethiopians along the Eastern Route from Ethiopia to the Gulf Cooperation Council (GCC) countries, in particular the Kingdom of Saudi Arabia, via Djibouti and Somalia. The project included conducting original research with individual migrants along the route (phase one and two) and in communities of high emigration in Ethiopia (phase three).
The first two stages of the research project were carried out in Obock, Djibouti, and Bossaso, Puntland, where research teams interviewed a sample of migrants transiting through these two main embarkation hubs from where they cross over the Gulf of Aden and the Red Sea to Yemen. Three different types of migrants were interviewed: individuals migrating for the first time, individuals who have attempted or successfully completed this journey before; and individuals who have decided to stop their journey and return to Ethiopia.
Quantitative surveys were administered to 2,140 migrants in Obock and 1,526 migrants in Bossaso. Qualitative, semi-structured interviews were also conducted with a sample of 66 migrants in Obock.
The third stage of the project was conducted in the first half of 2021 in communities of high emigration in Ethiopia with the aim of gaining a better understanding of the environment in which migration is taking place and investigating how it is lived and experienced at household and community level. Phase three was also designed to better understand how money, information, knowledge and ideas flow transnationally between communities in Ethiopia and migrants abroad, as well as to gauge whether the coronavirus disease 2019 (COVID-19) has changed the migration environment and impacted migration from and to these communities. This report builds on the findings of this third phase, drawing on data collected through the methodology highlighted below.
My brother went to South Africa hoping for a better life but he was put in prison in Tanzania on his way there. I wanted to also go but now I prefer to stay here and work as a carpenter because my brother told me about the problems in South Africa. © IOM
METHODOLOGY
Data collection was carried out by JaRco Consulting PLC in five communities in Ethiopia. Research findings from phases one and two guided the initial selection of target woredas of origin of migrants, which were chosen according to the volume of flows and the presence of a mixed pool of migrants. Selected woredas were then triangulated with annual IOM Flow Monitoring (FM) data on migration flows along the Eastern Route. Selected woredas included (Amhara), Setema (southwest Oromia), Deder (east Oromia) and Erer (Harari). The additional woreda of Misha in Southern Nations, Nationalities, and People’s Region (SNNP) was selected through FM data as representative of communities of high emigration towards the Southern Route.
Rapid assessment
A rapid assessment was carried out in each woreda to assess whether it was suitable for the research and fulfilled the study’s requirements, and to generate community profiles for each of the targeted areas. The rapid assessment involved both primary and secondary data collection on the socioeconomic, environmental, security and migratory landscapes in each location and contributed to a better understanding of the local environment; defining the geographical boundaries of each data collection site; identifying research areas within each woreda (areas with a high concentration of households with at least one member who is currently abroad or has returned); generating an understanding of local migration dynamics; and identifying key informants (KIs) such as community leaders and former migrants for the qualitative part of the research.
Primary data was collected through observation of study sites and by interviewing KIs to gather in-depth, context-specific information from each target woreda. Within each area, individuals with different areas of expertise were interviewed, including a representative of the economic sector, a representative of women’s affairs, government representatives, religious leaders and informants from the migrant community. Secondary data was collected through a review of relevant literature including research papers, academic studies, migration data and publications from non-governmental organizations, the United Nations and the Government of Ethiopia.
Household sampling
A listing was carried out in each area to understand the distribution of migrant households throughout that area and identify the potential households to interview. Listing was conducted prior to data collection and a number of households greater than the target sample size for each domain was identified. The target sample was set at 500 households per area, half with and half without experience of migration, to allow for comparison – the target sample was raised to 600 households in Misha because it was the only community representative of the Southern Route. In addition to the presence of migrants and returnees, information on gender, age and intended destination of migrants was also collected. Overall, 4,396 households were listed across the five communities, with a total of 2,439 migrants identified of whom 991 were returnees. Details on the sociodemographic profiles of surveyed households can be found in the Annex.
INTRODUCTION
The Ethiopian Diaspora is one of Africa’s largest, with the Government of Ethiopia estimating that over 3 million Ethiopians live outside of their country (MPI, 2021). Economic remittances from abroad are often a lifeline for households in Ethiopia who rely on remittances to cover their basic needs. Remittance estimates for Ethiopia vary, with the World Bank estimating annual net remittance flows in Ethiopia in 2019 at 479 million United States dollars (USD), while the National Bank of Ethiopia estimates the value of remittances to have reached USD 4.5 billion in 2019, around 5 per cent of the country’s gross domestic product (MIDEQ, 2020). Despite the substantial difference between sources, remittance inflows clearly significantly contribute to the Ethiopian economy. Most remittances to Ethiopia are sent from the United States, the United Arab Emirates, Djibouti, Saudi Arabia and the United Kingdom (RemitScope, 2020).
In the areas of high emigration studied in this research, economic remittance flows from Saudi Arabia and South Africa have significantly fostered households’ well-being by supporting them with daily living costs, providing the financial means to start small business ventures, allowing for the purchasing of consumer goods and the construction of new or improved housing and in making social investments in the education of migrants’ children and siblings. Remittances also support the migration of family and community members. Survey data show that in around 11 per cent of households with migration experience, migration was financed through remittances, particularly in Misha, where 36 per cent of journeys were financed this way (IOM, 2022a).
Such subsequent migration would not have been possible if the flows of economic remittances had not been reinforced by social remittances facilitated through transnational communication channels and exchanges. The term ‘social remittances’ was coined to capture the notion that in addition to monetary remittances, migration also entails the exchange of ideas, practices, identities and social capital between sending and receiving communities. Such intangible exchanges can happen when migrants visit or return to their home countries, when they are joined by family and friends in their host countries or when migrants and non-migrants communicate transnationally through phone-calls, social networks, video-chats, letters or other people (Levitt and Lamba-Nieves, 2011).
ECONOMIC REMITTANCES
This research shows that cross-border, monetary transfers play a large role in the well-being of migrant households, and their economic impact on the lives of migrant families inspires and enables future generations to migrate. According to community leaders and other experts interviewed for this research, formal and informal ways exist in which migrants send remittances to Ethiopia. Some migrants send remittances through the official banking system, oftentimes with the help of regular migrants who can access official banks and money transfer companies such as Western Union that irregular migrants cannot access. Other migrants send money to Ethiopia through regular migrants who are returning. Migrants abroad also often send money through a Hawala system of informal agents as it is cheaper than the regular banking system and easily accessible to irregular migrants. Informal money transfers are particularly common due to the predominantly irregular nature of these migratory corridors.
Frequency, mode of transfer and
importance of remittances
Survey data show that only around one in two households was able to receive remittances once the migrant arrived at destination (59%). Households with multiple migrants, that is households with more than one individual with migration experience, had a higher remittance rate, with 83 per cent reporting that they were receiving remittances from at least one migrant member. Multi-migrant households are often more involved in the migration process itself, oftentimes arranging and co-financing the migration, and generally experiencing higher success rates compared to single-migrant households.
Most surveyed households reported receiving remittances on a somewhat irregular basis – that is, every three or four months (37%) or once or twice a year (49%). Most households reported receiving remittances through informal channels (54%), while formal channels such as banks (37%) and official money operators (16%) were also commonly used.Remittances seem to provide an important contribution to household income, with 47 per cent of remittance-dependent households rating them as “very important” and 39 per cent as “somewhat important” to their household. However, these rates vary between communities, with households in high-migration areas such as Raya Kobo and Misha rating remittances as ‘very important’ more frequently than households in Erer, the community with the lowest migration rate in the study.