remittances, South Asian laborers in Dubai, South Asian migrant workers in Dubai
Kamran Jebreili/AP
Burj Dubai, the world's tallest under
construction building in Dubai,
Arab Emirates, Wednesday, Dec. 31, 2008.

As Dubai’s Jobs Disappear, Migrant Workers’ Families Hit Hardest

January 14, 2009 07:28 AM
by findingDulcinea Staff
Dubai’s South Asian laborers, whose families and home countries depend on their remittances, are in trouble as businesses in the United Arab Emirates falter.

Remittances Set to Decline

Economic analysts are predicting that remittances from the Gulf Arab region could fall by 9 percent in the upcoming year, raising concern about South Asian economies, reports Reuters.

It is estimated that the region is home to about 3 million South Asian laborers, who last year sent 21 percent of global remittances—funds transferred by migrant workers to relatives in their home countries—to nations such as India, Pakistan, and Bangladesh.

An Indian worker named Shalu, 33, told Reuters that he was recently laid off after working for one year at a construction job in Dubai, despite having paid a migrant labor agency to send him overseas on a three-year contract. He is now at home in his village of Kerala, India, saving money to get another agency to send him to work in Saudi Arabia. “It’s a big problem,” he said to Reuters. “They gave me sudden notice and no release (to find other work).”
Most migrants, like Shalu, work in the construction sector, which has seen abandoned or delayed projects during a slowdown due to falling oil prices that have put a damper on the region’s previously booming real estate market. The price of a barrel of U.S. light sweet crude for December delivery hit an 18-month low on Oct. 27 of $61.30.

Background: Remittances around the world

Some countries are reporting that, despite the global economic slowdown, remittances continue to be strong, after posting a 38 percent rise globally last year.

In the South Asian country of Bangladesh, the Daily Star reported recently that there was $8.22 billion last year in remittances, compared with $6.55 billion the year before. It is also forecast that they will reach $10 billion by the end of this year, a substantial growth since 2000, when the total was approximately $2 billion.

Remittances are also increasing in Vietnam, where Ho Chi Minh City alone saw $5 billion in remittances last year, up from $3.6 billion in 2007, the Voice of Vietnam reports. In 2008, remittances from overseas to Vietnam totaled $8 billion.

But in the nearby Philippines, The Manila Times reports that foreign currency reserves will likely take a hit this year due to declining remittances from Filipino workers overseas, who usually send money home in the currency of the country where they earn it. Fitch Ratings Inc. said that the country’s gross international reserves (GIR) are expected to be below $37 billion in 2009.

It is also being reported that Western Europe’s economic woes are affecting its migrant workers from Eastern Europe and Central Asia, meaning that their home nations, already suffering from poverty, corruption and unemployment, are primed for trouble. Russia and Western Europe have large numbers of workers from countries such as Moldova, Tajikistan or Albania, many of whom now have less money to send money home to their families.

And in Jamaica, the Jamaica Observer reported in December that remittances were down 17.3 percent, or $28.4 million, during November compared to the same month last year—“the second consecutive month of decline and the single largest monthly decline on record.”

Related Topics: Migrant worker struggles

The financial crisis will be adding an extra burden on the backs of migrants, who already suffer a variety of ills due to their vulnerability in their host countries, including exploitation, human rights abuses and accidents and diseases on the job.

In April 2008, 54 migrant workers from Burma suffocated to death in a truck while being smuggled into Phuket, Thailand, just one of the countless tragedies that befall migrant workers worldwide every year.

Last year’s International Labor Day was marked by protests over incidents of migrant abuse. In one notable incident, Chinese authorities freed about 100 Chinese teenagers who were being forced to work long hours for meager pay in factories along the country’s coast.

Reference: Remittances


Most Recent Beyond The Headlines