Better migration policies will help boost economic growth, says World Bank

About 2.5% of the world’s population — including 37 million refugees — live outside their country of nationality

Migrants, held up for months in southern Mexico, walk in file to Mexico City to speed up their applications for US asylum. Reuters
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Creating migration policies that are inclusive and developed in a multilateral manner can support economic growth globally, the World Bank says.

This is particularly the case for wealthy and middle-income countries that are coping with ageing populations, as well as lower-income nations that are struggling to create jobs for their youth, the Washington-based lender said in a report on Tuesday.

About 2.5 per cent of the world’s population, or 184 million people — including 37 million refugees — now live outside their country of nationality. The largest share — 43 per cent — live in developing countries.

Populations across the globe are proportionally ageing at an unprecedented pace, making many countries increasingly reliant on migration to realise their long-term growth potential, the multilateral lender said in its World Development Report 2023: Migrants, Refugees, and Societies report.

Wealthy countries as well as a growing number of middle-income countries — traditionally among the main sources of migrants — face diminishing populations, intensifying the global competition for workers and talent.

Meanwhile, most low-income countries are expected to see rapid population growth, putting them under pressure to create more jobs for young people.

“Migration can be a powerful force for prosperity and development,” said World Bank senior managing director Axel van Trotsenburg.

“When it is managed properly, it provides benefits for all people — in origin and destination societies.”

At present, cross-border mobility primarily involves people from developing countries, who make up a large majority of the 295 million people living outside their country of birth, the report said.

Meanwhile, developing countries are also the destination for more than a third of the 260 million economic migrants and more than 85 per cent of the 35 million refugees and asylum seekers worldwide.

Despite the disruptions caused by the Covid-19 pandemic, some of the long-term drivers of mobility have been strengthening, and they are expected to further intensify in coming decades, the report found.

Diverging demographic trends, stresses caused by climate change, transformational new technologies and rising inequalities within and between countries are among these forces, it said.

Violence and conflict have also led to sudden and large movements, including out of Syria, South Sudan, Myanmar, Venezuela and, most recently, Ukraine.

Better mobility recognises that migrants and refugees are “more than just providers of labour or victims to protect; they are persons with human capital, identities, cultures and preferences”, the report said.

“They are men and women who make often-difficult choices and deserve fair and decent treatment.

“Similarly, destination countries are more than just labour markets or sanctuaries. They are complex societies with diverse and at times conflicting interests, decision-making processes and constituencies,” it added.

The report highlighted four corridors for mobility, including the main one leading to the Organisation for Economic Co-operation and Development countries — for about 40 million people from high-income countries and about 90 million from middle and low-income nations.

A second set of corridors links developing countries to the GCC countries for about 30 million people, mostly from low and middle-income countries in Asia and the Middle East.

Another set of corridors comprises “South-South” movements, covering about 105 million people. These movements typically take place within sub-regions.

The fourth group is composed of refugees fleeing persecution, conflict and violence who are entitled to international protection.

Half of all refugees are children, and many others have been made vulnerable by their experiences. Most refugees are hosted in low or middle-income countries neighbouring their countries of origin, and a growing share live in protracted situations of exclusion.

The number of refugees has nearly tripled over the past decade, the report said.

Syria Jordan refugee camp - in pictures

The report underscores the urgency of managing migration better.

Current approaches not only fail to maximise the potential development gains of migration, they also cause great suffering for people moving in distress, the World Bank said.

The long-run dynamic benefits of immigration, even though harder to quantify, include productivity spillovers, promotion of entrepreneurship, innovation and enhanced provision of such critical services as education and health care
World Development Report 2023: Migrants, Refugees, and Societies

“The goal of policymakers should be to strengthen the match of migrants’ skills with the demand in destination societies, while protecting refugees and reducing the need for distressed movements,” it said.

Origin countries should make labour migration an explicit part of their development strategy, the report recommended.

They should lower remittance costs, facilitate knowledge transfers from their diaspora, build skills that are in high demand globally so that citizens can get better jobs if they migrate, mitigate the adverse effects of “brain drain”, protect their nationals while abroad and support them upon return.

Meanwhile, destination countries should encourage migration where the skills they bring are in high demand, help with the inclusion of migrants and address social affects that raise concerns among their citizens.

They should let refugees move, get jobs and access national services wherever they are available, it said.

In the coming decades, the share of working-age adults will drop sharply in many countries. Spain's population of 47 million is projected to shrink by more than one third by 2100, with those above age 65 increasing to 39 per cent of the population from the current 20 per cent.

Countries like Mexico, Thailand, Tunisia and Turkey may also soon need more foreign workers because their population is no longer growing.

“Migrants are a source of economic growth and increased efficiency in destination economies, especially over the long term. By easing labour market constraints, they expand the supply and lower the prices of many services and goods,” the report said.

Low-skilled migrants perform many of the jobs that locals are unwilling to take. Highly skilled migrants, such as nurses, engineers, professional athletes and scientists generate local, sectoral and national efficiency spillovers and boost the productivity of their co-workers.

“The long-run dynamic benefits of immigration, even though harder to quantify, include productivity spillovers, promotion of entrepreneurship, innovation and enhanced provision of such critical services as education and health care,” the report said.

International co-operation is essential to make migration a strong force for development, the World Bank said.

“Multilateral efforts are needed to share the costs of refugee-hosting and to address distressed migration,” it said.

“Voices that are underrepresented in the migration debate must be heard. This includes developing countries, the private sector and other stakeholders, and migrants and refugees themselves.”

Updated: April 25, 2023, 2:00 PM