MANILA (OFW Journalism Consortium) – CAN you monetize a child’s separation for more than a year from her mother working overseas?
Such question has not only kept both mother and child sleepless at night but economists like Alvin Ang burning the midnight oil.
With most of the eight million Filipinos overseas linked to their country one way or another, Ang said it’s time to face up to the socio-economic cost of such profitable arrangement.
But for an economy that will not see diminished reliance on remittance inflows and overseas migration outflows in the coming years, Ang is searching for a formula where migration yields visible economic returns.
We’re looking at the “net of net” –a dividend, said Ang, a professor at the University of Santo Tomas.
That “net of net” is what Ang calls the “diasporic dividend” of the socio-economic costs of international migration to the country.
This type of dividend, Ang explains to the OFW Journalism Consortium, will relate remittances with exports and imports.
It is a calculation of the power of remittances beyond picking up the slack from weaker conditions in the country’s trade and foreign direct investments.
This line of thought comes from what Ang said was the shift of the country’s place in global trade.
“Before, the Philippine economy became globalized because of trade,” Ang said. “Now, it is migration. It is people.”
His assertion is supported by the results of a survey by the US-based thinktank A.T. Kearney and the Foreign Policy journal.
Four years of that globalization survey cemented he calls the Philippines’s showcase –its workers– in the global economic arena.
The Philippines is being recognized for the “value of its workers,” and not because of its products and investment prowess, Ang said.
ANG’S search for a dividend from the migration phenomenon was brought about by the results of the 2007 Globalization Index: the Philippines dropped to 38th overall, from being 31st in the 2006 index.
That index’s Philippine ratings on trade, foreign direct investment, and remittances and personal transfers only affirm the “divergence” the Philippine economy felt, Ang observes.
Since the 2004 Globalization Index, the Philippines has ranked first in the sub-category “remittances and personal transfers” in 2004 and 2006, and second in the same sub-category in 2005 and 2007.
The Index had studied 12 variables grouped into four major categories: economic integration (where the Philippines placed 41st), personal contact (14th), technology (61st), and political engagement (49th) (see Table 1). “Remittances and personal transfers” fall under personal contact.
In the same 2007 Index, the Philippines ranked 24th in trade and 63rd in foreign direct investments –the lowest Philippine rankings in these sub-categories in the last four years of the Globalization Index.
What Ang finds “interesting,” citing Philippine economic data on exports, imports, and the current account (where remittance inflows are recorded), is that remittances only make up 15 percent of the combined total of exports and imports.
(To be continued)