Updated: Jan 21
The government of Malawi is trying to acculturate resources generated by Malawians living abroad in its menu for development. Starting at just under US$1 million dollars in 1995 when data were first compiled by the Global Economy, Malawians abroad were remitting US$32.9 million home by the end of 2015. This represented a rise from almost nothing to 5% of total foreign currency earnings from tobacco. In 2017, remittances comprised US$37 million, or 17% of total tobacco earnings.
In 2012, the Ministry of Foreign Affairs and International Cooperation (MoFA) set up a desk to handle diaspora affairs. Warm bodies were tasked with some luminous tasks. A single, but non-interactive page on the Ministry of Foreign Affairs’ website was set up, and it stands just as obstinate today. As Alick Nyasulu notes in a 4 August 2017 The Nation article, even Perks Ligoya spread his Reserve Bank Governor wings to reach out to diaspora Malawians in several countries.
Global remittance flows almost reached US$600 billion in 2017, more than triple the amount of total global aid to developing countries. The rationale for tapping into these flows for Malawi surpass the need to reconfigure the utility of inflows destined for Malawi, but also concern how we can capture a portion of the more than $550 billion on their way elsewhere.
But the big question for Peter Mutharika and Goodall Gondwe is how Malawians living in the diaspora will be engaged with development efforts back home. On a basic level, the question borders on whether the country remains attractive enough for those that have had the opportunity to traverse beyond our borders. An enquiry into this view of one’s country quickly and often yields a revelation of much lost patriotism by many diaspora Malawians, who would rather engage in the economies of their new homes than experiment with an economy that seems resolute on a downfall.
It is not clear how many Malawians live in the diaspora. Formidable speculation goes that Manchester City alone, in England, may have more Malawian medical doctors than the entire country of their origin. But this is only the first vital aspect that will stifle the significance of a diaspora policy designed to re-engage Malawians living abroad in mainly the economic affairs of their country. Besides, the custodian of this policy, the MoFA, will have to assess the level of residual interest in their country that diaspora Malawians have left in them the moment their passports are stamped at our ports of exit to foreign lands.
Despite the ambivalence of how many of us are spread across the globe, our point of convergence could easily be that there are many. Although 'many' is not too helpful a statistic, the financial evidence above is good enough to direct attention to tapping into their potential for Malawi. After all, it would not be wise to set up a policy if a handful Malawians were out there, making a living off of wiping the behinds of old people in Western countries. Nonetheless, for decades, colonialism and post-independence relations with the global village have incentivized outmigration for education and work, both which have resulted in many Malawians – like the doctors supposedly stuck in Manchester – to remain abroad. How much these citizens have contributed to the advancement of Malawi, aside from their flashy foreign lifestyles attracting more Malawians out of the misery called home, remains an even bigger mystery.
Global trends show strong growth of the role of remittances in development of rising economies. Leading remittance recipients such as Egypt, the Philippines, Nigeria and several in Latin America all illustrate the power of remittances in steering national development. For the Philippines, remittance inflows make about 50% of their GDP. It is unsurprising if remittances replace development aid in the near future. It means, by setting up a desk at the MoFA, Malawi is doing right to recognize its diaspora citizens. But the story is far from complete. The hard and soft infrastructures that would drive change seem to be a critical missing link. And, unfortunately, it is not merely a structural issue that we can afford to ignore.
Anecdotally, the main investment Malawians based abroad have made has been house construction as either infrastructure that fulfills filial responsibilities of emigrants or (a) piece(s) of investment geared towards pocket money towards close family members or that which can be used during a holiday. Yet some have constructed houses to cater to a rainy day, owing to the unpredictabilities of staying abroad. Many diaspora individuals who establish business ventures will do so as traders who access quality goods and services that are transferable from foreign countries to Malawians who can afford them here at home.
Few, if any, diaspora Malawians have created business ventures that are worthy of reckoning. To date, there seem to be none that operate as producing entities with the capacity to create jobs, drive innovation and advance standards of living. This latter point is usually overlooked by many home-bred Malawians who are incapable of seeing the life that awaits beyond the flight to a foreign country, in which the aspirations of a better life only materialize for a handful few.
To elaborate the point of success beyond the borders, the numbers of Malawian professionals working in several major metropolises of the world are supported by larger fringes of unskilled Malawians. These fringes are usually involved in menial jobs in the care industry, as domestic workers or the reputational hard workers in factories of the modern world. Many of them survive on hand-to-mouth piety, while many others are undocumented and would rather invest their earnings in evasion of the law in a world characterized with increasingly intolerant immigration policies. In addition, for individuals and families that will have secured a livelihood abroad, the continuous freefall of its economy and deterioration of social values and security, there is little appetite to look towards Malawi as a place of hope and dreams. That is usually followed by a hesitation to direct significant resources, individually or jointly, to productive market activities. And the high likelihood that foreign earnings would be the prey of corrupt politicians, who worship appearances above public service, worsens the extent to which potential Malawian foreign investors will fret.
So, a diaspora policy that may be geared towards adding up the few Dollars, Pounds and Rands (probably the most-associated with Malawians) to boost the country’s foreign exchange position may work at best as a contingent national financial plan. The bulk of these resources still percolate irregularly through the economic system. It is unlikely that the sum of remittances to Malawi will induce production in factories, the generation of electricity, or the construction of roads any time soon. As if this were not enough, there is a minimal anticipation of a sustainable positive return. And looking back at our article of 26 June 2017, our argument on the business environment remains a complex, but fundamental question that government needs to lead Malawians to answer so that inflows of remittances can be put to meaningful use.
So, Mr. Mutharika will have a great job to do to capture the full potential of global remittance flows for Malawi. Mr. Gondwe, as gatekeeper of finances and lead budgeter, will need to earn a trust we hope has not been lost for good. For the speedy growth of remittance flows not only to Malawi but to the rest of the world is an indication that there is still more where they come from, which can change Malawi in substantial ways.