INTEGRATED APPROACHES TO SUSTAINABLE DEVELOPMENT PRACTICE

1. INTEGRATED APPROACHES TO SUSTAINABLE DEVELOPMENT PRACTICE Policy Coherence: Migration, Trade, Aid, and Development Milena Novy-Marx, Ph.D. John D. and Catherine T. MacArthur Foundation February 26, 2008

2. Overview • 1. Impacts of Trade and Migration on Development • 2. Policy Coherence: Why it Matters • 3. Examples of Incoherence • United Kingdom and Migration of Health Workers • Philippines • Agricultural policy in wealthy countries • US, Mexico, and North American Free Trade Agreement • 4. Solutions • UK Commonwealth Code of Practice • Global Forum for Migration and Development 5. Conclusion 6. Discussion Questions

3. Impacts of Trade on Development • Presumption that freer trade promotes economic growth and development • Comparative Advantage • Increased efficiency • Freer trade will not promote growth absent basic founding conditions • Market imperfections in poorest countries • Lack of basic infrastructure, credit markets • Undeveloped human resources, disease burden, low agricultural productivity

4. Migration and Development • Worldwide: 200 million international migrants or 3% of global population • Increasing complexity of migration • Half of all migrants are women • Wage and demographic and imbalances between “North” and “South” create push and pull factors • Paradigm shift to potential positive impacts of migration on development • Lack of international regime for managing movement of people, protecting migrants’ rights

5. Impacts in Countries of Origin • Remittances totaled $206 billion in 2006 Foreign Direct Investment Development Aid Private Debt and Portfolio Equity

6. Impacts in Countries of Origin and Destination • Countries of Origin • Remittances – poverty reduction • Release pressure on local labor markets • Brain Drain • Diaspora: Transfers of Knowledge, Investment, Skills, Contacts, Philanthropy • Countries of Destination • Supply of needed labor (high and low-skilled) • Tax revenue • Multicultural vitality • Migrants vulnerable to abuse

7. Trade and Migration • Differences and Similarities between flows of goods and people • Complexity of migration due to human dimension • Gains from trade and migration are not evenly distributed

8. Policy Coherence: Why? • Policy Coherence is the systematic promotion of mutually reinforcing policy actions by governments • Policies on trade, aid, development and migration can be complements • Yet often countries’ policies work at cross purposes • Examples of policy incoherence: • United Kingdom’s (UK) health workforce • Philippines • Developed countries’ agricultural policy • US and the North American Free Trade Agreement (NAFTA)

9. United Kingdom: Health Workers • UK: Migration policy recruits Malawian nurses • UK’s aid agency provides aid to Malawi’s health sector • $120 million in 2004, $34 million for health in 2005 • Recruitment from other low-income countries (Africa)

10. Countries with critical health worker shortages • Eventually ethical guidelines established for recruitment by national health system

11. Philippines • Promoting emigration of doctors and nurses leads to a domestic shortage in health workers • Emigration as national development strategy has compromised some development outcomes • Decline in health standards • Dependence on remittance/migration model

12. Developed countries’ agriculture, trade, and aid policies • Organization for Economic Cooperation and Development (OECD) development assistance promotes trade and agriculture • Agriculture a key sector for many low-income countries • Yet OECD domestic agriculture and trade policies work at cross-purposes to these goals • Subsidies for agricultural production • Tariffs on agricultural goods from low-income countries • Increase in non-tariff barriers

13. US and Mexico: North American Free Trade Agreement (NAFTA) • US increased border enforcement to cut migration while the free trade pact increased it • NAFTA does not address migration, subsidies • NAFTA raised pressure for migration to US • Dislocation of farmers • In short-term, freer trade increases migration • In long-term, trade and migration may be substitutes

14. Migration Hump Source: Philip Martin, “NAFTA and Mexico-US Migration,” 2005.

15. A Policy Solution: United Kingdom • Commonwealth Code of Practice • Restricts recruitment by national health service • Innovative arrangements: hospital twinnings, training • Malawi • UK increases aid to country’s health sector for more training, higher salaries • Migration of nurses to the UK declines • Challenges: • Balancing right to move with health needs of poorest • Recruitment continues by private sector

16. Global Forum on Migration and Development • Nascent effort to coordinate policies on migration and development within and between countries • Inter-governmental and civil society meetings to exchange information and best practices • Non-binding • Governments establish focal points within Ministries • Next Forum in Manila October 2008

17. Policy Recommendations • Governments should: • Establish focal points or departments in Ministries • Develop formal consultations between Ministries/agencies • Developing national policies/plans for coherence • Incorporate migration and trade in Poverty Reduction Strategy Papers (PRSPs) • Improve international coordination • Many challenges remain: • Political commitment • Policy goals often unclear • Effective government institutions and administration • Financial and human resources • Private sector can complement or work against coherence

18. Conclusion • Better coordinated policies on aid, migration and trade can be complementary, creating synergies for development • Challenges to implementation

19. Discussion Questions • What are examples of policy incoherence in your country? • Has policy coherence improved in any areas? • Is policy coherence primarily an issue for developed countries? • What lessons can be drawn from the cases discussed? • How should development be defined and measured? By the well being of individuals from a country, regardless of residence? Or by per capita income of those remaining in-country? • Should individuals have the right to migrate?

20. Integrated Approaches to Sustainable Development Practice Policy Coherence: Migration, Trade, Aid and Development Lecture Milena Novy-Marx