Re-imagining Dependency an Ode to Unpopular Economics

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The relationship between migration and development has been a long-scrutinised topic of debate within developmental discourse. Understanding of these dynamics have “swung back and forth like a pendulum” (de Haas, 2010) since first emerging as an area of academic interest in the 1950s, oscillating from optimism to pessimism and back again.

Early perspectives attached to modernisation theory highlighted the potential for migration to catalyse a ‘developmental take-off’ for sending nations by way of remittance and skill transfers. Later, radical critiques (from neo-Marxist and dependency perspectives) re-framed migration-development in a profoundly sceptical light, emphasising migration’s propensity to siphon skills and labour in a way that stymies genuine economic development in sending countries. Since the ‘rediscovery’ of the migration-development nexus in the early millennium the tone of discussion has once again been overwhelmingly hopeful; a solidifying neo-liberal status quo has drowned out the radical critiques of the 70s and 80s and shrunk the contours of development until a “golden straitjacket” (Friedman, 2000) woven of market signals is all that remains.

Within this neo-liberal development paradigm, the World Bank, IOM and fistfuls of Northern think tanks have promulgated the notion that temporary labour migration yields a ‘triple win’ scenario, in which sending countries, receiving countries and migrants all benefit from a re-allocation of global

labour ostensibly co-ordinated by forces of supply and demand. Meanwhile, alternative approaches to migration that emphasise the exploitative disparity of those ‘wins’ have been dismissed in parcel with the failed developmental projects with which they were ideologically aligned and are today something of a theoretical faux pas. Sri Lanka’s own experience with a closed economy highlights many of the problems of such developmental models, though it remains difficult to disentangle the culpability of economic theory from the social and productive vulnerabilities inherited from colonial occupation (Kelegama, 2006).

"What is remarkable about Sri Lanka’s current developmental predicament is its similarity with the woes of the post-independence economy: poor terms of trade, a precarious balance of payments and a failure to diversify from in-elastic agricultural and low value-added exports."

The global division of labour underpinning capital accumulation in the North is predicated not only on the outsourcing of production, but also the importing of workers for exploitative labour in care, construction and service roles that cannot be off-shored. Meanwhile, adherence to migration as a de-facto developmental strategy has left Sri Lanka increasingly dependent on remittances as a means of shoring up its foreign reserves (a staggering 49% of export earnings) to counterbalance a historically impregnable trade deficit, keep the rupee afloat and subsequently finance the ongoing gentrification of urban Colombo. Where national development projects and attempts at export diversification have failed, migrants have picked up both the foreign exchange slack and the suffix of ‘hero’ (MFEPW, 2011). Worse again, with remittances failing to translate into sustainable long-term livelihoods for migrant families, some of the most vulnerable portions of Sri Lanka’s population are coaxed into an unsustainable cycle of repeat migration to attain a transient reprieve from poverty.

Two critical observations emerge from this picture. The first is that economic development should be conceptualised in relative, not absolute, terms; if sending countries gain from migration these modest ‘wins’ need to be juxtaposed with the more substantial gains enjoyed by receiving countries. In this context, portraying temporary labour migration from South to North as a pathway to ‘development’ is analogous to confining the poorest strata of a nation to the least-stable, worst-paying jobs and expecting them to converge upon the rich. Contrarily, deepening economic inequality between the ‘developed’ and ‘developing’ (Cornia, 2004) only corroborates dependency theorists’ concerns about the structural underdevelopment of a global periphery at the behest of a wealthy capitalist core and migration needs to be understood as a facet of this growing divide.

The second observation is that we need to start questioning the assumed causality of ‘migration-development’ altogether: rather than migration leading to development, it appears far more tenable that under-development itself leads to migration (Wise and Covarrubias, 2009). In Sri Lanka huge swaths of the rural population have found themselves starved of local employment opportunities as a consequence of Jayewardene’s neo-liberal revolution and the resultant concentration of economic activity in Colombo and its nearby Export Processing Zones (EPZs). Without a plan for export diversification, industrial policy or otherwise providing widespread and decently remunerative employment for all Sri Lanka, chronic rural underdevelopment is fuelling forced economic migration as a means of survival. That remittances are channelled back into the rural economy means little when there are insufficient economic foundations for investment in value-added production.

What is remarkable about Sri Lanka’s current developmental predicament is its similarity with the woes of the post-independence economy: poor terms of trade, a precarious balance of payments and a failure to diversify from in-elastic agricultural and low value-added exports. The main difference today is that migration and garment production provide relief valves for unemployment and foreign exchange earnings, though neither are sustainable. The once-lucrative garment industry was dealt a substantial blow with the end of the Multi Fibre Agreement (MFA) and is now poised to become hollowed out by cheaper labour saturating the market, while temporary labour migration continues to violate the human and working rights of dis-privileged Sri Lankans without providing viable livelihoods. The ‘Re-imagining’ series by the Centre for Poverty Analysis (CEPA) is intended to be a forum to communicate diverse perspectives on development. CEPA is an independent, Sri Lankan think-tank promoting a better understanding of poverty related development issues. We encourage you to submit your comments and responses to the article on this column via email: info@cepa.lk and to follow further conversations on related topics please visit www.reimagining.cepa.lk

The Centre for Poverty Analysis (CEPA)

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Re-imagining Dependency an Ode to Unpopular Economics

"What is remarkable about Sri Lanka’s current developmental predicament is its similarity with the woes of the post-independence economy: poor terms of trade, a precarious balance of payments and a failure to diversify from in-elastic agricultural and low value-added exports."

The Centre for Poverty Analysis (CEPA)

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