REMITTANCES AFTER ETHNIC CONFLICT: A CASE STUDY ON BURUNDI

1. REMITTANCES AFTER ETHNIC CONFLICT: A CASE STUDY ON BURUNDI IS-Academy Migration & Development: A World in Motion Sonja Fransen, PhD Candidate OECD July 2011

2. Presentation overview • IS-Academy Migration & Development • The country context: Burundi • Remittances after conflict: previous studies • The fieldwork in Burundi • Methods & sampling • Preliminary results • Overall findings: an overview

3. I. IS Academy Migration and Development: A World in Motion

4. The IS-Academy Project • Overall research question: • What is the relationship between migration and development and how can the positive effects of migration be enhanced? • Objectives of the research: • To strengthen the scientific foundation for M&D policy making & the policy relevance of research in the area of M&D • Research themes: • Remittances, development and poverty allevation • Brain drain and development policy • Return migration in the life cycle of migrants • Migration and development in EU policy • The external dimensions of EU migration policy

5. The IS-Academy Project • Overall research question: • What is the relationship between migration and development and how can the positive effects of migration be enhanced? • Objectives of the research: • To strengthen the scientific foundation for M&D policy making & the policy relevance of research in the area of M&D • Research themes: • Remittances, development and poverty allevation • Brain drain and development policy • Return migration in the life cycle of migrants • Migration and development in EU policy • The external dimensions of EU migration policy

6. II. The Country Context: Burundi

7. Burundi • Waves of civil conflict (1965, 1972, 1988, 1991, 1993)- ‘fragile state’ and ‘low-income’ country (WB, 2011)- Large refugee flows- Substantial diaspora - Government interest in diaspora involvement in reconstruction processes

8. Net migration rates 1950 - 2010

9. At a Glance: The Burundian diaspora Stock of emigrants: 356,000 % of population: 4.1 Top destination countries: Tanzania, Uganda, Rwanda, Belgium, Canada, NL, UK, France, Australia, US Stock of immigrants: 60,800 % of population: 0.7 Top destination countries: Rwanda, DRC, Tanzania Source: World Bank, 2011 • Burundian diaspora: • mostly relatively highly educated 1972 or 1993 caseload refugees • increasing flow of Burundian students to Europe and US • However: • difficult to estimate the exact size of the diaspora and the characteristics of the diaspora members

10. At a Glance: Remittances in Burundi I Remittances (million US Dollars): 2003 - 2010 Compared to other countries in the region

11. At a Glance: Remittances in Burundi II International transfers (million US Dollars): 2005 - 2010

12. III. Remittance flows and impact after conflict: What do previous studies tell us?

13. Remittances after conflict • Remittances systems and flows • Remittance systems tend to adapt to changing circumstances (Lindley, 2009) • Remittance flows tend to increase in times of crisis • Household level effects: • High level of dependence on remittances during and after conflict (Fagen & Bump, • 2006; Lindely 2008) • Function as a substitute for failing government support (Maimbo, 2007) • Country/regional level effects: • Contribution to economic development/reconstruction • Risk of stimulating inequality levels (Van Hear, 2004) • Gaps in the literature: • There is still little empirical evidence on remittances flows after conflict • And the effect of remittances on households in conflict-affected societies • - Lack of (micro-level) data • - Focus in remittance literature on labour migration

14. IV. The fieldwork in Burundi (Jan. – April 2011)

15. Fieldwork in Burundi • Methods:- National household survey (n = 1500)- Urban household survey (n = 810) - Community survey (n = 154)- Anthropometric measurements (height and weight) • - Qualitative interviews • Local research partner: • Universite s’Agesse d’Afrique • Practical support • Development Through Expert Consultancy (DevEC) • Logistics, interviewers, data management, etc.

17. Anthropometric measurements: Measuring and weighting one randomly selected child under the age of five in the household and his/her mother to check for malnutrition

18. Sampling of households: National household survey • - PSU = sous-colline (smallest administrative unit in Burundi) • - three-staged design • 1. Distribution of collines (2nd smallest adm. unit) over provinces • based on the demographic weight of the provinces • 2. Within-province selection of collines proportionally to population • size • 3. In each colline, one sous-colline was randomly chosen • - households in the sous-collines were randomly selected from • household lists provided by community leaders • Total: 100 sous-collines selected, 15 interviews per sous-colline

19. Surveys conducted (national survey)

20. V. Preliminary Results

21. The remittances market in Burundi Main players: • Banks & MTOs • Microfinance organizations and diaspora initiatives • Telecom providers • Informal channels Recent trends: • Fast growing formal market • Growing internal remittance market • Growing diaspora investments in e.g. construction sector, business, etc.

22. International remittances International remittance receivers • National household survey: • 2.6% of households (n = 39) received international remittances • Most of these households live in urban areas • Urban household survey: • 17.3% of households (n = 140) in Bujumbura received international remittances • Most of these households live in the richer neighborhoods, are relatively highly educated and have more wealth • Only 2 percent of households send international remittances

23. Households & remittances • Remittances are mostly send by family members (> 80%) • 65% of the households received remittances regularly • The average yearly amount of remittances received is 1700 US Dollar (+/- 122 US Dollar per month) • Remittances are mostly spent on • daily needs (food, drinks, etc.) • education • healthcare • to finance certain ceremonies (especially marriage)

24. Remittance flows & channels Remittance origins • Most remittances were sent from Europe, US, and Canada • Regional remittances were mostly absent Remittance channels • Most households received remittances through MTOs (>80%) • Banks are also popular (>15%) • Hand-carriers are only mentioned as a second option • Costs are indicated as the most important problem

25. Internal remittances Internal remittances • More than 30% of households living in Bujumbura sent remittances to households in the rural areas • More than 97% of these transfers are sent to family members • Informal transfers dominate (>80%) for these transfers

26. VI. Interesting findings: An overview

27. Overall findings • Development potential of remittances is small but growing in Burundi • Role for government to introduce remittance enhancing policies • Remittances market is changing rapidly • Rural-urban differences are substantial • Role for government to provide infrastructure • Remittances are substantial for receiving households but only reach a few • Implications for vertical inequality • Most remittances are sent along family (ethnic) lines • Implications for horizontal inequality >> further research will disentangle the relationships between remittances and development in Burundi

28. Thank you sonja.fransen@maastrichtuniversity.nl