Are remittances harmful?

[Yukon_Niner]

The book on the Somali diaspora's I was reading talked about the pressure Somalis in the US faced in having to send back remittances while being paid extremely low wages with horrible job prospects due to lack of af-ingriis. Not only that, apparently Somalis back home expect much more from somalis in the west due to their own perceptions of it.

An anecdote by one guy compared it to Diya as Somalis in the west sacrifice their kids prospects while putting a massive financial strain on their immediate family in order to appease/feed those back home. So much so that apparently the vast majority of the minority middle-class actually rarely remit back home.

Do you guys agree with this?

 

[Hoofan]

From how i see it's usually the 1st generation and people who actually been to Somalia and have good relations with relatives.

The 2nd generation has no affiliation whatsoever and the more educated people with higher earnings seem to live abide two different cultures and have no sense of connection with the wider family back home.

Your theory is right in that it usually is the ayuuto holders that sends the most yet earns the lowest.. *Keep in mind that most Somalis are dependent on it*

If it wasn't for the 2016 great migrant influx in Europe some Somalis would not secure ayuuto for the coming two decades and the older senders would have been too old as their own kids would not want to take upon that burden.

•Disclaimer• Monthly remittances

 

[Djokovic]

Nothing wrong with remittances only retards say it is harmful without remittances no one in Somalia would have an education

 

[butANumba]

I am second generation and I send remittances back home stop making blanket statements

where were you born

 

[Hoofan]

I am second generation and I send remittances back home stop making blanket statements

Sxb listen, I wrote 1st generation, ppl who have been to Somalia or those who have relation back home...

Then about 2nd generation and it takes anyone with a brain to figure it out.

 

[Ras]

1. It's cuts down on savings for the Diaspora that send over money.

This leads to lower wealth growth. $200/month over 25 years at a 6% growth rate returns $135,000.

That's more than enough to move most households to the middle class level if it's invested in education or their own business.

2. It removes any incentives for the most capable demographic back home to work for a living and hence increase the economy.

If you know anything about the velocity of money you'll know that different economic activities have different levels of multiplier effects.

$1 in remittance only doubles twice at most... I.e. it goes to essentials which are imported and a small part to local services.

However $1 gained through employment touches many parts of the economy like all the suppliers in their jobs supply line, logistics and most importantly taxes which get redistributed further (with proper governance).

Economies don't grow simply due to foreign direct investments... It's about how much productivity you get out of your resources which in this case I'm referring to capital.

 

[Djokovic]

where were you born

One of them Scandinavian countries

 

[Ade]

I believe it has a bad impact in the long run. Imagine that you continue to do this and we all know how donation and corruption is a big factor in where our country is today.
When we let remittances have the impact as it have today it's like we only care about our own qabil / family and close our eyes to corruption. Every week I can read about how parents in this country have a sick child and need help with money. Somali have to be solidarity to eachother. If we solve the "problem" of remittances, we may also be able to overcome the poverty and criminality in the western world that most young men are often drawn into, I think

 

[Jiron]

It is for some and it's not for others.

There are people back home who don't want to work and if offered employment will refuse it because the job is beneath their status. However they will call every month and demand money.

I hope they are in the minority because there are also people who really need the assistance to survive, We all know the situation back home and I love when we get together in the community to help out people who are needy.

It's tough question but I would rather pay hoping it is going for a good cause

 

[Ade]

I also know that remittances can have a very bad psychological impact for the payer
which many forget. Life can be tough and anything can happen

 

[AbdiGeedi]

Remittance vs Diaspora Direct Investment.

I wonder which one outweighs another.

 

[mrlog]

1. It's cuts down on savings for the Diaspora that send over money.

This leads to lower wealth growth. $200/month over 25 years at a 6% growth rate returns $135,000.

That's more than enough to move most households to the middle class level if it's invested in education or their own business.

2. It removes any incentives for the most capable demographic back home to work for a living and hence increase the economy.

If you know anything about the velocity of money you'll know that different economic activities have different levels of multiplier effects.

$1 in remittance only doubles twice at most... I.e. it goes to essentials which are imported and a small part to local services.

However $1 gained through employment touches many parts of the economy like all the suppliers in their jobs supply line, logistics and most importantly taxes which get redistributed further (with proper governance).

Economies don't grow simply due to foreign direct investments... It's about how much productivity you get out of your resources which in this case I'm referring to capital.

Agree 100%
That’s why I don’t send a penny.
Would rather spend it on Henny and H.o.e.s

 

[TekNiKo]

Instead of sending money buy them a TukTuk or create a shop. This actually helps them earn their own money

 

[Basra]

The book on the Somali diaspora's I was reading talked about the pressure Somalis in the US faced in having to send back remittances while being paid extremely low wages with horrible job prospects due to lack of af-ingriis. Not only that, apparently Somalis back home expect much more from somalis in the west due to their own perceptions of it.

An anecdote by one guy compared it to Diya as Somalis in the west sacrifice their kids prospects while putting a massive financial strain on their immediate family in order to appease/feed those back home. So much so that apparently the vast majority of the minority middle-class actually rarely remit back home.

Do you guys agree with this?