Libmonster ID: UZ-875
Author(s) of the publication: Zulaykho Kadirova
Educational Institution \ Organization: Tashkent State University of Economics


Since the beginning of the XXI century, the Republic of Uzbekistan has been experiencing an increase in outgoing labor migration. The article examines the long-term economic consequences of labor exports on the example of the Philippines and Morocco, which are among the leading labor exporters and are comparable to the Republic of Uzbekistan in many social and economic parameters. The article offers economic and social measures of labor resources management for the Republic of Uzbekistan.

Keywords: labor migration, labor force export, money transfers, migration policy, net migration, re-emigration.

When the Republic of Uzbekistan gained national independence and became a full member of the world community, it made it possible to independently develop and implement national policies, taking into account the trends of internationalization and globalization of the economy. But at the same time, there was a need to develop a new conceptual framework for the national employment promotion program, which would take into account the peculiarities of the country's socio-economic and demographic development.

The integration of the Republic of Uzbekistan into the structure of various world organizations makes it possible to successfully solve various problems related to promoting employment and labor migration by joint efforts.

In this regard, the creation of new jobs in various regions of the Republic of Uzbekistan and the full involvement of the working-age population in the formation of a new labor market that meets international standards is considered one of the main and priority tasks. Problems related to the management of labor migration processes and the impact of labor migration on the functioning of the labor market are becoming particularly relevant.

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Table 1

Key economic indicators of the Philippines, Morocco and Uzbekistan (2014)





Total population (million)




Annual population growth (%)




Number of migrants who left the country (millions)




Ratio of the total number of migrants to the population (%)




GDP (billion US dollars)




GDP per capita

2 870

3 103

2 037

Dynamics of annual GDP growth (%)




Total exports (USD billion)




Total imports (billion US dollars)




Foreign direct investment (USD billion)




Net cash transfers (USD billion)



5.5 (only from the Russian Federation)

Source: World Bank data.


** Data from the Moroccan Consulate and statistics of recipient countries.

*** According to the UNICEF (Uzbekistan Migration Profile) data for 2013 - For comparison, according to data published in the Demographic Yearbook of Uzbekistan for 2014, the number of Uzbek citizens who left the country was 184 thousand people.

**** World Trade Organization (WTO) data -< /i>

As part of the study of these problems, it is necessary to comprehensively study the interests and especially the motives of population groups prone to migration and, based on the knowledge gained, develop scientifically based conceptual foundations for national migration policy, identify mechanisms that allow effective implementation of the developed policy, and take into account the diverse world experience.

In this article, we highlight the experience of individual countries that are comparable to the Republic of Uzbekistan in terms of their level of economic development, demographic indicators of the scale of labor exports.

In recent years, as a result of natural population growth and due to increased internal migration, the number of working-age people has increased.

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The population of Uzbekistan is steadily growing, which is why the problem of rational use of labor resources concentrated in the central regions of the country is becoming particularly important. The growth dynamics of the working-age population significantly exceeds the growth dynamics of the number of new jobs. Both the dynamics of the number of labor resources and their distribution in different regions of the country and in different sectors of the economy, and especially the dynamics of the efficiency of using labor resources, are very specific. Due to natural population growth, the proportion of young people in the population is high. The republic has a sufficient number of workers necessary for the development of cotton growing, karakul growing, gas production, non-ferrous metallurgy, chemical industry, mechanical engineering, serving cotton growing.

There are also reserves for external labor migration. It is well known that migrant workers ' remittance flows to developing countries largely help to stabilize and improve the economic situation of these countries and serve as one of the main factors contributing to the strengthening of the national financial system.

With this in mind, we decided to study the experience of cash flow management in developing countries such as the Philippines and Morocco, whose economies are very similar to the state of the economy of the Republic of Uzbekistan. These countries are very close to the Republic of Uzbekistan in terms of such key indicators as the level of economic development, the size of the territory, the number and dynamics of population growth, the share of migrant workers in the population, and the share of remittances in GDP.

Philippines. This country exceeds the Republic of Uzbekistan in terms of population by 3.2 times, and in terms of GDP-by 4.9 times. However, indicators such as the percentage of the total number of migrants to the population and the degree of dependence of the economy on remittances are almost identical.

The Philippines ' policy of State support for labor exports and protection of migrant workers is considered very rational and successful. The State policy on supporting the export of labor and protecting migrant workers is based on the regulatory document "On Migrant Workers and Filipinos Abroad"adopted in 19951. In this fundamental document, the Government sets out the following economically important goals and objectives::

* End illegal migration. To achieve this goal, it was decided to publish the terms of employment in the mass media every month. To provide support to labor organizations

1 Kevin O'Neil. "Labor Export as Government Policy: The Case of the Philippine". Migration Information Source. Washington, D.C.: Migration Policy Institute, January 1, 2004.

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A special "Fund to guarantee the debt obligations of labor migrants" was created for migrants.

Providing effective assistance to migrant workers. To achieve this goal, a special "Rapid Repatriation Fund" was established, whose functional responsibilities include providing effective assistance to Filipinos who are abroad in emergency situations, in cases of man-made and natural accidents in the recipient country.

Providing full support to migrant workers in the recipient country. In particular, the provision of legal protection, medical assistance, consultations, assistance to labor migrants upon their return to their historical homeland in their adaptation, retraining of personnel (qualification trainings). In addition, a system for monitoring the daily life of migrant workers in the recipient country has been established. For this purpose, a special structure was created - the "Resource Center for Migrant Workers working abroad".

Full support for reintegration. In particular, it was decided to develop and implement various programs to support and assist in the employment of migrants. Special monitoring centers have been set up for this purpose.

According to the Committee of Filipinos Abroad, the number of labor migrants from the country in 2013 was 10,238,614. Labor migrants from the Philippines mostly travel to the United States, Saudi Arabia, the United Arab Emirates, Canada and Malaysia. The majority of migrant workers are nurses, teachers, and engineers. Opinion polls showed that 1/3 of Filipinos expressed their willingness to travel abroad at the earliest opportunity.

Between 1990 and 2014, the volume of remittances from migrant workers increased more than 19-fold and amounted to 28.4 billion US dollars. In 2014, the volume of money transfers from abroad amounted to 10% of the country's GDP. This figure is 4.6 times higher than the volume of direct investment in the country.

The export of labor has had a certain positive effect on the country's economic development. In particular, it manifested itself in the fact that the country's reserves in foreign currency increased significantly; the balance of payments changed, gaining a positive value; close relatives of migrant workers who receive money from abroad opened their own private businesses in the form of small businesses; due to cash receipts, many students in the country were able to fulfill their contractual obligations. obligations to educational institutions; migrant workers who returned to the country were able to benefit from the benefits they received.

1 http://www.

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Figure 1. Total remittances to the Philippines (USD) US$)

Source: World Bank data.

abroad skills and knowledge. In addition, cash injections into the national economy have positively affected the increase in capital investment in housing construction, and have given a new impetus to the development of domestic tourism.

We were interested in the question of how the positive effect of labor exports, which we described above, will affect the country's economic development in the long term. To do this, we made a comparative analysis of the main indicators of economic development of the Philippines and neighboring countries in the region. For comparison, the countries of the region that are similar to the Philippines in size, level and structure of the national economy were selected, namely: Indonesia, Vietnam, Malaysia and Thailand.

The following statistics indicate that the Philippines ' economic development is not particularly successful when compared with other countries in the Asia-Pacific region. Take for example one of the main economic indicators - GDP per capita. This figure in the Philippines in 2014 compared to 1990 increased 4 times. While the same indicator, for example, in Malaysia shows an increase of 4.5 times, in Indonesia by 5.5 times, and in Vietnam by almost 21 times. Only in Thailand, GDP per capita growth was lower than in the Philippines, showing a 3.6-fold increase.

Despite the fact that every year a very large number of labor migrants leave the Philippines abroad, the country's unemployment rates are still high. This figure in the Philippines is 6.8% and is the highest in comparison with the other countries named.

According to the National Statistics Committee, the main problem lies not in the unemployment rate, but in the fact that a very large number of people in the country are not fully employed.

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Figure 2. GDP growth per capita in 1990-2014

Source: World Bank data.

Figure 3. Unemployment rates in 2014 (%)

Source: World Bank data.

by labor. This is also evidenced by the following facts: while the unemployment rate in 2014 was 6.8%, the number of people who are not fully employed reached 20.9%. If we add the total number of people who are not fully employed to the unemployment rate, it turns out that almost 28% of the total working-age population of the country does not have full employment. In addition, one should take into account the fact that 1/3 of the country's working-age population is employed in the shadow economy.

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Judging by the studied facts, we can state that the export of labor force to a certain extent helped the government to solve some serious social problems, improve the country's balance of payments, and stimulate consumption, but in the long run it did not allow achieving successful economic growth.

According to Prod Lakwain, a professor at the University of Human Resource Planning in British Columbia, one of the most serious and negative consequences of the current migration policy in the Philippines is that it is relatively easy to handle money transfers from abroad. This factor negatively affects the prospects for national economic development of the country, as under these conditions the government of the country does not pay enough attention to the development (modernization) of national production, infrastructure, agriculture, mining and strengthening the export potential of the economy. Moreover, under the current conditions, the country cannot actively attract foreign investment in country1. Prod Lakwain's statements are true.

It should also be noted that due to the fact that the monetary income of labor migrants is not taxed by the state, the state budget does not receive serious material resources that can potentially serve the interests of economic development. Due to the prevailing conditions, a huge number of migrant workers who have left the country do not participate in creating added value within the national economy, and potentially possible value added is not taxed, money does not flow to the state treasury. Thus, the Government of the country loses many potential opportunities for development due to its irrational policies. In the Philippines, tax revenues to the state budget are equal to 14.5% of the country's GDP. This indicator is the lowest among the countries compared (statistics for Vietnam for 2005-2012 and for Indonesia for 2012 are not available).

The Government of the country does not have enough capital resources for the development of the national economy, its technological modernization, infrastructure development, and improvement of social living conditions. Consequently, due to rather low incomes, the state cannot implement large-scale social projects that require large capital investments. Under these conditions, the state will be forced to increase the amount of taxes.

Relatively high tax rates do not favor an increase in direct investment. In turn, relatively low foreign direct investment does not allow increasing the production potential, and for objective reasons, the country cannot


page 102

Figure 4. Tax revenue as a percentage of GDP (%)

Source: World Bank data.

Figure 5. Average tax burden of companies in the period 2005-2014 (in % of revenue)

Source: World Bank data.

improve your investment attractiveness. Thus, because of these circumstances, the Philippines is significantly less competitive than other countries in the Asia-Pacific region.

Foreign direct investment in the Philippines accounts for only 1.4% of the country's GDP. Compared to other countries that we compare, this is the lowest level. Vietnam's share of foreign direct investment in the country's GDP is 6.2%. This indicator is the highest among the Asia-Pacific countries that we compare. Apparently, due to the high level of foreign direct investment, Vietnam shows a high level of GDP growth per capita for the period from 1990 to 2014 (20.9 times).

The Philippines, as a labor-exporting country, is trying to solve some social problems through remittances from migrant workers. Along with this, the country is actively trying to encourage

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Figure 6. Foreign direct investment as a percentage of GDP (average for 2005-2014)

Source: World Bank data.

domestic consumption and increase the country's balance of payments. In the short term, these problems can be solved, but in the longer term, this problem may remain unresolved.

Experience shows that in the long run, a country that has managed to solve the problem of creating new jobs and thus stimulated the development of production (while other factors affecting the situation should remain unchanged) will be able to significantly improve its economic situation relative to those countries that continue to depend on labor exports.

Morocco. It is considered one of the leaders in terms of money transfers on the African continent.

The geographical location and ancient historical ties with Western European countries have greatly contributed to the development of labor exports. To date, Moroccan diasporas have emerged in foreign countries, making up a total of 10% of the total population of Morocco.

The history of labor migration from the country began during the colonial dependence on France. It was in 1912-1956 that labor migration increased significantly. At that time, Western Europe was experiencing rapid economic growth and needed cheap, low-skilled labor. In 1962-1972, the growth rate of labor migration from Morocco to Europe sharply increased. During this period, a number of Western European countries (Germany, France, Belgium and the Kingdom of the Netherlands) signed interstate agreements on labor recruitment. Since that time, the Moroccan Government has been actively developing a labor export policy. At the beginning, the Moroccan Government considered the export of labor as a temporary measure to help defuse the social situation. Moreover, it expected that migrant workers going abroad would be able to improve their professional skills there.-

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They will be able to acquire new skills, acquire up-to-date knowledge, and then return to their homeland to invest the acquired knowledge and skills in the business and thereby contribute to the modernization of the national economy. But it turned out the opposite. Migrants who left the country did not return to their historical homeland. The case was aggravated by the oil crisis that occurred in 1973. The country is experiencing economic instability. This has become an additional incentive for those who want to leave the country. Earlier, migrants who left the country began to call their family members. The trend towards family reunification abroad has begun to gain momentum. As a result, the total number of migrants abroad has steadily increased. Between 1972 and 2014, the total number of migrants leaving Morocco increased more than 10-fold, from 300,000 to 3.4 million. 1

Along with external factors, some internal factors also influenced the activation of migration processes. Since ancient times, the majority of the population of Morocco lived in rural areas. If in 1961 the total share of the population living in rural areas was 71% of the population, by 2014 this figure had fallen to 43%. Despite the fact that the majority of the population is made up of rural settlers, the level of development of the agricultural sector is extremely low. The share of the agricultural sector in Morocco is 16% of the total gross domestic products2. Extremely high unemployment and lack of opportunities to create new jobs are forcing young citizens of the country to emigrate more and more actively abroad.

Even after gaining sovereignty, the Government of Morocco, taking into account the economic and political situation in the country, continued to pursue a policy of encouraging the export of labor resources abroad. The Government saw the export of labor as a real opportunity to reduce socio-political pressure within the country. Migration in many ways reduced the political tension that was gaining strength within the country, and gave politicians the opportunity to neutralize the politically active part of the youth to a certain extent, offering them the opportunity to earn money abroad.

In Morocco, labor emigration was carried out over several periods. The first wave of labor migration occurred between 1968 and 1972. During this period, the economy of Western Europe experienced rapid development and large quantities of cheap labor were required. Then 588 thousand labor migrants left Morocco.

In the 1990s, Western European countries significantly tightened the visa regime, but, despite this, in the period from 1988 to 1992 from Ma-



page 105

611,000 migrant workers left Rocco. This is how the second wave of migration took place. Over the years, migrant workers who left Morocco have called in their family members. Moreover, the older children of the first wave of migrants began to start their own families, finding a husband or wife from the diaspora formed in a foreign country.

The third wave of migration from Morocco spanned the period from 1998 to 2002. This event was largely caused by the drought, which caused economic stagnation in the country for a long time. The total number of labor migrants of the third wave reached a record number-755 thousand people.

By 2003, the total number of migrant workers from Morocco reached 2.5 million, representing 8% of the country's total population.

In the following years, the number of labor migration from Morocco began to gradually decrease, which can largely be explained by the economic stabilization in the country. The economic situation in the country has improved so much that there are cases of labor migration from Spain to Morocco.

According to Morocco's Supreme Planning Committee, the total number of Moroccan citizens living abroad has reached 3.4 million. This is 10% of the total population of the country. 86% of all labor migrants from Morocco live in Western Europe, 1/3 of migrants settled in France. This can probably be linked to the colonial past of the donor country. French is considered the second official language in Morocco and is widely used in government agencies, the media, in the business environment, and in the field of international diplomacy.

Remittances from migrant workers, just as in the Philippines, play an important role in Morocco's economic growth. In 2001, the total volume of remittances of migrant workers from abroad was 6 times higher than the amount allocated for development, 5 times the volume of foreign direct investment, and several times higher than the amount of income received from tourism or agricultural exports.

In 2004, the country ranked fifth among developing countries in terms of remittances received from abroad (US $ 4.2 billion). In 2014, remittances from migrant workers totaled $ 6.8 billion. This was almost 7% of the country's GDP.

It should be noted that despite the fact that the total volume of remittances of migrant workers in Morocco increased 3 - fold in 2006-2014 compared to 1990, the share of remittances in GDP remained at the same level (6.8-9%). This is largely due to the stable growth of the country's nominal GDP.

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Figure 7. Total remittances of migrant workers in Morocco (in US dollars)

Source: World Bank data.

Figure 8. Total remittances of migrant workers to Morocco (in % of GDP)

Source: World Bank data.

In addition to money transfers, Moroccans from abroad send their families various goods in kind (for example, household utensils, furniture, cars, clothing). In-kind transfers account for 25-33% of all transfers. Also, labor migrants from Morocco invest their capital in the national economy of their historical homeland. Non-residents who leave Morocco invest 80% of their investments in the construction sector.

It is obvious that the analysis of labor export trends should be linked to the dynamics of the main indicators of the country's economic growth. The country's nominal GDP grew 5-fold between 1980 and 2012 (from $ 18.8 billion). GDP per capita increased 3-fold (from 943 to 2902 US dollars). As can be seen from the figure below, the country's GDP dynamics have been growing mainly since the 2000s. This was largely facilitated by foreign transfers and investments of migrants.

page 107

Figure 9. Morocco's GDP per capita (in US dollars)

Source: World Bank data.

Here again, it is appropriate to ask the question: how will the country's attachment to money transfers from abroad affect economic development in the short and long term?

Let's compare the dynamics of economic growth of the country - exporter of labor-Morocco and the main recipient countries-France and Spain. Data analysis shows that although Morocco's GDP per capita has generally tended to grow over the period under review, the growth rate is still lower than in the recipient countries. Thus, from 1960 to 2014, Morocco's GDP per capita grew from US $ 165 to US $ 3,103 (i.e., an increase of 18.8 times). The same indicator in France increased from $ 1,343 to $ 39,746 (i.e., an increase of 31.9 times). In Spain, GDP per capita increased from US $ 396 to US $ 28,274 (i.e. an increase of 76.3 times).

It should be noted that in the initial period, the dynamics of economic growth in the observed countries were different. During these years, Morocco's GDP per capita was significantly lower than that of France and Spain. This essentially makes the gains in per capita GDP growth in Morocco even less attractive, since, as a rule, economic growth in developed countries is much less intense than in developing countries.

The impact of migration on reducing unemployment in Morocco is not clear. Until the 2000s, the unemployment rate remained very high and usually exceeded 15%, i.e., active labor exports before 2000 failed to ensure low unemployment. Only by the mid-2000s, the growth rate of unemployment rates fell just below 10% and was comparable to that in France. Spain experienced a credit crunch during this period, and as a result of its impact, social spending was significantly reduced. As a result, the unemployment rate rose to 25%.

page 108

Figure 10. Dynamics of unemployment growth (in %)

Source: World Bank data.

Notably, the decline in Morocco's unemployment rate coincided with a period when the country's labor exports declined sharply.

Between 1990 and 2000, the Moroccan Government managed to achieve economic stabilization in the country, some progress was observed in the field of foreign trade liberalization, and significant progress was made in the development of tourism. As a result, the share of exports in the country's GDP increased from 22% (in 1980) to 35% (in 2014). Due to the policy of "open doors" and strengthening the processes of international economic integration, the country has become more attractive for foreign tourists. In this regard, in 2014, the country received 8.2 billion rubles from the treasury due to international tourism. US dollars. This was equal to 9% of the country's GDP. Since that time, the level of cash receipts from international tourism has exceeded the volume of remittances from migrant workers.

Summing up, we note several important consequences of the migration policy implemented by the Moroccan Government:

* the vast majority of more or less qualified personnel have not returned from emigration;

* for many years, the problem of unemployment persisted and was quite acute in the country, and the reduction in the unemployment rate was achieved not by increasing labor exports, but by economic integration of the country and the development of tourism;

* the growth rate of the national economy remained low compared to that of the recipient countries.

Conclusions from the experience of labor-exporting countries. We would like to emphasize the imperfection of judgments about some of the supposed benefits of exporting labor:

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1. The thesis that labor migration is temporary is not entirely justified. Using the example of Morocco, we could see that labor migrants who went abroad to earn money not only did not return to their historical homeland, but later took their families and sought opportunities to obtain the right to reside. The emergence of the diaspora made it possible to strengthen ethnic ties abroad and thus create conditions for a new wave of labor migration.

2. The thesis that the export of labor, and as a consequence, systematic remittances of labor migrants, will stimulate high economic growth, is not justified. We do not deny that remittances from migrant workers significantly improve the financial situation of households, but they cannot guarantee high economic growth. Since labor exports mainly cover the working-age population, migration in the donor country reduces the number of working-age people involved in value-added processes, and reduces state revenues. Moreover, large-scale labor exports distract the Government's attention from attracting foreign direct investment, which would greatly help create new jobs in the country.

3. The thesis that the export of labor will reduce the growth rate of unemployment is not confirmed. Labor migration can reduce the severity of the problem of unemployment only for a relatively short period. The Philippines has the highest unemployment rate compared to neighboring countries, while Morocco has long had an official unemployment rate of 15% or more. Moreover, labor migration can increase latent forms of unemployment, as seen in the Philippines, where underemployment is about 21%.

In addition to the economic results of labor exports, many negative social consequences should be noted:

* the relatively long separation of family members can eventually lead to a breakdown in family relations and even family breakdown;

* demographically, relatively long-term separation of family members can eventually lead to a natural decrease in the birth rate growth and to an increase in the number of elderly and disabled people in the demographic structure of the population;

* the lack or lack of attention in the family to children can lead to the fact that children begin to show signs of deviant behavior, they may start taking drugs or enter into a criminal path.;

* people who regularly and long enough perform "dirty and dirty" work abroad, live and work in unsuitable conditions.

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They may end up getting sick or even bringing dangerous diseases into their country, which can then pose a threat to society.

Recommendations for reducing the degree of dependence on the export of labor of the Republic of Uzbekistan. It is obvious that immediately stopping the export of labor is not an optimal solution due to the existing strong dependence of the country's economy on remittances. Nevertheless, a number of measures should be taken to reduce the export of labor and make better use of the Republic of Uzbekistan's labor resources to improve the long-term well-being of the population. Based on the above, we can draw the following conclusions:

1. It is necessary to encourage internal migration as opposed to external migration. Labor resources will bring more benefits to the country if they are used to create added value in the country itself. This may require actively developing urban development processes, urbanizing life in rural areas, and stimulating the creation of new jobs.

2. It is necessary to improve the investment climate to attract direct investment. To do this, it is advisable to reduce the total amount of tax burdens, increase the efficiency of the banking sector, minimize the degree of state intervention in the economy, and simplify tax and customs legislation.

3.Mainly people who do not have high qualifications go abroad, and therefore potentially "laborers" from rural areas, it is necessary to develop entrepreneurship and small businesses in the agricultural sector and rural infrastructure more actively. The Government should pay special attention to the development of agricultural business, thus solving the problem of employment at the regional level.

4. The service sector's share of GDP in developing countries is much lower than in developed countries. This fact, in our opinion, clearly demonstrates the development potential of the service sector and provides an opportunity to identify another important opportunity for economic growth. The development of the service sector can reduce the tension in regulating migration processes.


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