Beneficiaries of IOM Ukraine’s 1+1 Initiative that supports migrant workers investment in economic development
The 2030 Agenda for Sustainable Development recognizes that migration is a powerful driver of sustainable development, for migrants themselves and their communities. According to its Global Vision, IOM strives to protect migrant workers and to optimize the benefits of labour migration for both the countries of origin and destination as well as for the migrants themselves.
In Ukraine, IOM supports the Government in harnessing the development potential of migration, particularly by creating incentives for migrants’ remittances investment and offering evidence-based policy advice to enhance labour migration management.
In 2018, according to the World Bank, Ukrainian migrants’ remittances amounted to USD 14.4 bln (almost double if compared to USD 7.4 bln in 2014). Moreover, as IOM study shows, 21% of Ukrainian migrant workers stated interest in investing in businesses and development projects in Ukraine. If effectively harnessed, migrant remittances could significantly contribute not only to poverty reduction, but to sustainable development in Ukraine. In the longer term, the professional and skills networks that develop through labour mobility can further stimulate productivity and growth. At the same time, rapid growth of labour migration is accompanied by growing risks of unethical recruitment, irregular employment and deteriorating working conditions for migrant workers, in worst cases resulting in human trafficking and labour exploitation. Vulnerabilities of low-skilled migrant workers are exacerbated by reliance on informal agents. According to the household survey conducted by the State Statistics Service of Ukraine in 2017, 76 per cent of Ukrainian labour migrants found a job abroad through informal channels and 62 per cent worked without an employment contract. This calls for greater effort to ensure protection of prospective migrant workers starting from the recruitment stage, as well as the need to strengthen institutional capacities in Ukraine and in key destination countries to optimize benefits of labour migration and address challenges of skilled migration.
PROJECTS AND INITIATIVES
Facilitating Migrant and Diaspora Investment in Ukraine
The project is implemented by IOM Ukraine in partnership with the PricewaterhouseCoopers (PwC) and with the support of the IOM Development Fund. Objective of the project is to contribute to the efforts of the Government of Ukraine to boost economic development through attracting and facilitating investments by Ukrainian migrant workers and diaspora into local businesses.
Ukrainian migrants make the largest external contribution to the Ukrainian economy, and, according to the National Bank of Ukraine (NBU), remittance transfers to Ukraine have grown 18 per cent compared to the previous year.
The project will develop policy recommendations and an action plan on how to enable migrant investments in Ukraine. The project will also identify the most relevant investment instruments to support Ukrainian migrant and diaspora investment in the country.
Development of innovative savings and investment instruments aims to better leverage the capital and skills of Ukrainian migrants and diaspora members to further contribute to the economic development of Ukraine.
The recommendations of the project will be informed by the interviews with experts from governmental, public and international organizations, legislative and market analysis, international good practices, stakeholder mapping and developed in close consultation with the Government of Ukraine and Ukrainian migrants and diaspora abroad. Coordination with the Government of Ukraine will secure commitment of the relevant stakeholders to enforce necessary conditions that should be in place to pave the way for migrant and diaspora investments in Ukraine.
In 2019, IOM Ukraine started implementation of the ‘1+1’ initiative supporting communities prone to economically induced outward migration, migrant workers and their families with co-funding for creation and development of businesses. For each dollar of own funds invested in developing their business in Ukraine, participants receive another dollar as a non-refundable grant for the purchase of equipment. In general, the programme provides equipment worth up to USD 4,000. Same principle is applied to support communities prone to economically induced outward migration, expand economic opportunities, improve social services, and induce jobs creation. IOM is currently co-funding six community development projects with the amount up to 20,000\ on the similar 1+1 principle. Implementation of this pilot initiative in Ukraine is funded by USAID.
In April 2019, when IOM announced a call for ‘1+1’ business support, over 260 migrants applied. Applications came from all the regions of Ukraine and cover a wide variety of spheres: industry, agriculture, construction, services and education. Pre-selected participants received professional consultations for writing a business plan, which they submitted for competition. After successful defense sessions, beneficiaries started receiving the requested equipment.
Participants of 1+1 Initiative share their personal experiences, motivation and plans, inspired support they receive. They are going to work for themselves, on their land, reconnect with their families and friends, create new jobs in their communities. They invest not only money earned abroad, but also international experience. Some of their stories can be found by the links:
Chinese Cabbage. Polish Experience. Ukrainian Business
"Nobody Wants to Go to Work Abroad"
Video: Andrii and His Tractor