Effect of Arab Revolt on OFW Remittances

What will be the effect of the Arab Revolt on the remittances of OFWs? Well, in short – VERY LITTLE. And here are a number of reasons why:

Small OF Populations. The revolts have so far been in countries with relatively small OF populations. Tunisia, Libya, Egypt, Yemen and now Syria have few OFs. There were more OFs in Bahrain and Oman, but in Oman’s case the problem seems to have been short-lived. The Bahrain problems have not caused an exodus of OFs. If big protests take place in Saudi Arabia (which has at least 800,000 OFs) it will be only then when we should worry about OF remittances.

OFs Don’t Flee. OFs don’t immediately flee when there is conflict. No Filipinos have left Yemen since their troubles started. In Libya, the majority seem to have decided to stay on, despite the civil war. And when they do flee, they try to get another job in the region. I remember when Kuwait was invaded (in 1990); many of the Pinay domestics there evacuated with their employers to Europe, and they found other jobs there.  OFs don’t want their deployment fees to go to waste; and many also don’t want to abandon their jobs, since this may result in their being blacklisted (or so they fear).

War Premium. OFs who stay on in the middle of conflict may even earn more because of war premiums. During the Iran-Iraq war of (1980-88) many Filipino seamen collected 4 times their regular pay when their ships entered the war zone. Of course, many also died during this war, because many ships were torpedoed, but that’s something else. It seems that nurses in Libya are now earning 3 times their normal pay because of the war.

Post-revolution Boom. After the revolution – whether or not the revolution wins – economic development seems to favor the hiring of more OFs. If the tourism industry is stimulated, this would mean more Hotel/Restaurant workers would be needed – and this almost certainly would include Filipinos. If health care services would be expanded, this would mean employment for Filipino nurses. If a construction boom ensues, they would need Filipino construction workers.

Locals Work for Government. In the Gulf, local workers aspire to work for the government; leaving the bulk of private sector jobs to migrants of all kinds. A lot of these migrants come from non-Gulf countries like Egypt, Jordan or Lebanon; but they also include workers from places like the Philippines. Filipinos will always find work in the private sector there, since we are known to be good workers. Some companies even advertise the fact that they have Filipino workers – putting up signs saying that “We have Filipino workers”. Filipinos are the last to be laid off, and the first to get hired. Our place is assured.

Implications of Mideast Unrest for the Philippines

The crisis in the Middle East seems to have gained momentum. It has so far resulted in the overthrowing of the dictatorships in Tunisia and Egypt. Now, it is spilling over to other countries: Iran, Bahrein, Yemen, Libya and Algeria.  This seems to be a new trend in the Middle East – young people willing to risk their lives in the struggle for democracy, and succeeding beyond what people could imagine even a couple of months ago. I think this trend will continue for some time. In fact, I think this is THE new trend in the Middle East – to replace that “old” trend of Islamic Fundamentalism.

What does this all mean for the Philippines?

Overseas Filipinos. The unrest in Egypt has meant that some scores of Filipinos working there have had to go home. Some Filipinos in Bahrain and some other countries may also be forced to do so in the coming days or weeks. But the impact of the unrest will be bigger than that, especially if the young people are victorious in their struggle. Because one of the main issues behind the struggles is that people want more jobs created.  And this means that governments, even those who manage to survive the protests, will have to pursue programs to employ more locals.

A local-hire policy for Egypt will probably not displace Overseas Filipinos (OFs) there, but it may in countries which have a bigger migrant work force. The Gulf states e.g. Bahrain, have a lot of OFs.  If the governments in the Gulf countries institute local-hire policies, intensify the job-trainings for locals, etc., this could mean that less migrant workers would be hired. And that will include Filipinos.

There is, however, a “but” to all this. If the governments of countries like Egypt, Lebanon and Jordan manage to stimulate the economy and increase employment opportunities, their people will not have to go to the Gulf countries as migrant workers.  Jobs would then be available to others, including Filipinos.

So, it all depends…

Higher Wheat Prices. Another issue that governments in the region are sure to address is that of wheat prices. Wheat is very important for people there, and they have seen a very significant rise in prices recently. What many governments are already doing (even those without significant protests) is to increase wheat price subsidies.  They don’t want to be overthrown, so a “little bit” of subsidy for wheat imports is a small price to pay for stability.  Or, for countries with successful revolutions, this is one of the things that the people will demand, and get.

If countries in the Middle East would all increase their subsidies on wheat, the result will be an increased overall demand for wheat, which can only mean that the world price for wheat would go even higher. And this will be felt in the Philippines. Already, the Philippine government has turned back tax increases on wheat imports. But the price will continue going higher for some time to come – and may remain at that high level.

Thus, expect even more increases in the price of pan de sal ,Tasty and other wheat products…

Muslims in the Philippines. I believe that another result of the unrest in the Middle East will be the decline of Islamic Fundamentalism. The Egyptian revolution is a turning point, a trend break, in the Arab world.  Egypt has always played a leading role in such trends. Arab nationalism started with Egypt’s Nasser; Islamic fundamentalism also started in Egypt. Thus, I believe the new “facebook” inspired revolution is another Egyptian trend that will be adopted by the Arab world.

Islamic Fundamentalism is the ideology that has been attracting the youth of these countries. Now, the youth have a new call – one of democracy and progress –  which they can aspire for. If Egypt becomes economically successful as a result of their revolution, I think that Islamic Fundamentalism will indeed become a thing of the past, in a few years.

The strength of Islamic Fundamentalism comes from its appeal to the youth, and in the funds that it is able to raise. If the youth are attracted to something else, there would be less recruits to Al Qaida and other Islamist movements. If people have something else to donate to (i.e. the pro-democracy movements), they will not give as much money to Al Qaida. This is why I think that Al Qaida will soon be a thing of the past – if it is starved of youth recruits and money, it won’t last long.

What about Abu Sayyaf?  Abu Sayyaf these days gets money from Al Qaida and other such Islamist organizations. And they do this by staging terrorist attacks etc, making videos of them, and sending these to Al Qaida et al. They get paid by Al Qaida, in effect, for undertaking terrorist attacks. If Al Qaida runs short of funds, this will also mean decreased Abu Sayyaf activity.

It may also be that Filipino Muslims would have their own “facebook” revolt against their trapos. Political dynasties such as the Ampatuans etc rule their areas as if they were absolute rulers. If the Muslim youth get inspired by Egypt, it may mean the beginning of the end for these mini-dictators who have been exploiting them for so long.

Who knows, maybe the Egyptian revolution will inspire the full blooming of democracy and the economy of our Muslim areas.