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Economic Transnational Activities

Remittances are the form of transnationalism that is perhaps best monitored by supranational institutions as well as by sending and receiving countries. The World Bank estimates that global remittance flows, including those to high-income countries, reached US $542 billion in 2013. That number is expected to have increased to $581 billion in 2014, of which $436 billion flowed to developing countries. Europe's top five remittance-sending countries are Switzerland ($19.6 billion), Germany ($15.9 billion), Italy ($13 billion), Spain ($12.6 billion), and Luxembourg ($10.6 billion). In view of the large amounts involved, sending states have shown great interest in trying to regulate remittances through formal channels. Classic labour-exporting countries, such as Turkey, have long been keen to manage these flows (Mügge 2013a). But “newer” sending countries too, such as Romania, have attempted to exercise significant state control over the money, people, and goods that cross its borders. In Romania this control diminished with the weakened macroeconomic situation in the 1990s, opening more opportunities for private and informal actors (Ban 2012). This is not a standalone pattern. Levitt and De la Dehesa (2003) found that Brazil and Mexico extend more state services to emigrants than Haiti and the Dominican Republic, in part due to the greater capacity of the former. Although countries like Haiti are heavily reliant on remittances, policy efforts to regulate these flows have been hindered by financial limitations and political instability. Portes, Escobar, and Radford (2007) present a similar conclusion for Colombia and the Dominican Republic.

Governmental regulation of remittances requires a well-functioning bureaucratic apparatus. Remittances from Europe to weak states are therefore largely informal. For instance, an estimated half of the population of Surinam receives material remittances, sent by 63.9% of the Surinamese residing in the Netherlands (Unger and Siegel 2006, 120). Unregistered remittances might equal the amount of remittances officially registered (ibid., 118). These inflows are one of the most stable sources of income for poverty relief at the household level in Surinam (Kruijt and Maks 2003). Informal remittance transfer channels are used by illegal migrants who may feel uncomfortable with established money transfer services or not know how to use them (Ban 2012, 137). Remittances may also be reverse. A study of Romanian immigrants in Italy found that migrants who were unemployed or had medical or legal problems received financial aid from their families back home (ibid.).

How do economic transnational activities relate to economic integration? Several European studies argue that there is a positive relation between upward social mobility in the country of destination and transnational commitments (e.g., Snel et al. 2006) or at least that these are not mutually exclusive (Mazzucato 2008). Drawing on findings from a comparative case study of remittance practices among two North African groups in France and one North Indian group in the UK, Lacroix (2013, 1023) argues that economic transnational activities hinge on (i) material and social resources resulting from social integration and (ii) patterns of identity formation. According to Lacroix (ibid.), Punjabis in the UK, benefitting from their relatively good economic integration, have been able to build public infrastructure such as hospitals and schools in their region of origin in India. Though the economic integration of Moroccan Berbers has been less favourable, these immigrants' integration into French civil society enabled them to link informal collectives of hometown citizens with external funding bodies (ibid., 1033). Kabyles have been incapable of establishing similar connections, due to a fragmented civil society resulting from the civil war in Algeria (ibid.). Carling and Hoelscher (2013) argue that migrants need both the capacity and the desire to send remittances. Capacity emerges from economic integration (e.g., secure employment and sound household finances), while desire may be fostered by identify formation. A quantitative survey of more than 3,000 immigrants in Norway (ibid.) and an ethnographic study of Somalis in the UK (Hammond 2013) both confirm that economic integration is decisive for remittance sending.

 
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