Empowering Migrants and Harnessing Remittances for Development

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Empowering Migrants and Harnessing Remittances for Development

Philippines
Project Summary
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Our strategy is to empower local communities in the Philippines to build strong and sustainable communities through microenterprise development. We are different in that we work with previously untapped sources of entrepreneurism and financing: migrants and remittances. 7,582,502 Filipinos reside and work overseas, earning and sending money to their families for primary needs and personal consumption. These monies are called ?remittances,? which in 2003 totaled $7.9 billion. If mobilized, remittances can jumpstart local enterprises, creating jobs and income for local people. Unlad works with migrants to curtail extraneous spending and to save and invest in projects that will raise the socio-economic well being of local communities.

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Strategy Summary:

Our strategy is to empower local communities in the Philippines to build strong and sustainable communities through microenterprise development. We are different in that we work with previously untapped sources of entrepreneurism and financing: migrants and remittances. 7,582,502 Filipinos reside and work overseas, earning and sending money to their families for primary needs and personal consumption. These monies are called ?remittances,? which in 2003 totaled $7.9 billion. If mobilized, remittances can jumpstart local enterprises, creating jobs and income for local people. Unlad works with migrants to curtail extraneous spending and to save and invest in projects that will raise the socio-economic well being of local communities.

How the Strategy Works:

The strategy is based upon a replicable model called MSAI-for-CDR (Migrant Savings and Alternative Investment for Community Development and Reintegration). The premise is that migrants must plan for the future because labor contracts are temporary and unsustainable. This model empowers migrant communities to create microenterprises for sustainable, long-term benefit. Step 1 ? Organize the migrant community: The first step is to organize the migrant community. While migrants understand the temporary nature migration, the prospects of saving and investing in microenterprises can be initially daunting. Not everyone is born an entrepreneur, and Unlad goes to great lengths to reach out and educate migrants about the risks and rewards of investing. For those who chose to participate, training in savings strategies, business management, and investing is provided. Unlad has garnered widespread support from migrant communities all over the world, like seamen in the Netherlands and domestic workers in Hong Kong. Step 2 ? Identify prospective microenterprise projects: Migrant communities invest only in viable microenterprise projects. Unlad conducts thorough feasibility studies, due diligence with management teams, and assessments of future profitability. Unlad works with community members to identify prospective projects, and migrants can also propose projects from local industries in their hometowns. Only a small percentage or reviewed projects are considered for investment. Examples include raising livestock, diversified farms, merchant businesses, small- and medium-scale manufacturing, and others. Step 3 - Forge community partnerships: Support from community partners is critical, and MSAI-for-CDR effectively mobilizes strategic partners. Government agencies, local government, community-based organizations, universities, and the private sector provide capital investment, in-kind contributions, technical and research support, and social services. For example, Unlad partners with Hong Kong-based Asian Migrant Centre to provide training for the Forum of Filipino Reintegration and Savings Groups to invest in projects. Unlad has also facilitated public-private partnerships with the Bank of the Philippine Islands to establish financial education curricula for migrants. Step 4 ? Execute the project: Once the previous steps have been accomplished, the microenterprise projects can be launched and executed. There are a number of arrangements that can be established, such as working with outside project management teams or electing managers from their own ranks. These managers are responsible for the execution of the project and apprising the savings group of progress. For example, migrant groups in Hong Kong elected a capable migrant returnee to operate the FAMDEV diversified farm in Malaybay, Bukidnon. The farm spans 5.5 hectares and includes free-range chicken raising, cut flowers, and other agriculture. The management team has worked through typical management challenges and produces between 600-800 heads of chicken per 15-day cycle. Step 5 ? Measure performance and improve operations: Measurement is critical for assessing performance and understanding the overall impact of MSAI-for-CDR. It identifies efficiencies and deficiencies, such as production capacity problems for coconut husks in San Isidro. Management is currently looking for investments to purchase machinery to expand production capacity. Measurement also assesses the broader socio-economic impact. For example, in Bukidnon, the FAMDEV farms benefited the community by creating jobs for 4 permanent workers and 60 seasonal workers. Step 6 ? Reintegration: When migrants return to the Philippines, Unlad helps them to make the necessary transitions to adjust to life at home. Continuing education and management training provides them with skills to assist in managing existing microenterprise projects or to seek out new opportunities. Unlad and its partners also provide vital social services to migrants who have experienced social and psychological complications associated with migration and abuse abroad. What makes it possible to replicate this strategy: MSAI-for-CDR can be replicated wherever migrants work and live. Migration is a modern day phenomenon that has reached unprecedented levels around the world, sending an estimated 175 million people outside of their home countries like India, Mexico, Egypt, Pakistan, Nigeria, and others. Specifically, MSAI-for-CDR provides a structured framework that allows organizations to replicate the aforementioned steps in any migrant community. Furthermore, the model fosters sustainability by building consensus around a common vision and binding migrants and partners to achieving the vision. And while the model is structured, it remains flexible to account for cultural differences, i.e. India versus Mexico. Unlad has already consulted in countries like Tajikistan and Indonesia to explore replication.

Key Strategy Elements:

<ul><li class="entry-label">Mobilizing Citizen Support: <span class="entry-text">Citizen mobilization is critical to MSAI-for-CDR. As an empowerment strategy, migrant communities play the central role as the investor and, in some cases, the manager of the microenterprise projects. For this reason, Unlad focuses on mobilizing migrant communities and engages in extensive outreach and advocacy efforts to connect with migrant communities. In general, migrants are attracted to Unlad because of its respected reputation and track record of aiding migrant communities since the mid-1990s. Furthermore, migrant communities support Unlad and MSAI-for-CDR because they recognize the temporary nature of foreign labor contracts and see the value of planning for their futures.</span></li><li class="entry-label">Generating Financial and Nonfinancial Resources: <span class="entry-text">MSAI-for-CDR generates a new source of development financing. It taps into a significant capital source in the form of migrant remittances. The development community has identified this potential, but has struggled to define an effective approach. MSAI-for-CDR has proven to be a viable strategy that not only mobilizes remittances for development, but also harnesses the entrepreneurial potential of migrants to act as savers and investors. MSAI-for-CDR also generates additional sources of financial and non-financial aid through its strategic partners. Local governments, NGOs, and private businesses have offered financial support in terms of matching funds, as well as non-financial aid such as donations of buildings, offices, and land.</span></li><li class="entry-label">Establishing Relationships with Strategic Partnerships: <span class="entry-text">Unlad has established strong relationships with key partners. Locally, these include the national government (through the Overseas Workers Welfare Association), local government (Jagna), NGOs (Asian Migrant Centre and Atikha), civil society (Mother Ignacia National Social Apostolate Center), universities (Leyte State University) and the private sector (Bank of Philippines Islands). Together, these partners support migrant communities and their efforts. Internationally, Unlad built awareness and support abroad through work with multilateral institutions like the International Labour Organization. Mayan Villalba, the director, also reaches out to leading US non-profits like the Global Fund for Women, where she serves on the board.</span></li><li class="entry-label">Developing Information and Spreading the Message: <span class="entry-text">Unlad reaches out to migrants through traditional marketing efforts like print / collateral materials and community outreach like training seminars, workshops, and through active participation as an activist organization for migrant rights. Unlad also promotes its efforts more broadly through research and advocacy, publishing papers and participating in conferences. It helped coordinate the ?International Conference on OFW Savings, Remittance and Economic Potential? in Bohol, Philippines. It was attended by over 150 participants from leading migrant groups, local government, national government agencies, the media, and NGOs from all over Asia, Europe, and the United States.</span></li></ul>

Impact
Increasing Self-sufficiency and Social Impact:

Unlad's approach and the MSAI-for-CDR model diversifies the development financing sources, and weans the organization off of traditional forms of development aid like foundation grants and private investment. As a result, Unlad is able to continue to pursue its mission of helping migrant communities build towards brighter futures. Furthermore, as demonstrated in parts (4) and (5) of this application, MSAI-for-CDR significantly raises Unlad's social impact by empowering migrants to act as entrepreneurs within their own communities to establish microenterprises that create jobs and income that benefit not only themselves, but also their family and neighbors.

Organization Mission and Vision:

Mission - To build sustainable and socially desirable enterprises that accelerate poverty alleviation and promote economic development through mobilization of migrant savings and investments (MSAI-for-CDR). Unlad Vision - A society that cares to painstakingly build viable livelihoods for its people

Looking Forward to the Next Three Years:

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