Enhancing the Role of Diaspora in Sustainable Development of Armenia

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Enhancing the Role of Diaspora in Sustainable
Development of Armenia

• by Gohar Gyulumyan,
• Terry Sanford Institute of Public Policy, Duke
  University,
  
• AIPRG Conference
• May , 2008

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Outline

• Definitions of basic terms
• Stakeholders
• Regional and development contexts of Armenia
• The Armenian diaspora
• The Policy Problem
• Policy alternatives
• Recommendations A new role for the diaspora

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Definitions

• Diaspora geographic dispersion of a nation,
  settlement in different political entities, but
  members maintain their national identity, unity
  and solidarity
• Sustainable
• Development

Capacity and opportunity to sustain long-term
development
Maintain Democratic Stability
Ensure Regional Stability
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Major Stakeholders
Host countries
Home Country Armenia
Neighboring countries in the region
International Organizations
D I A S P O R A
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Armenia Regional Context
Russia
ARMENIA
Regional context high density of conflicts,
unequal access to cost-effective
infrastructure
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Armenia Development Context

• GDP per Capita 2600 USD (2007),
• Transfers from diaspora (per capita) 350 USD,
• Poverty 29.8, extreme poverty 4.6 (2005)
• Resource poor, land-locked,
• Transportation corridors blocked
• Economic structure
• construction(22), Industry (20),
• Agriculture (18)
• Foreign trade
• 49 of GDP,
• high export concentration ratio
• Transition Challenges
• Institutions, practices

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Diaspora Communities
Darkness of the color represents the density of
Diaspora communities
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Diaspora Major Facts

• 5-6 mln, hosted by 70 countries
• 1 bln USD (2006) annual assistance to Armenia
• (current transfers, remittances, humanitarian
  assistance)
  
• Poverty reduction support and post-conflict
  infrastructure rehabilitation
  
• Part of institutional power sharing arrangements
  in Armenia (political parties, printed media,
  etc.)
  
• Regional Conflict human, financial, material
  resources, advocacy

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Channels of Diaspora Assistance
Humanitarian/food Assistance
Political Parties
Branches of Church
Infrastructure Repair and post-conflict
reconstruction
Diaspora Funding
Benevolent Org.
Sponsoring cultural activities
Supporting education Institutions
Foundations
Individuals
Improving Healthcare facilities
National Defense and security
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Dynamics of Diaspora Assistance
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Challenges

• Most of the diaspora assistance
• has a philanthropic nature
• Dispersed into different projects
• Creates sustainability concerns
• Armenia
• Lack of a single institution responsible for
  diaspora affairs
  
• Capacity gap to guide the diasporas efforts
  toward achieving its development objectives

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The Problem Tree
C O N S E Q U E N C E S
Sustainability concerns
Persistent Tensions with neighbors in the region
Low level of export diversification,
High transaction costs
Growing regional disparities between Yerevan and
regions
Strategic bargaining in political landscape
Fragile political stability
Low employment response to growth performance
Policy Problem
Inability so far to derive full potential
benefits from diaspora
R O O T C A U S E S
Inadequate institutional arrangements
Primary focus on philanthropy
Institutional rigidity
Weak guiding capacities
Competitive political environment
Culture of talk
mistrust
Different perception of national identity
Transition challenges
Heterogeneity
Poor governance and accountability capacity
Unwillingness to share the market
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What Can be Done? Policy Alternatives

• 1. Status Quo unsustainable

Armenia's Export Pattern and the Growth in
Private Transfers (1998100)
Growth Rate of Real GDP and Transfers from Abroad
(1998100)
2. Partial revision of diasporas role limited
scope 3. Re-vision of diaspora role better util
ization of the nations
comparative advantage
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New Role for Diaspora to Promote Armenias
Sustainable Development

• Create capacities and opportunities to sustain
  long-term development path
  
• Support to achieve democratic stability
• Assume the role of a Third Sider in the matters
  of regional context

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Diaspora to promote Armenias Sustainable
Development

• Recommendation Diaspora to change the nature
  of its assistance
  
• Decrease philanthropy and increase business
  partnerships,
  
• Increase responsiveness of diaspora
  institutions,
  
• Offshore production activities to Armenia,
• Job opportunities, business culture, economic
  diversification
  
• Assist Armenias market access and international
  integration, (export expansion)
  
• Mobilize expatriate Armenians
• to close the capacity gap
• (examples UNDP TOKTEN system, Korea)

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Armenia to Promote its own Sustainable
Development Recommendation Foster reforms,
lead the dialogue

• Government
• Improve domestic competitive environment,
• Create new institution in charge of diaspora
  affairs,
  
• Improve public sector accountability,
• Improve quality of public discourse,
• Create trustworthy and transparent environment
  for partnership
  
• Engage diaspora in policy dialogue
• Private sector
• Create space for business partnership

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Institutional Arrangements
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Expected Benefits

• Armenias sustainable development perspective
• Good governance and openness
• Democratization of the society
• Spillovers and positive externalities for other
  countries in the region
  
• Expansion of regional
• markets
• Financial services
• Commerce, tourism, etc.

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Thank You