Transcript Enhancing the Role of Diaspora in Peaceful Development of Armenia

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
Outline

Definitions of basic terms

Stakeholders
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Regional and development contexts of Armenia

The Armenian diaspora
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The Policy Problem

Policy alternatives
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Recommendations: A new role for the diaspora
Definitions

Diaspora – geographic dispersion of a nation, settlement
in different political entities, but members maintain their
national identity, unity and solidarity
Capacity and opportunity
to sustain long-term
development

Sustainable
Development
Maintain Democratic
Stability
Ensure Regional Stability
Major Stakeholders
Home Country
Armenia
Host countries
Neighboring countries
in the region
International Organizations
DIASPORA
Armenia: Regional Context
Russia
ARMENIA
Regional context: high density of conflicts,
unequal access to cost-effective infrastructure
Armenia: Development Context
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
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
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
Graph 1: GDP, employment, real wages % change, 1990=100
120
100
80
60
40
20
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Institutions, practices
GDP 1990=100
Employment 1990=100
Real w ages 1990=100
Diaspora Communities
Darkness of the color represents the
density of Diaspora communities
Diaspora: Major Facts

5-6 mln, hosted by 70 countries
1 bln USD (2006) annual assistance to Armenia
(current transfers, remittances, humanitarian assistance)
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Poverty reduction support and post-conflict
infrastructure rehabilitation

Part of institutional power sharing arrangements in
Armenia (political parties, printed media, etc.)
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Regional Conflict – human, financial, material
resources, advocacy
Channels of Diaspora Assistance
Humanitarian/food
Assistance
Infrastructure Repair
and post-conflict
reconstruction
Sponsoring cultural activities
Diaspora Funding
Supporting education
Institutions
Improving
Healthcare
facilities
National Defense
and security
Dynamics of Diaspora Assistance
Challenges
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Most of the diaspora assistance
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has a philanthropic nature
Dispersed into different projects
Creates sustainability concerns
Armenia

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Lack of a single institution responsible for
diaspora affairs
Capacity gap to guide the diaspora’s efforts
toward achieving its development objectives
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
Primary focus on
philanthropy
Heterogeneity
Institutional rigidity
Different
perception of
national identity
mistrust
Weak guiding
capacities
Transition
challenges
Inadequate institutional
arrangements
Competitive
political
environment
Unwillingness to share the market
Culture of talk
Poor governance and
accountability capacity
What Can be Done?
Policy Alternatives
1. Status Quo – unsustainable
Growth Rate of Real GDP and
Transfers from Abroad (1998=100)
Armenia's Export Pattern and the
Growth in Private Transfers
(1998=100)
800.0%
800.0%
700.0%
700.0%
600.0%
600.0%
500.0%
500.0%
400.0%
400.0%
300.0%
200.0%
300.0%
100.0%
200.0%
100.0%
0.0%
1998
1999
2000
2001
2002
2003
2004
2005
2006
Cummulative Real GDP Growth rate
Growth in Incomes and Transfers from Abroad
0.0%
1998
1999
2000
Cummulative Export Growth rate
2001
2002 2003
2004
2005
2006
Growth in Incomes and Transfers from Abroad
Growth in Incomes and Transfers from Abroad, adjusted for 45% depreciation of the USD in 2004-06
2. Partial revision of diaspora’s role – limited scope
3. Re-vision of diaspora role – better utilization
of the nation’s comparative advantage
New Role for Diaspora to Promote
Armenia’s Sustainable Development
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Create capacities and opportunities to
sustain long-term development path
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Support to achieve democratic stability
Assume the role of a “Third Sider” in
the matters of regional context
Diaspora to promote Armenia’s
Sustainable Development
:
Diaspora to change the nature of its
assistance
Recommendation
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Decrease philanthropy and increase business
partnerships,
Increase responsiveness of diaspora institutions,
Offshore production activities to Armenia,
Job opportunities, business culture, economic diversification
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Assist Armenia’s market access and international
integration, (export expansion)
Mobilize expatriate Armenians
to close the capacity gap
(examples: UNDP TOKTEN system, Korea)
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
Institutional Arrangements
Government of
Armenia
Diaspora
Conference
Diaspora
Assistance,
(Institutions and
Individuals)
Secretariat or Ministry
Ministry of Foreign Affairs
and
All Armenia Fund
Treasury Single
Account,
Central Bank of
Armenia
Treasury
Office 1
Com
munit
y
Treasury
Office 42
Treasury
Office 2
PIU
PIU
Com
munit
y
PIU
Com
munit
y
Expected Benefits
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Armenia’s 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
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
Financial services
Commerce, tourism, etc.
Thank You