Rethinking E.U. Refugee, Asylum, and Digital Nomad Policies

Researching a 2014 debate topic on U.S./Middle East policy, costs for Kurdish refugee camp were reported: “U.S. government funding for refugees has reached $2.4 billion.” Building, operating, supplying, and protecting refugee camps can be expensive. Warfare in Iraq and Syria sent refugees to relative safety in the Kurdish The Domiz Refugee Camp:

Domiz Refugee Camp was established by local authorities back on in April 2012 to host the Syrian Kurds. The camp located 20 kms southeast of Dohuk city, in Iraqi Kurdistan and some 60 km from Syria/Iraq border. The Kurdish authorities are keeping the borders open for Syrians of Kurdish origin. [Source.]

U.S. government funding for refugees has reached $2.4 billion:

As Lebanon places new restrictions on Syrian refugees, Secretary Kerry has announced that the United States will provide another $290 million of humanitarian assistance for those affected by the Syrian conflict, both in Syria and in neighboring countries hosting refugees, including $51 million to support Lebanon as a host community. This brings U.S. humanitarian assistance for refugees of the Syria conflict and their host countries to over $2 billion, and assistance for Lebanon to about $400 million. [Source: human rights first.]

Dozens or perhaps hundreds of nonprofit organizations work to assist refugees in addition to U.N., E.U., U.S., Swedish, and other government programs.

Soon after this 2014 report, the Syrian civil war sent a surge of refugees into the European Union, with 1.3 million applying for asylum in 2015. Refugees and asylum applications have dropped dramatically since.

Still, for the U.S. and E.U., refugees are considered a project requiring “robust international aid” rather than a tragic but valuable opportunity for economic development. Governments are in the business of transfers from taxpayers, but entrepreneurs are in the wealth creation business. Problems are opportunities for business people. It can be enough sometimes to simply reduce restrictions to enterprises and to lower taxes which is being proposed by the Greek government. The War For Digital Nomads Heats Up As Greece Passes New Tax Law (Forbes, December 3, 2020) reports new legislation cutting income taxes in half for visiting workers.

“If you can work from anywhere, why not work from Greece?” asks a promotional document seen by Greece’s parliament this week. Amid dreamy images of whitewashed farmhouses and deep-blue seascapes, it sets out a new law that allows newly settled foreigners to pay half their income tax over the next seven years.

From January 2021, the scheme will be open to both employed and self-employed workers as long as they have not previously been a tax resident of Greece, or replace an existing job in the country.

Greece and Italy, like most E.U. countries, have a depopulation problem. Some 1.6 million departed Greece and Italy after the 2009 financial crisis:

Greece lost 800,000 people to richer nations during the worst years of its debt crises between 2009 and 2015. Now it is hoping to reverse that brain-drain with these and other tax breaks. …Italy’s own brain drain saw 800,000 people leave the country between 2009 and 2019 as its economy struggled to recover from the global financial crises.

So both Greece and Italy have plenty of room or immigrants as well as digital nomads. What they don’t have is a policy to open doors for migrant workers without being on the hook for E.U. and Greek welfare programs. The Greek government also doesn’t want to have visiting workers compete for jobs that Greeks might want to do themselves. Canada has a Start-Up Visa Program where work permits can be processed in two weeks.  More here on Canada’s Startup Visa program- pathway to permanent residence.

Attracting digital nomads with lower taxes is unfair to domestic taxpayers and companies. Still, more people living in Greece means more demand for food, housing, and recreation, which all help create jobs and income for Greeks (as well as taxes for the state). Entrepreneurs often travel with entourages, not only personal assistants but also staff and key employees. Why settle for single digital nomads when entire small enterprises could relocate to Greece? Small and medium size enterprises are key to economic growth, and would create jobs not only for Greeks but also for migrants from poorer countries to provide additional services. Migrants complement domestic workers as well as further boosting demand for local food, housing, and recreation.

Millions of immigrants to America in the 19th and early 20th centuries were refugees from overseas conflicts and famines. However terrible the conditions were in the lands they left, their arrival in the United States, Canada, Argentina, and Australia, stimulated economic demand for new housing, infrastructure, food, clothing, new jobs and new businesses. Immigrants launched many of the dynamic enterprises creating hundreds then thousands of new jobs for Americans and new immigrants. Most worked their way out of poverty in the following years.

So in a world today with some 42 million refugees, how best can governments actually help? Remove barriers to work. Economic opportunity is still the best response.

The Women’s Refugee Commission explains home-based enterprises for refugees here:

The basement was cold and dank. The Iraqi refugee women huddled around the single kerosene heater – gloves on, scarves wrapped tightly around their necks. They began to speak. “We can do anything. We have to.” “Our husbands sit at home depressed and do nothing,” they said. Fierce. Tough. Reticent. We were in the grim, industrial city of Zarqa, some 30 miles north of Amman. It is a place where many Iraqi refugees relocate when they start to deplete their savings: the rents are cheaper than Amman; the city, shrouded in smog, is less desirable.

 I was here on behalf of the Near East Foundation (NEF), a partner organization, to assess home-based enterprises: Are they viable? If so, which sectors provide the most realistic and lucrative opportunities?

Iraqi refugees do not have the right to work in Jordan, but they can engage in “under-the-radar” income generation activities. This informal work, much of it undertaken in refugees’ homes, is a source of much-needed money to provide for their families. In addition, prevailing socio-cultural norms often impede women’s mobility in the public sphere and hamper their access to markets and other economic opportunities. As such, home-based enterprises are the only feasible option for most Iraqis and even for many Jordanian women.

But wait, how can refugees “not have the right” to work in Jordan? Refugee have rights even when not recognized by host governments. Regulations preventing formal employment drive work underground into lower pay and more dangerous informal jobs. And international and E.U. refugee policies that provide aid yes prevent work can lead to more refugees to eventually become lifetime welfare recipients.

This 2011 New York Times article, “Beyond Refugee Camps, a Better Way,” looks at the injustice and economic waste of current refugee policy:

Camps condemn refugees to years, maybe decades, of dependency.  There are people in Dadaab who have not stepped outside the camp since it opened in 1991. …

In 1951, an international convention set forth the rights of refugees: these include the right to move freely and to work.   Camps, however, hold refugees against their will and do not allow them to work in the local economy.  Camps are not only routinely violating refugees’ rights, the whole camp system is based on their violation. …

Study after study has shown that immigrants actually contribute far more money and jobs to their new country than they take — even illegal immigrants.  The sudden absorption of tens of thousands of people, however, especially when those people have little education or usable skills, is bound to be a burden.  But even they can be productive.  S.O. from Chicago (8) wrote that from his experience as a refugee resettlement worker, poor Somalis often do better than Iraqis in America — they take the first job they can, work hard and form tight communities.  Some middle-class Iraqis, he wrote, turn down jobs, handicapped by expectations that are too high.  “Just imagine how much talent is lost languishing in today’s large camps,” writes Lynn from New York (7).

Previous posts have argued that economic freedom, or the lack of it, is at the root of poverty and conflict across Middle Eastern countries. See Reduce Refugees by Boosting Freedom (August 2020), for example. Countries where formal private enterprise is tightly regulated also restrict the economic freedom of refugees: “Iraqi refugees do not have the right to work in Jordan, but they can engage in “under-the-radar” income generation activities.  “Under-the-radar” unfortunately translates as informal or illegal, and that means police or politicians have to be paid off not to notice.

E.U. and U.S. refugee policies could encourage governments receiving E.U. and U.S. aid to allow refugees access to productive work. In the status quo, government aid flows to host governments, and NGOs are free to bring their checkbooks and food aid. But bringing tools and technology to invest in productive enterprises is a horse of a different color. Suddenly there are fears that refugees and their children might be “exploited,” or might not receive “living wages,” or that someone might profit from refugee labor (the horror!). Locals might complain that they should benefit from job opportunities or that refugees are putting them out of work. And local elites wouldn’t miss the chance to grab aid and investment dollars flowing by.

Reinventing refugee camps as free-trade zones or economic freedom zones would allow international investors, NGOS, and relatives overseas, to bring capital equipment for home and local enterprises where refugees from conflicts in Syria and Iraq could support themselves as they learn skills each day.

Details of a new refugee camp in Jordan are discussed in this May 30, 2014 New York Times article:

During three years of conflict, more than 2.8 million Syrians have fled their country, with nearly 600,000 of them heading to Jordan, mostly women and children. Those numbers include only people who have requested United Nations assistance; aid workers believe that the total is significantly higher.

Refugees don’t have to be a long-term burden for societies or for international aid agencies.  Consider the example of over 700,000 refugees “flooding” into a Middle Eastern country in the 1990s, as discussed by Phillipe Legrain:

This flow of people to Israel was, in Mr. Legrain’s words, “one of the most dramatic experiments in the history of immigration.” (p. 133)  Mr. Legrain notes that between 1990 and 1997 over seven hundred thousand immigrants from the former Soviet Union arrived in Israel, a country with a population of about 4.6 million in 1989, and almost half of the immigrants entered in a two year period. (p. 134)  Mr. Legrain puts these numbers in perspective for America:  “Imagine, then, what would happen if over 15 million foreigners were suddenly to arrive in the U.S. over the next two years, rising to 29 million over eight years.  Twenty-nine million people who don’t speak English, don’t have jobs to go to and don’t even have any experience of working in a capitalist economy… Mass unemployment?  Riots in the streets?  Perhaps even the collapse of society?” (p.134) [Source.]

[Update: this July 4 NYT story of rethinking refugee camps:

These vast forced migrations have accelerated discussions about the need to treat camps as more than transitional population centers, more than human holding pens with tents for transients. A number of forward-thinking aid workers and others are looking at refugee camps as potential urban incubators, places that can grow and develop and even benefit the host countries — places devised from the get-go to address those countries’ long-term needs — rather than become drags on those nations.