The meritsof remittance to one’s home country for that nation are evident: bolstering theincome of individuals, freedom from reliance on governmental subsidies andgreater prosperity due to high exchange rates of Canadian currency to MENAcurrencies.
Likewise, there are merits to the Canadian government’s involvementin Arab Canadians’ remittances to the MENA. To begin, high rates of remittancefrom individuals assuage the burden of foreign aid from the government itself.Additionally, the opportunity to invest in foreign markets is facilitated by suchmigrant networks, which may actually “… provide business opportunities bydecreasing asymmetries of information by reducing transaction costs throughformal (e.g.
, business) or informal (e.g., familial) contacts in their homecountry.” (Leblang, p 587)1 Canada may capitalize bydeveloping such a relationship with the expatriates of foreign nations whom arealso living in Canada: expatriates are “… more likely to invest in theirhomeland … because language and cultural knowledge more than compensate forwhat may be marginally lower returns,” (p 587)2 opening the door tobilateral cooperation and growth facilitated by the Arab diaspora.
The reasonfor a higher likelihood of investment in home country may be explained by thehome country bias and the familiarity effect, when in the face of statisticalfact, investors and senders of money choose to send their money to places otherthan those which would be most economically efficient due to personal affinitiesthat bind them to their country of origin. These transfers are not significantwhen compared to investments such as FDI or Portfolio investments, but they arelarge enough to not be negligible. The cultural affinity Arabs in Canada have to theirhome countries, as well as to the broader MENA, is demonstrated by thesustained financial relationship between the migrant and the home country, andlack of a full assimilation of conscience to their host country, which in thiscase is Canada. In fact, of the top ten migration corridors from theMiddle-East are to other countries in the MENA (48)3.From the occupation of Palestine and the displacement of its people beginning in 1948, to the Canalde Suez crisis of the 50s, to the Gulf War of the 90s, to the War on Terrorismwaged on the Iraqi people in the 2000s, to the present day of devastationtaking place across Yemen, Syria, and Libya, among others, following the ArabSpring in 2011, Arabs are chronically, forcibly displaced by violence,injustice and the corruption which authorizes the two. From within the MENA,Arabs move to other MENA countries, most often situated in the Middle Easternregion. As such, some of the highest corridors of remittances between countriesare between MENA countries, such as (place examples of heavily financedcorridors, such as Oman to Yemen and Saudi Arabia to Yemen and UAE to Yemen).
Forthese reasons, Arabs have become highly adaptable to new countries ofimmigration, as well as developing a diaspora culture of remittance, return andrebuilding. Human capital cultivated in Canada, among other countries, of Arabdiasporas, often returns to the home country in order to work for Arabcountries and help rebuild private, public and non-for-profit sectors. MENAgovernments are aware of this fact – many countries have recently begun toexplicitly welcome and embrace the contributions of their expatriates, “… anexplicit acknowledgement that expatriates are a resource to be leveraged fornational economic betterment (80).4 1 David Leblang, Familiaritybreeds investment: Diaspora networks and international investment, (American Political Science Review, 2010), 587. 2 Ibid.
, 587. 3 Dilip Ratha,Christian Eigen-Zucchi, and Sonia Plaza, Migration andremittances Factbook 2016, (World Bank Publications, 2016), 48. 4 DavidLeblang, Harnessing the diaspora: Dual citizenship, migrant return remittances,(Comparative Political Studies 2017), 80.