Catalog

Conclusions

Over the past two or three decades, demographic, economic, and policy changes have conspired to produce burgeoning migration flows in Asia. These trends are likely to be further amplified in the future, leading to an even larger number of Asian workers on the move.

The mounting pressures for greater international labor migration present opportunities for significant economic gains, but will also lead to policy challenges. More Asian countries are likely to take a strategic approach to managing migration and will shift their focus from policies that focus on temporary migration flows to more formal, long-term policy frameworks that recognize the deeply embedded structural factors that are driving migration. These frameworks can be expected to attempt to maximize national interest while minimizing the social friction that is sometimes associated with large-scale migration. But there is also a need for greater cooperation.

Existing frameworks are inadequate and the construction of yet more barriers to the migration of unskilled workers is at odds with underlying realities and economic opportunities. The persistently large presence of undocumented migrant workers not only demonstrates the institutional weakness of existing arrangements but also that there are all-round economic gains to be made from more liberal regimes.

Effective management of cross-border labor migration is highly dependent on effective international cooperation. Asia is well positioned to pursue greater regional liberalization of labor mobility to address the growing imbalances in its labor markets. The quantitative scenarios presented earlier illustrate the potential gains and suggest that labor mobility issues warrant closer attention. Existing bilateral agreements are certainly more useful instruments than ad hoc or unilateral approaches to the management of migrant flows. But they can be distortionary (in the same way that bilateral trade agreements are) and are often linked to the closeness of sociopolitical ties rather than the potential for economic gains. Moreover, bilateral accords make it hard to get countries together to agree on common standards on issues related to workers' rights or other regulations.

Asia has seen some tentative movements toward greater regional cooperation in managing and facilitating labor migration flows. The Asia- Pacific Economic Cooperation grouping has identified measures to facilitate the mobility of business people within that region. In May 2003, the Senior Labor Officials' Meeting of ASEAN nations agreed to begin liberalizing their labor markets by opening up certain sectors to workers from other ASEAN countries. There has also been a significant increase in policy dialogue and cooperation among labor-sending economies and among labor-receiving economies, and between the two sets. These efforts are still very much at early stages. Regional governments need to cooperate more to further open up their labor markets, promote orderly and managed labor flows, and minimize the transaction costs of migrant workers.

As Asian countries are gearing up efforts to intensify regional economic integration, the experience of Europe may be relevant. The free movement of labor between EU member states is a principle underlying its Single Market Programme. Following decades of progress in trade and financial integration, the EU has also steadily moved toward greater intracommunity mobility of workers. The increased labor mobility helps member countries dampen the effects of country-specific shocks and alleviate the structural pressures from long-term demographic changes. Though Asian countries have made substantial progress in integrating their goods markets and are now beginning to make some headway on capital markets (see Part 1), a vision of an "integrated Asian labor market" is yet to emerge. Still, efforts to promote regional cooperation and liberalization in labor migration, to complement deepening integration in goods and capital markets, hold great promise for the future.

References