Emigrant money exceeds foreign investments

published on 1/26/12 1:12 PM

Photo: archive

The Bulgarian emigrants have emerged as the biggest investors in the economy of the country. In figures released by the Bulgarian National Bank, by end-October EUR 680 M has arrived locally and the total amount of emigrant cash for 2011 is expected to go beyond EUR 760 M. In this way transfers made by emigrants surpass the size of foreign direct investments in Bulgaria last year that came to EUR 740 M. The estimates do not exhaust all the money that emigrants transfer back home because statistics fail to report on some of the most popular channels of transfer among them – the unofficial ones. These include cashed sent through friends, relatives and on the international bus lines and flights. BNB figures suggest that money cashed in by Bulgarians employed abroad grows by 8.4 percent per annum. In official estimates more than 1.2 M Bulgarians live and work across the world.

European statistics too, make clear the ever stronger role of emigrant money. In 2010 Bulgarians working abroad officially injected EUR 760 M into the country. This places Bulgaria at No. 4 in EU. According to Eurostat, if deprived of this serious financial input, the deficit of the current account would have jumped by 160 percent. On the other hand however, Bulgaria has lost 5.4 percent of its GDP through Bulgarians abroad working for the local economies. To put it in another way, economic emigration costs Bulgaria close to EUR 1 B annually. This is made clear in the annual report of the European Commission on employment in EU. European statistics provide other data related to Bulgaria. It turns out that 7 percent of the able-bodied Bulgarian population is employed abroad. The good news is that the inflow of emigrants into West European countries has slowed down as recession has contracted the labor market and hence, job opportunities. In this way the Bulgarian labor migration has shrunk by 18 percent.

Data released by the European Statistical Office coincide with information from the National Statistic Institute. Bulgarian statistics report on the comeback of many emigrants who used to work in EU countries. The cause behind this process is the same: the contraction of the market has made many Bulgarians who have previously worked in other countries, come back home and look for jobs locally. The crisis however has struck a few major sectors of the local economy, so good jobs are not very common. Besides wages are much lower than the EU average. So, many of the “prodigal” sons and daughters spend the winter in Bulgaria and as the spring blossoms, hit the road for jobs somewhere else across the wide world.

Despite hardships in a foreign country, the Bulgarian economic emigrants are reluctant to stay here for long. This is due to disenchanting low wages, life and work conditions, especially in Bulgaria’s small towns and villages. The biggest Bulgarian emigrant communities are found in Spain, Germany, Italy, Greece and UK. Bulgarians there work predominantly in the sector of services, hotel management, construction, trade and agriculture. The Institute for Economic Studies points to the Bulgarian emigrants in Spain who spend most of their earnings in the Spanish economy, not in the Bulgarian one. As much as 60 percent of those employed there have their own home and close to three-quarters do not wish to come back to Bulgaria. The same attitudes are valid for Italy where one of the largest Bulgarian communities is found. Fifty percent of the Bulgarians there have no intention of returning home. In the context of emigrant money transferred to Bulgaria, the largest amounts are sent to families and relatives by Bulgarians employed in Italy. They send an average of EUR 190 to their families in Bulgaria. Emigrant cash flow from USA and Canada however has contracted, experts report, because the cost of living in those countries is high and little cash remains for relatives in the home country.

Like other generations before them, young and educated Bulgarians see the West as the place where they can enjoy successful careers. The brain drain is the most painful problem of the Bulgarian economy. Bulgaria continues to act as a donor of highly qualified hands to West European countries. This is seen in Eurostat figures too. In European statistics 70 percent of young people in Bulgaria are determined to emigrate and pursue careers and high incomes abroad.

Translated by Daniela Konstantinova

По публикацията работи: Tania Harizanova

Последвайте ни и в Google News Showcase, за да научите най-важното от деня!

Share

Emigrant money exceeds foreign investments

More from category

Germany remains Bulgaria's largest foreign trade partner

Bulgarian National Bank expects Bulgaria to meet price stability requirement for entering the Eurozone

Two opposition parties call on the state to acquire Lukoil

Germany remains Bulgaria's largest foreign trade partner