Bulgaria Benefits from Emigrants' Remittances More Than from EU Funds

Business | September 21, 2010, Tuesday // 15:06|  views

Economic expert, Georgi Angelov (l), informs Bulgaria ranks second in the EU after Romania by the percentage of the emigrants' remittances in the Gross Domestic Product (GDP). Photo by Sofia Photo Agency.

The economic crisis has not triggered a mass return of Bulgarian emigrants to their homeland, according to a study conducted by the "Open Society" Institute presented Tuesday.

The monetary remittances made by emigrants have not decreased significantly either – in 2009, money transfers from Bulgarians living abroad amounted to EUR 1.2 B with a reduction of 15%, which is much smaller than the decrease in foreign investments.

The conclusions of the study show that in times of crisis and lower investments, the Bulgarian emigrants' money is a significant contribution to the financial stability of the country and to household security.

The "Open Society" Director, Georgi Stoychev, further stated the money sent by the Bulgarian emigrants in times of crisis is more than the absorbed EU funds and is used mainly for food, household bills, and health care.

The remittances of those living abroad permanently keep a stable level of EUR 600 – 700 M a year while temporary workers sent in 2008 EUR 600 M, down to EUR 400 M in 2009, according to Stoychev, who concluded the data means the crisis had affected negatively mainly the latter category.

Border checkpoint polls of Bulgarians entering the country for short stays show that working emigrants are 79% of all emigrants and from them 37% wire money officially, while 15% look for other ways than bank transfers. 48% say they never send money to Bulgaria.

The study also reveals that despite the forecast the crisis will bring many back to Bulgaria most remain abroad with the motive they still have better chances there than in their own country, stating as top reasons the much higher wages and the deplorable state of the public sector in Bulgaria.

Stoychev further pointed out a special government migration policy aiming at bringing back emigrants is futile and a waste of money

Economic expert, Georgi Angelov, who is one of the authors of the study announced Bulgaria ranks second in the EU after Romania by the percentage of the emigrants' remittances in the Gross Domestic Product (GDP).

In 2008, when the crisis began in Bulgaria, 10 000 have left the country, but of them 4 000 have since then returned.

According to official data from Eurostat, the statistical office of the EU, most Bulgarians are in Spain (160 000), Germany (60 000), Italy (40 000), Greece (40 000), the UK (15 000), but Angelov says these numbers are much higher.

Another trend is the constantly increasing number of Bulgarian college students abroad – from 1.9% of the total number of students in 1998 to 8.3% in 2007. Most study in Germany, the US, France, Austria and the UK. Beginning in 2007, the attractiveness of the US colleges began going down and more now prefer those in other EU countries. As an example, Bulgarian students in Germany make anywhere between 4.5% and 6% of all students and Bulgaria sends to Germany more such students than Russia.

According to the "Open Society" experts, if Bulgarian students abroad take a student loan in the respective country, this can influence negatively their desire and decision to return back to Bulgaria after graduation, which will lead to another mass exodus of qualified work force similar to one in the 1990s.

The other noted trend is the diminishing number of people with ethnic Bulgarian background, living abroad, who chose Bulgarian colleges and universities for their studies.

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Tags: Open Society Institute, Georgi Angelov, Georgi Stoychev, remittance, remittances, bulgarian emigrants, EU funds, GDP, eurostat, crisis


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