In 2022, remittances to developing countries dramatically outpaced foreign direct investment, as the UK grapples with new migration policies that could affect its economic landscape.
In 2022, remittances to developing countries eclipsed foreign direct investment, reaching $831 billion—a 650% increase since 2000 according to the International Organization for Migration (IOM). This surge occurred despite expectations of a decline due to the COVID-19 pandemic. The World Bank underscores the pivotal role of migration in bolstering the economies of low- and middle-income countries. The primary recipients of these remittances were India, China, Mexico, the Philippines, and Egypt, with major contributions coming from the US, UAE, and Saudi Arabia. IOM’s director general, Amy Pope, has advocated for enhanced legal migration channels to curb irregular migration and thwart human smuggling.
Concurrently, the UK is experiencing considerable debate over its migration policies. New visa regulations introduced by the Home Secretary have raised concerns among businesses, especially in London where 50% of employers report difficulties in filling vacancies. These changes include a higher salary threshold for skilled worker visas and modifications to partner and graduate visa programmes, which critics argue may detract from the UK’s appeal to international talent and hinder economic growth.
Amidst these policy adjustments, former UK Immigration Minister Robert Jenrick has recommended a cap on overall migration and additional restrictive measures on student and health care visas. In collaboration with ex-minister Neil O’Brien and the Centre for Policy Studies, Jenrick has proposed the creation of a new Department of Border Security and Immigration Control, aiming for a more restrictive migration system that he believes will alleviate housing crises and reduce strains on public services. These recommendations come as net migration significantly contributes to England’s housing shortage and other infrastructure challenges. Jenrick has pressed current Prime Minister Rishi Sunak to implement these changes ahead of the general election, amidst growing concerns over migration levels and their impact on UK infrastructure and public services.
