Remittances are a Lifeline in Tajikistan

The financial crisis that is affecting the industrialized countries is now beginning to hit the migrant workers, hard. Mr. Dilip Ratha, a senior economist at the World Bank, reports “a serious moderation in the growth of remittances”. The decline will be less severe than for other flows such as foreign investment, but its effects will be amplified in countries like Tajikistan that have become dependent on remittances. Tajikistan will rank first in the world in 2008 for remittances as a portion of it economy - 54 percent - according to an estimate by the International Monetary Fund.

After the Soviet collapse in Tajikistan, more than 80 percent of the population lived under the poverty line of about $2 a day, thus forcing many to look outside their country (mainly Russia) to make a living. Most Tajiks working in Russia - 700,000 to a million people - are in construction, which is one of the sectors worst hit by the credit crunch. Many are losing their jobs, and they are mostly Tajiks and Uzbeks.

Migrant remittances had offered a safety net. In the years of the migrant boom, the portion of the population living in poverty fell by a third, to 50 percent. For example, in Khodja-Durbod, a school was built on migrant money, with each family contributing $100 and 320 bricks.

Despite predictions of further economic downturn well into next year, migrants are not giving up and returning home. Instead, migrant workers said they would dig in further to hold on to any chance for a job.

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