Could Peru become a net migrant destination?

“A good rule of thumb to ask of a country: are people trying to get into it or out of it?” – Tony Blair

Last week statistical agency INEI released its report on migratory movements in and out of Peru. The media seized on the 12.1% increase in foreigner work visas in May 2015 compared with the same month last year.

But that was just a small part of the big picture. I went straight for the number of people who came in vs. how many left.

In 2014, just over 89,000 more people left Peru than entered. But given there were over 13.5 million total movements in and out of the country, a negative balance of 89,000 is only -0.7% of the total. Through May, Peru’s net migration balance in 2015 was -110,700, or -1.8%.

Digging into the monthly data reveals the exits are front-loaded. Entrances into Peru come toward the end of the year, with October and December seeing significant positive balances. The net migrant balance through May 2014 was -2%, indicating a continuing positive trend toward a net migration balance of 0%.

When net migration equals zero, the same number enter the country as leave, which would be quite an achievement at this point in Peruvian history.

Peru was a net migration destination for over a century. Vast natural resources as well as commodity booms such as guano and rubber attracted laborers and merchants from Spain, China, Italy, Japan and other countries.

However the balance shifted negative in the early 1960s and Peru became a net migrant sender. It was not until the late 1970s, however, that Peru began to send waves of human capital abroad. Peruvians leaving the country over the next 30 years would outnumber all the combined immigrants who came to Peru in the previous 150 years.

There are benefits to troubled countries sending its citizens abroad, the most important being remittance payments. Immigrants send over $500 billion to family in their home countries every year, and the number is growing. That money is important for struggling countries.

The other benefit to sender countries is the education, training and experience that migrant citizens bring back when they return to their home countries. However this depends on the migrants returning home, which many do not.

When that benefit does not materialize, we see the greatest disadvantage to being a sender country: brain drain. How much value was lost in Peru because capable people left?

On the other side of the coin, brain drain is a benefit for destination countries. I am from the United States, the biggest migrant destination in history. American achievements linked to brains acquired through immigration include no less than the atomic bomb and Google.

Peru is uniquely positioned to acquire elite brains through immigration. While the vast majority of immigration to destination countries such as the United States, the United Kingdom and Germany comes from low-skilled workers looking for a better life, the immigrants to a country like Peru are more likely to be educated. They are more likely to come with capital to invest.

I have not seen the data on this, but it is safe to assume Peru’s net migrant balance is not closing due to an influx of desperate laborers looking to make the $6 per day minimum wage.

It is impossible to talk about brain drain and immigration in Latin America without Venezuela coming to mind. Venezuela’s billions – if not trillions – of dollars lost to graft or repelled by uninviting policy may only be surpassed by the amount lost by the Venezuelans who will not return home. The brightest entrepreneurs, doctors and engineers continue to flee Venezuela to establish lives in cities like Miami and Bogota. In fact, at a time when Spain is struggling with austerity measures in the Eurozone, Venezuela is the only country in Latin America with whom Spain has a positive migrant balance.

International organizations have criticized Venezuela’s statistics agency INE for not publishing data for well over a year. The website was down when I researched this article.

Peruvian applications to obtain residency in Argentina in 2014 fell 5% from the year previous. Argentina’s statistical agency publishes data on immigrants to Argentina, but not on Argentines leaving the country. According to Peru’s INEI data, however, over 2,900 Argentines obtained work visas in Peru through May 2014, up 19% from just over 2,440 over the same period in 2013.

Aside from picking on the region’s disappointing performers, Peru seems to have a positive migrant balance with another shining star from the region, Colombia.

Colombia actually led the international field in professionals receiving visas to work in Peru. Colombia’s net migrant balance according to my methodology, while still low at -3.7%, is years away from becoming a destination country. Meanwhile, Peruvians getting work visas in Colombia fell 17% from 2013 to 2014 while Colombians who obtained work visas in Peru grew a full 20%.

The latest migration report was positive overall, but there are clouds on the horizon. Peruvian press ran with the “12.1% more foreign workers” headline, but that growth rate was actually down from 19.1% in May 2014. Migrant attraction is slowing along with the Peruvian economy.

I once heard a story about two friends who ran after encountering a bear in the woods. One friend says to the other, “I don’t know if we can outrun it. Maybe we can team up to overpower it?” The other replies, “I don’t have to outrun the bear. I just have to outrun you.”

Peru does not have to be a more attractive destination than the United States. By simply being more attractive than the neighbors, Peru can make excellent gains with prospective migrants and investment capital looking for a home within Latin America.

According to a World Bank report, migrants create new lives abroad based on expectations of economic, political and social factors such as poverty and unemployment, wages and standard of living, professional development, safety and security, quality of governance and corruption, political freedom and more.

Peru has attracted migrants because of its improvement in the areas listed above, but the game is never over. An American born since the 1970s would never believe that Mexicans would stop coming to the United States. But then things changed. The Mexican-born population in the United States shrank in 2012 as more Mexicans left the United States than came.

Peru built a diverse base of ethnicity over a century before falling into migrant deficit in just thirty years of military-planned economics, hyperinflation and terrorism. Obviously, the game to improve economic, political and social factors never ends. While nothing may change in Venezuela, Argentina will probably elect a pro-business President this year to complement what may be the region’s most competent populace. Colombia may strike a peace deal with the FARC. Spain may leave the Euro and thrive without it.

Of course each of those would be great for those countries and the region, but Peru will have to continue making gains to stay attractive. Peru must focus on things that could drive Peruvians away such as widespread corruption, extortion gangs, dangerous infrastructure and lackluster education. Peru needs to continue to diversify its economy to reduce its reliance on mining and improve out-of-date web practices.

Adhering to Tony Blair’s rule of thumb may seem simplistic, but making the country an attractive place for both prospective migrants and the citizenry is a foolproof way to continue progress after a boom.

Sources

RESUMEN DE MOVIMIENTOS MIGRATORIOS DE INGRESO Y SALIDA, 2008-2015 (Migraciones)

Evolución del Movimiento Migratorio Peruano – Marzo 2014 (INEI)

Evolución del Movimiento Migratorio Peruano – Mayo 2014 (INEI)

Evolución del Movimiento Migratorio Peruano – Marzo 2015 (INEI)

Evolución del Movimiento Migratorio Peruano – Mayo 2015 (INEI)

Remittances to Developing Countries to Grow by 5 Percent This Year (World Bank)

Peru: Estimaciones y Proyecciones de Población, 1950-2050 (INEI)

LAS MIGRACIONES INTERNACIONALES COMO MOTOR DE DESARROLLO EN EL PERU (Instituto del Peru)

Perfil Migratorio del Perú (International Organization for Migration)

Full text: Tony Blair’s speech (The Guardian)

BOLETÍN MIGRATORIO – MAYO 2015 (Migracion Colombia)

Boletín Semestral de Estadística – Enero – Junio 2014 (Migracion Colombia)

Estadísticas de la Emigración Internacional de Peruanos e Inmigración de Extranjeros, 1990-2012 (INEI)

Maduro’s muzzle (The Economist)

Migration Statistics 2014 (INE Spain)

Net Migration from Mexico Falls to Zero—and Perhaps Less (Pew Hispanic Center)

The impact of migration on sender countries (World Finance)

Determinants of Migration (World Bank)

Economic Effects of Migration (SUNY Levin Institute)

INEI: aumenta en 12% número de extranjeros que llegan al Perú por trabajo (Andina)

SINTESIS ESTADISTICA DE RADICACIONES: Informe especial del Informe especial del Año 2014 (Direccion Nacional de Migraciones)