The Gambian government has reached an agreement to send skilled and domestic workers to Saudi Arabia, with the Minister of Trade, Industry, and Employment highlighting this initiative as a response to the high unemployment rates among Gambian youth and women. A key underlying assumption is that the primary motivation for many of these workers is the expectation of relatively higher normal wages, in addition to finding employment. As economists, our focus should be on analysing the potential risks and benefits associated with part of our workforce migrating to Saudi Arabia’s labour market, with emphasis on the economic implications.
Historically, Gulf countries have faced global criticism for human rights violations against migrant workers, an issue indirectly admitted by the Minister in his deliberations. Employers in the region have been accused of severe mistreatment, including cases of forced labour, sex trafficking, and domestic servitude, where workers are held incommunicado and have their travel documents seized to ensure long-term captivity. Even those fulfilling the terms of their actual employment contracts reportedly work in hazardous conditions and extreme heat, leading to severe physical and mental health consequences, and in some cases, loss of life, as reported by Amnesty International and the Vital Signs Project in the build up to the Qatar World Cup. Saudi Arabia, however, is not notorious for such accusations, with the country governed by Islamic Law – Shari’ah.
In addressing the National Assembly, the Minister stated that both the Gambian and Saudi governments are committed to ensuring that this partnership operates under fair conditions for Gambian workers, with competent agencies tasked to recruit qualified workers, while the Gambian Department of Labour oversees the terms of employment contracts. In my view, this assertion, by itself, is a signal for the potential risks of unfavourable working conditions, thus necessitating safeguards to reassure and build confidence in the prospective migrant workers. It therefore remains important to clarify the roles and responsibilities of both governments, particularly regarding protections against worker abuse or breaches of contract by employers, and the mechanisms for enforcement and accountability.
From a human capital standpoint, there could be risk of “brain drain,” considering that part of the workers would be skilled workers. This can have a detrimental impact on The Gambia, particularly when it involves highly skilled professionals from several sectors of the economy. For instance, if a substantial proportion of skilled workers, such as engineers, constructors, metal workers or even healthcare professionals, migrate to Saudi Arabia, we risk losing valuable human capital that could have been crucial for our own development. Industries where specialised skills are scarce, the departure of trained professionals can create a skills gap, slowing down productivity and expansion of our economy. Moreover, the migration of skilled workers can have broader social consequences. For example, the departure of construction workers, engineers or carers could weaken their respective sectors, leading to lower quality attainment if their replacement is not immediate. Over time, brain drain could undermine the government’s efforts to achieve sustainable economic growth, as the loss of expertise and talent limits the potential for industrial development and service delivery.
Nonetheless, there is potential for significant economic gains from this agreement. First, it is essential to note that the impact of brain drain is not always entirely negative. The potential for “brain circulation” exists, where migrants return home after gaining valuable additional skills, experiences, and capital abroad. This could bring new knowledge, innovation, and ideas into The Gambia, helping to bridge the skills gap. The workers who maintain ties with the country could facilitate the transfer of knowledge, technology, and new ideas.
Additionally, relying on the assumption of higher nominal wages in Saudi Arabia, the migrants will have improved financial situations. The higher wages for migrant workers mean they can send remittances back home, benefiting both them and the economy. For them, higher incomes enable savings and investments in future businesses, providing long-term financial security. At the macroeconomic level, the benefits are manifold. Remittances sent home improve household welfare and boost consumption, leading to higher aggregate demand. Increased savings by these workers could contribute to greater domestic investment, either directly or through lending, which in turn may drive job creation. This could lead to a rise in employment, further boosting consumption demand, savings, and overall economic growth.
Furthermore, a strand of economic literature supports the positive impact of migrant workers on their home countries. Gupta et al (2009) have found that remittances contribute to increased foreign exchange reserves, offering a stable source of external financing and strengthening the country’s balance of payments. Also, emigration reduces domestic unemployment by shrinking the labour force, particularly in economies with a surplus of labour, as found by Docquier and Rapoport (2012), while the outflow of workers could raise wages for those remaining by increasing their bargaining power and demand for their skills (Mishra, 2007). Moreover, Rauch and Trindade (2002) found that diaspora networks formed by migrant communities foster economic linkages, encourage international trade, and facilitate the transfer of knowledge and capital, all of which contribute to the long-term development of the source country.
In a nutshell, the decision to send Gambian workers to Saudi Arabia is a positive step, but it is essential to establish protective measures that safeguard the rights and dignity of these workers. It is crucial for the Gambian government to manage the potential risks of human rights abuses and check the potential effect of brain drain and brain circulation by ensuring that skilled workers are not disproportionately affected, and by implementing policies that encourage the return of talent or ensure the transfer of skills and resources back to the country. However though, key questions that one may ask at the end of this discourse are “how many workers will migrate to Saudi Arabia, and what proportion of them are already employed or unemployed in The Gambia? How long would the economic effects begin to manifest”? To answer these, it would be prudent for the Ministry and its partner agencies to maintain accurate and timely data on the migrant workforce to Saudi, and related economic indicators, enabling future impact assessments and informing future agreements with other partner countries.
Goodluck!
