REMITTANCE PARTNERSHIPS
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1 VANUATU REMITTANCE PARTNERSHIPS
2 OUTLINE An Overview Target Group RSE workers recruitment RSE Estimate Remittances Economic Impacts Challenges and Lessons Conclusion
3 An overview Remittance Market relatively new player compared to other PICS (e.g. Tonga, Samoa & Fiji). Remittance is not significant before RSE The scheme was declared in October 2006 First recruitment t - September New Zealand Fresh Food Exports company - first to recruit (20 workers) To date roughly 3500 Ni Vanuatu benefited from the program. In 2008 the total number of workers was All workers to New Zealand were mainly unskilled labour, primarily engaged in farm work. This was a target group, with the scope to improve employment and living standards for Ni-Vanuatu. Australia Pilot program planned for 50 people initially
4 RSE WORKERS IN NZ Workers in NEW Zealand at end March 09 Other 25% Vanuatu 25% Solomon Islands 6% Samoa 22% Tonga 22%
5 Target Group TARGET GROUP Amongst other Pacific Island nations, the target group is the unskilled workers. - Emphasis was to partly address unemployment issues as well as provide avenue for income through NZ Farm labour. (Individials with a regular jobs do not qualify under the scheme) AGENTS Approved Local Agents, including Agents in News Zealand are involved in the recruitment process. The Department of Labour is the government agency responsible for supervising recruitment CONTRACT EMPLOYMENT Employees are contracted under employment contracts before they leave for New Zealand. Their employment conditions includes following: - This included a one way trip New Zealand paid for by the Employer. Pastoral care services were also provided. d The duration of contract t was on average 5 6 months. Workers are expected to return after each contract..
6 RSE Worker Recruitment as at end June 2009
7 RSE Estimate Remittances(VT) No. VT
8 NUMBER OF EMPLOYEES & REMITTANCE ESTIMATES Net number Remittances of employees earnings/ QTR in (VT) 2008 Qtr ,156,867 Qtr2 1, ,036,419 Qtr ,577,545 Qtr ,652, Qtr1 1, ,910,
9 ECONOMIC IMPACTS NEW ZEALAND PERSPECTIVE Ni Vanuatu under RSE program pays the New Zealand Government an average of 18% of Rate Tax. - special rate for RSE workers (no refund end of employment) Ni Vanuatu under RSE program contribute to services rendered by the New Zealand Government through travel related services, accommodation and other expenditures. A monthly estimate of 140, 000NZD ( 10mvt) paid by ni-vanuatu RSE workers to the New Zealand Government. Increase in Agricultural Production and Exports
10 ECONOMIC IMPACTS VANUATU PERSPECTIVE Despite global recession, the demand for workers in NZ continue to increase. Less pressure on domestic economy Employment for cash trapped rural population Foreign Exchange Income Increase in rural financial Capital and Cash flow Over 500 Million Vatu in Remittances (US$4.8 mn appx) annually.
11 CHALLENGES & LESSONS Cost of Transfer of Remitted Funds are high. Costs can be anything up to 25 percent or remitted Funds. There are concerns over deduction made by Employers for Pastoral Care Services. Government needs to ensure People from the Rural can make good choices when transmitting funds. Some farmers have employed more than required workers. One Solution is the introduction of WESTPAC VISA Card. Other solutions need to bal also considered. Vanuatu needs to ensure that recruitment procedures are transparent to ensure that the scheme can be beneficial to both countries. Affects on tourism - NZ citizens now know more about Vanuatu
12 CONCLUSION The RSE scheme win win project between Vanuatu government and New Zealand government Despite the global downturn spillover effects and the recession in New Zealand, Vanuatu s RSE inflows from New Zealand had been generally sustained. Vanuatu RSE had been able to meet NZ Labour Marker Strategy It is anticipated i t that t this Temporary Migration Programs (TMPs) will be extended to other resourceful economies as well. Future outlook is promising, but there are challenges ahead for Vanuatu, e.g. domestic needs vs. RSE
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