Rapid Remittance Assessment in Bamyan and Wardak
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SPECIAL REPORT: Rapid remittance assessment in September 2012 Bamyan and Wardak Provinces Dependency on income from labor migration to Iran has decreased significantly over the past decade Key Messages Figure 1. Projected food security outcomes, October to December 2012 In Bamyan and the northern districts of Wardak Province, dependency on income from labor migration to Iran has decreased significantly over the past ten years. This gradual trend has accelerated during the last three years. The reduction in the number of labor migrants going to Iran is primarily a result of increased domestic employment opportunities since 2001, Iran’s restrictions on labor in-migration, and the deteriorating economy of Iran. A noticeable proportion of the population of Bamyan and the northern districts of Wardak Province have permanently moved to urban areas including Kabul, Hirat, and Mazar. The remaining population thus has increased access to natural resources such as arable Source: FEWS NET Afghanistan land, pasture, and water from irrigation. This map represents acute food insecurity outcomes relevant for emergency decision-making. It does not necessarily reflect chronic food insecurity. Visit www.fews.net/FoodInsecurityScale for more information. Given the better than normal production in 2012 which will contribute more than six months’ food supply for households, normal income from cash Figure 2. Assessed areas, rapid remittance assessment, August and September 2012 crops sales such as for potatoes, the 45 percent increase in sheep and goats prices compared to last year, food security outcomes for Bamyan and northern districts of Wardak province will be at the None or Minimal food insecurity phase (IPC Phase 1) over the coming six months. While not expected in the most likely scenario, if Iran were to forcibly repatriate Afghan labor migrants, the impact on once-dependent provinces such as Bamyan and the northern districts of Wardak food security would impact some households, but it would not likely affect entire villages or have particularly large- scale impacts. Source: FEWS NET Afghanistan This report provides an update to the July 2012 FEWS NET Food Security Outlook for Afghanistan which estimated food security conditions from July to December 2012. The next Outlook report will be released in October and will cover the October 2012 to March 2013 period. FEWS NET Afghanistan FEWS NET Washington Kabul 1717 H St NW FEWS NET is a USAID-funded activity. The authors’ views expressed in this publication do not necessarily reflect the view of the United States Agency Washington DC 20006 for International Development or the United States Government. [email protected] www.fews.net/afghanistan SPECIAL REPORT: Rapid Remittance Assessment in Bamyan September 2012 and Wardak Provinces Background Early in the spring in March and April, the wheat harvest prospects were widely estimated to be above average over most of the country with exceptions in high elevation areas of the central highlands and the northeastern mountains. In those areas, temperatures had been well below normal during most part of the wet season since late November 2011. As a result, crops growth had been slower than normal in the central highlands and extreme northeastern mountains. Some local farmers were worried about potential grain crop failures. This situation became a source of concern, and the food security outcomes in the central highlands if the wheat harvest was poor because of the cold temperatures required further investigation. In addition to crop and livestock production, existing livelihoods information indicated that the east-central mountainous agropastoral livelihood zone depends heavily on income from labor migration with labor income, including income from temporary migration both abroad and domestically along with remittances from labor migrants, being the largest, single source of income for poor households. The area was believed to send a large number of migrants to Iran, among other income generating strategies to produce income to buy food. Market purchases often provided more than half of a household’s food. A 2008 study by the International Labor Organization (ILO) and the U.N. High Commissioner for Refugees (UNHCR) estimated that remittances from Afghan labor migrants in Iran totaled around 500 million U.S. dollars (USD) per year and up to six percent of Afghanistan’s gross domestic product (GDP). In January 2012, new sanctions from several countries targeting Iran’s oil exports contributed to increased inflation in Iran, large exchange rate fluctuations of the Iranian rial (IRR), and rising unemployment. In the early spring in March and April, anecdotal reports from the central highlands indicated that a significant reduction in the level of poor households’ income had possibly already occurred as remittances from labor migrants in Iran decreased or ceased completely. With risk of a poor grain crop damaged by the cold and a potentially very large reduction of remittances, a rapid remittance assessment was undertaken by FEWS NET to better understand the extent of the remittance reduction, the ability of households to cope with changes to remittances, and the implications of changes this year for food security outcomes in a part of the country known for chronic food insecurity and a large number of very poor households. Methodology The rapid remittance assessment was a qualitative assessment using the methods of rapid rural appraisal (RRA) also known as participatory rural appraisal (PRA) to gain information on key trends and household-level outcomes. It does not represent a generalizable, scientific sample of the entire population of the central highlands, nor is it able to capture every individual household’s situation or the immense variation in conditions between all the villages in the central highlands. However, at the level of the livelihood zone, it can provide a general picture of remittances, other typical and atypical livelihood strategies being employed this year and over the past few years, and any livelihood adaptations being made by the residents of Bamyan and the northern districts of Wardak Province. Participatory, guided interviews were conducted with 15 focus groups consisting of between 50 and 60 people, primarily men. Participants in the focus groups, the key informants, included local government officials, representatives of local and international non-governmental organizations (NGOs) working in particular villages, money changers, and village elders. In addition to the larger focus group interviews, in order to triangulate findings from the larger groups, additional interviews were held with 10 heads of households in the targeted villages. Phone interviews also were held with four labor migrants in Iran, in the presence of their household members to whom they remit money, to better understand the dynamics of labor migration and the decisions households make regarding remittances, other labor migration options, and other income- earning livelihood strategies. Government officials, NGO representatives, and village elders were asked about what role remittances played in poor households’ income over the past 10 years, in order of magnitude and as compared to other potential sources of income. Also, key informants were asked how sources of income had evolved both over the entire mentioned period and with a particular focus on the last three years when Iran’s economy has encountered new challenges. In addition to the inquiry into remittances, other questions focused on livelihood strategies that had been newly adopted or coping strategies that Famine Early Warning Systems Network 2 SPECIAL REPORT: Rapid Remittance Assessment in Bamyan September 2012 and Wardak Provinces could be employed by poor households to counterbalance falling income from remittances. Data were also collected from household heads about the proportion of different sources of income, both for this year and over the past three years. Local money changers who transmit remittances to rural areas through hawala transfers were interviewed to understand what the changes to the total volume of remittances per year were three years ago and so far this year. Additionally, locally used exchange rates for converting Iranian rial (IRR) to Afghan afghani (AFN) over time were gathered from money changers to understand the scale of the lost value as the IRR depreciated against the AFN. Afghan labor migrants in Iran were interviewed by phone to understand their labor wages at present as well as over the last three years of working in Iran. Similarly, questions about the minimum living cost per labor migrant in Iran over the last three years were asked to better understand the impact of inflation in Iran was having on remittances to Afghanistan. Though the assessment’s focus was on remittances, specifically remittances from Iran to the eastern parts of the central highlands, efforts were made to better understand 2012 crop production, the contribution of crops to household’s sources of food, other key livelihood activities, and the status of particularly vulnerable groups in Bamyan and the northern parts of Wardak Province. Key findings Twelve years ago, during the time of the civil war and during the persistent dry years from 1995 until 2002, remittances from Iran may have made up to 90 percent of total cash income for poor households in the eastern areas of the central highlands. Remittances were the key source of cash both for covering survival and livelihood protection needs.