The Impact of Dual Citizenship on Poverty Reduction in Armenia

Hasmik HovhanesianYerevan State University

UNDP -- CRRC Armenia -- Eurasia Partnership Foundation

Goal of the Research

Assessing how dual citizenship (DC) could have an influence on

poverty reduction

Classification Code: 015Key Words: Diaspora, Poverty Reduction, Dual Citizenship, Armenian Diaspora

Content

Definitions of the Major Terms Used During Research

Theoretical Approach toward a Diaspora’s Role in Poverty Reduction

The Role of Dual Citizenship in the Economy of the Home Country (the Indian Case)

The DC Impact on the Diaspora’s Role in Poverty Reduction in Armenia

The Results of the Survey Policy Recommendations

Research Methodology -- For qualitative

a/ case studyb/ grounded theory

-- For quauntitive

a/ hypothesis test b/ Regression analysis c/ Logical Framework Approach

-- For Mixed-Methods

-- Logical Framework Approach

Major Terms Used

Poverty Reduction with poverty and economic growth

Dual Citizenship Diaspora and Armenian Diaspora

What is negative?

a source of financing for international terrorism

easily manage the politics of home country without living there

the major diaspora communities’ interests

Outcomes of review of literature

Macro production function – Y=AKaLa-1, where Y is total production, A is multifactor productivity (technology), K is capital, L is labor and a is relative capital intensity (0<a<1)

GDP equation – Y=C+G+I+Xn, where C is private, while G is public consumption, I is represent investment or savings and Xn is net exports

Saving functions – I=sY, where I is a portion s of the total production Y

Change in Capital – ΔK=sY – ðK, where ð is the rate of depreciation; and

Change in Workforce – Lt+1=Lt(1+gL), where gL is the growth function for L – gL=ΔL/L.

Impact of Diaspora on home country’s economy

Remittances Investments Promoting home country products in

the world market Acting as a tourist Knowledge transfer Lobbying for receiving foreign

governments’ grants, loans and/or assistance

New methods and approaches For Diaspora to be involved into poverty reduction process

Diaspora as a bridge between foreign investors and/or buyers and the home country

E-networking

Institutionalization

Diaspora as a “live business card”

Sense of ownership

These links will work if there is an implemented governmental strategy

Economic Growth

Labour1. Internal2. Diaspora

Technology

Capital

Foreign Trade

Diaspora

Government Policy

Impact of Diaspora

Why INDIA ????????

It is different from Armenia, but succeed more in Diaspora involvement into poverty reduction process

It has different culture, religion, language, but still Diaspora is actively involved in economic development process of India

Globalization carries tendency to unify the values

“Among the biggest world billionaires, there are seven Indians. Among US millionaires, there are 200,000 Indians.”-S. Prasad

Actions of Indian Government

“Non-Resident Indian” Special Coordination Division in the Ministry of External Affairs. Consultative Committee for Non-Resident Indians Global Organization of People of Indian Origin First Global Convention of People of Indian Origin High Level Committee on the Indian Diaspora

The Person of Indian Origin Card

Overseas Citizen of India

(i) Multiple entry, multi-purpose life-long visa to visit India(ii) Exemption from reporting to Police authorities for any length of stay in India; and(iii) Parity with Non Resident Indians (NRIs) in financial, economic and educational fields except in the acquisition of agricultural or plantation properties.”

“The overseas Indians would scout

opportunities, represent ‘Brand India’, network

for Indian initiatives. They would be the flag

bearers. They will help Indian initiatives. They

will help India shift from being a local player to

being a global major”

India Inc.

FDI of India

Year 2003 2004 2005 2006

FDI (mln USD) 4 323 5 771 6 676 16 881

Number of Indians Living in Major Investment-Making Countries

Country Number of Indians Living There

Mauritius 855,000

USA 2,200,000

UK 1,400,000

Singapore 320,000

The Netherlands 217,000

Exports of IndiaCountry 1991-2000 2000-2001 2005-2006 2006-2007

Bangladesh 636 USD mln 935 1,664 1,627

Belgium 1,367 1,471 2,871 3,471

Canada 578 656 1,022 1,109

China 539 831 6,759 8,287

France 897 1,020 2,080 2,099

Germany 1,738 1,907 3,586 3,976

Italy 1,119 1,309 2,519 3,580

Japan 1,685 1,794 2,481 2,860

The Netherlands 886 880 2,475 2,668

Saudi Arabia 742 823 1,810 2,586

Singapore 973 877 5,425 6,064

Spain 548 666 1,606 1,876

Sri Lanka 499 640 2,025 2,254

Thailand 450 530 1,075 1,443

UAE 2,083 2,597 8,592 12,023

UK 2,035 2,299 5,059 5,614

USA 8,396 9,605 17,353 18,851

The Diaspora first of all has to solve its daily life problems and the young generation is more business targeted.

Khatchik Toloyan

Major Poverty Figures from 2001-2006 (%)

2001 2002 2003 2004 2005 2006

Poor Poor Poor Very Poor Poor Very Poor Poor Very Poor Poor

% of Poor in Armenia

50.9 49.7 42.9 6.4 34.6 4.6 29.8 4.1 26.5

Unemployment Rate In Armenia from 2001-2006

2001 2002 2003 2004 2005 2006

Unemployment Rate 10.3% 9.4% 10% 9.4% 9.6% 7.4%

Activities of Government of Armenia

Pan-Armenian Games Diaspora-Armenia economic conferences Investment conferences in USA, Europe

and Russia Celebration of the 1700th anniversary of

Armenia’s adoption of Christianity Ministry of Diaspora Special Status DC

The Case of DC in Armenia

According to the constitutional amendments of the Republic of Armenia (RA) adopted on 5 December, 2005, “A person of Armenian ethnicity may acquire RA citizenship pursuant to a simplified procedure” (Article 11.3) and “the rights and obligations of a person with DC would be regulated by the appropriate law” (Article 30.1).

Any person 18 years of age and capable of working who is not an RA citizen may apply for RA citizenship, if he/she:- has been lawfully residing on the territory of the Republic of Armenia for the preceding 3 years- is proficient in the Armenian language- is familiar with the Constitution of the Republic of Armenia

There are two major requirements for acquiring Armenian citizenship: to present an appropriate document proving Armenian nationality and to pass an exam in the Armenian language on the Constitution of the Republic of Armenia.

Results of Survey

Country Respondents

Australia 1

Bulgaria 1

Canada 4

Cyprus 2

France 9

Georgia 4

Iran 6

Iraq 2

Jordan 1

Lebanon 11

Russia 7

Syria 7

Turkey 2

UK 1

USA 12

Total 70

Respondents Aged 30+

Respondents under the Age of 30

Country Respondents

Cyprus 1

Egypt 1

France 1

Iran 10

Iraq 2

Lebanon 1

Russia 2

Syria 2

USA 2

Canada 1

Georgia 17

Greece 1

Total 41

Respondents Aged 30+

58.6% - know about DC of Armenia 60% of - would apply for DC 81% of the respondents who answered “No” - have

a positive approach towards DC 59% - support the creation of a separate

government 47% - support changes in the laws related to the

Diaspora and/or business in Armenia 31% of - have businesses in Armenia, but 50% of

them will not apply for DC. Who does not have a business in Armenia- 30% expressed willingness to start one

Respondents under the Age of 30

90% - expressed their readiness to participate in their home country’s poverty reduction process mainly through establishing businesses (44%) and charitably (almost 20%)

66% - do not know about DC of Armenia 80% - are sure that there should be a separate

government body for dealing with the 35% - stand for changes in the laws and regulations

related to the Diaspora 10% of these people will apply for DC, but prefer

not to have DC as it is not beneficial to them

Outcomes

Diasporas impact all four factors of economic growth of the home country: labour, capital, technology and foreign trade

Diasporas as external sources of labour daily and persistent activities from the government

of the home country new approaches should be used besides traditional

methods to involve Diaspora into poverty reduction process of home country

Not Armenian Diaspora, but Transnational Armenians.

Armenian citizenship should provide benefits besides obligations

sense of ownership among transnational Armenians Creation of separate body, but only in case of exact

strategy

Special Thanks

Heghine Manasyan Asbed Kotchikian

Sona Hamalian Dzovinar Derderyan

UNDP CRRC Armenia Staff

Armenian Development Agency Yerevan State University

June, 2008