A new survey by IOM finds that remittances sent by the Serbian
diaspora in Switzerland play an important role in poverty
alleviation among older, rural households with low levels of
education and an income of less than 1,000 Swiss francs (CHF) per
month.

The survey carried out by IOM among 343 households in Petrovac
na Mlavi and Cuprija, two rural migrant-sending regions of Central
and Eastern Serbia, finds that remittances sent by the 200,000
strong Serbian diaspora in Switzerland contribute mainly to the
acquisition of housing or are used to support recurring living
costs and basic needs such as water, electricity, gas, food,
medicine, healthcare and, to a lesser extent, children's education.
About 8 per cent of respondents said they invested part of their
remittances in small to medium-sized enterprises (SMEs).

Remittances from Switzerland are part of a larger flows
estimated by the International Monetary Fund in 2004 to reached USD
4,1 billion, or 17.2 per cent of Serbia's GDP, placing Serbia in
the top 11 remittances receiving countries in the world.

At the micro-economic level, the impact of remittance flows to
Serbia is confirmed by the fact that more than 90 per cent of the
surveyed households receive remittances, which on average total CHF
4,800 per year. The survey also underlines that households also
receive goods such as household equipment, mobile phones and
televisions, as well as machinery for agricultural activities.

The survey finds that remittances, which can account for 40 per
cent of household income, are mostly sent informally on a monthly
basis. They are either hand-carried by migrants, friends or
acquaintances or sent via a vast network of bus drivers who shuttle
between Serbia and Switzerland on a daily basis.

This use of informal channels can also be explained by a lack of
trust in Serbian financial institutions and by high remitting
costs.

To increase the flow of remittances through formal channels, the
survey underlines the need to reduce remitting costs. This can be
done by setting up new partnerships between financial service
providers in Switzerland and Serbia, by improving banking
provisions to bring more people into the formal banking system and
by setting up special savings to encourage investments in SMEs to
create employment in Serbia and help the country retain its skilled
young professionals.

Other measures, including new banking policies and financial
legislation that allow expatriates to hold foreign currency
accounts in Serbian banks could encourage expatriates to invest
remittances in enterprises that would benefit Serbia's poorer
regions.

The survey notes the need to support efforts deployed by the
Serbian Ministry for Diaspora to encourage collective donations
from migrant associations in Switzerland that wish to support
community infrastructures, such as roads, water systems or schools
for special needs children. This, the report concludes, can be
achieved through the setting up of matching fund schemes. 

"This survey is funded by the Swiss Secretariat for Economic
Affairs (SECO) and is one of a three-part investigation of
migration and remittances linking Switzerland to Serbia carried out
by IOM, the Swiss Forum for Migration and Population Studies (SFM)
and the European Bank for Reconstruction and Development
(EBRD). 

The IOM survey is available at "paragraph-link-no-underline" href=
"/jahia/webdav/shared/shared/mainsite/published_docs/mrs28.pdf"
target="_blank" title="">www.iom.int

A summary of the three-part investigation can be found at class="paragraph-link-no-underline" href=
"http://www.seco-cooperation.admin.ch/shop/00008/02002/index.html?lang=en"
target="_blank" title=
"">http://www.seco-cooperation.admin.ch/shop/00008/02002/index.html?lang=en

For further information, please contact:

Jennifer Petree

IOM Geneva

Tel: +41 22 717 93 76

E-mail: "mailto:jpetree@iom.int" target="_blank" title=
"">jpetree@iom.int

Nilim Baruah

IOM Geneva

Tel: +41 22 717 94 72

E-mail: "mailto:nbaruah@iom.int" target="_blank" title=
"">nbaruah@iom.int