Refugee livelihoods and engagement with host economies / Humanitarian Innovation Project

07/03/14

Contrary to popular perception, refugees’ economic lives by no means exist in a ‘vacuum’, shut off from the wider economic structures of their host country. Indeed, no refugee camp, regardless of how remote its location, is ever fully closed to traffic in goods, capital and people from outside.

In urban settings, self-settled refugees are tied to the larger host economy even more directly. While existing studies have identified broad connections between refugees and external economies, little is known in detail about how, and in what ways, refugees are linked with local, district or regional economic actors in a refugee-receiving state.

To fill in this analytical gap, the Humanitarian Innovation Project has, over the last year, conducted fieldwork in Uganda across three sites: Kampala, Nakivale and Kyangwali refugee settlements. Our findings, in turn, offer valuable and intriguing insights into the complex modalities of engagement which play out between refugees and the Ugandan host economy.

Uganda represents a popular destination for refugees in East Africa – as of 2013, the country accommodates more than 200,000 refugees and asylum seekers of various nationalities. In Uganda’s capital, Kampala, alone, approximately 50,000 refugees make their living through various patterns of engagement with city business sectors.

For instance, a considerable number of Congolese refugees are involved in trading of accessories and ‘bitenge’, a colorful textile. These refugees purchase their goods from Ugandan wholesalers, who in turn import from across Africa, China, India and the Netherlands. The refugee vendors not only hawk around in Kampala but also travel all the way to major commercial hubs outside the capital, including border towns with the Democratic Republic of Congo (DRC), Kenya, Tanzania and South Sudan.

While these bitenge-and-jewelry-selling Congolese refugees are indeed ‘petty traders’, they are nonetheless embedded in wider global supply chains stretching across Uganda and beyond. Nor, as is often assumed to be the case in understanding of refugee petty trade, does this economic activity exist in competition with nationals. Instead, according to Ugandan wholesalers, Congolese retailers are both important customers and crucial distributors who carry their goods throughout the country and across its borders.

As another example, Somali refugees in Kampala engage with the host economies through their ethnic connections. In Uganda, some of the country’s major businesses in oil, transportation and trading sectors are owned by Ugandans of Somali origin. A common observation in our research was that Somali refugees in Kampala often find employment opportunities among such Somali-owned private businesses. One Somali Ugandan-owned oil company alone, City Oil, employs nearly 60 Somali refugees as shop keepers, cashiers, security guards and clerks at one of its franchises in Kampala. In this pattern of engagement, refugees are again seen to participate in and contribute to the host private sector as employees.

Even in settlements physically far removed from urban commercial centres, refugees’ livelihoods are deeply nested in district and regional Ugandan economies. Both Kyangwali and Nakivale settlements are situated in rural localities with soil rich for crop-growing; as such, the most common livelihood strategies among refugees in both settlements are agricultural, primarily the growing of maize, beans, sorghum, cassava and potatoes. The surpluses of agricultural crops regularly attract hundreds of Ugandan traders, who purchase these goods for resale in markets surrounding the settlements, in the district capitals of Mbarara and Hoima, and as far away as Kampala. For these Ugandan merchants, refugee farmers are one of the most important suppliers for their trading business.

In rural settlement areas, refugees also serve as the main customers of local Ugandan businesses, who make daily trips to the settlements not only to buy, but also to sell. Ugandan wholesalers from Hoima, Mbarara and Kampala bring their merchandise and distribute it via refugee retail shops in both Kyangwali and Nakivale settlements. Many refugees’ businesses in the settlements thus operate as a direct part of the distribution channels of local enterprises.

These brief examples illustrate some important implications for informing and deepening existing debates in forced migration studies and policy. There is, for instance, a long-standing debate over whether the burden on a host community or state of hosting refugees outweighs the benefits of accommodating them – the so-called ‘burden’ or ‘boon’ debate. In the current refugee policy arena, the number of stakeholders who see refugees as an economic burden outnumber the advocates of refugees as potentially valuable contributors to their hosts’ economies.

Our research findings ground this debate by providing concrete evidence of refugees’ contributions to the host economy. As illustrated above, many refugees in Uganda play multiple contributory roles within the structures of local industries and markets, with a considerable number of Ugandan businesses heavily reliant on refugees as their suppliers, customers, distributors and employees. This evidence would seem to argue strongly against the simplistic perception of refugees as a negative ‘burden’ on their host economies, while also speaking to the complexity of the myriad forms of economic agency displayed by these same populations.

The ultimate aim of our research going forward is to develop a better understanding of ‘refugee economies’ by disentangling how and in what way refugees’ daily economic activities are linked with the economic systems in the refugee-receiving country. We believe that this understanding will also inform humanitarian practice to better support livelihoods for refugees and to foster their self-reliance, which is a major ‘missing link’ in the current refugee policy arena.

Naohiko Omata and Josiah Kaplan

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