tag:theconversation.com,2011:/ca/topics/visa-17150/articlesvisa – The Conversation2022-11-15T19:24:22Ztag:theconversation.com,2011:article/1935002022-11-15T19:24:22Z2022-11-15T19:24:22ZHow Canada’s new credit card surcharge will affect consumers and businesses<figure><img src="https://images.theconversation.com/files/495174/original/file-20221114-13-16khi0.jpg?ixlib=rb-1.1.0&rect=0%2C73%2C2561%2C1384&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Visa and Mastercard both recently agreed to remove their no-surcharge rule, leaving businesses free to pass these fees along to customers.</span> <span class="attribution"><span class="source">(Shutterstock)</span></span></figcaption></figure><iframe style="width: 100%; height: 100px; border: none; position: relative; z-index: 1;" allowtransparency="" allow="clipboard-read; clipboard-write" src="https://narrations.ad-auris.com/widget/the-conversation-canada/how-canada-s-new-credit-card-surcharge-will-affect-consumers-and-businesses" width="100%" height="400"></iframe>
<p>Canada has some of the <a href="https://www.retailcouncil.org/payment-and-credit-card-fees/">highest interchange fees in the world</a>. Interchange fees are the fees businesses pay each time their customers pay by credit card. </p>
<p>The <a href="https://www.retailcouncil.org/payment-and-credit-card-fees/">average interchange fee in Canada is about 1.5 per cent</a> of the transaction value, with fees typically falling between <a href="https://www.helcim.com/visa-canada-interchange-rates/">one and 2.5 per cent</a>. The <a href="https://www.bigcommerce.com/ecommerce-answers/what-are-interchange-fees-and-how-are-they-calculated/">makeup of these fees can be complex</a>, but they <a href="https://creditcardgenius.ca/blog/credit-card-processing-fees">generally end up with the issuing bank</a>. Credit card networks receive a much smaller proportion of the transaction.</p>
<p>Up until last month, credit card networks <a href="https://www.visa.ca/content/dam/VCOM/download/about-visa/visa-rules-public.pdf">did not allow businesses to pass these fees to customers</a>. That recently changed with the <a href="https://www.creditcardsettlements.ca/">settlement of a class-action lawsuit</a> that alleged certain banks and credit card networks conspired to set high interchange fees and prevent businesses from adding surcharges or refusing high-cost cards.</p>
<p>Several banks, along with Visa and Mastercard, admitted no fault but <a href="https://bit.ly/3X47q7a">agreed to contribute to a $188 million settlement fund</a> that will be dispersed to Canadian businesses that have accepted Visa or Mastercard since 2001. </p>
<p>In response to the lawsuit, <a href="https://www.creditcardsettlements.ca/docs/en/SettlementAgreements/Visa%20Settlement%20Agreement.pdf">Visa</a> <a href="https://www.creditcardsettlements.ca/docs/en/SettlementAgreements/Mastercard%20Settlement%20Agreement.pdf">and Mastercard</a> agreed to remove their no-surcharge rule, leaving businesses free to pass the interchange fee to their customers. For example, on a $50 purchase, a consumer could pay a credit card surcharge of up to $1.25.</p>
<p>So, what does this mean for Canadian consumers and businesses? Now that businesses are allowed to, will they add a surcharge to cover credit card fees or will they continue to absorb the cost? What should businesses know about consumers’ reactions to surcharges? And what are the costs and benefits of credit card surcharges for consumers?</p>
<h2>Predicting customer reactions</h2>
<p>To help businesses predict how consumers will react to credit card surcharges, we can turn to behavioural economics, which combines elements from economics and psychology to understand how and why people behave as they do in the marketplace.</p>
<p>Behavioural economics has long noted that people show <a href="https://doi.org/10.1037/0003-066X.39.4.341">strong diminishing reactions to both losses and gains</a>. This means, for example, that the pain of a $10 loss is much greater than a tenth of the pain of a $100 loss. A surcharge will <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2901808">almost certainly enhance the “pain of paying”</a> compared to including the fee in the overall price. </p>
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<img alt="A hand holding a credit card reaching out toward a credit card reader machine, which is held by a worker wearing an apron" src="https://images.theconversation.com/files/495175/original/file-20221114-19-p1c7ln.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/495175/original/file-20221114-19-p1c7ln.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=323&fit=crop&dpr=1 600w, https://images.theconversation.com/files/495175/original/file-20221114-19-p1c7ln.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=323&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/495175/original/file-20221114-19-p1c7ln.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=323&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/495175/original/file-20221114-19-p1c7ln.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=405&fit=crop&dpr=1 754w, https://images.theconversation.com/files/495175/original/file-20221114-19-p1c7ln.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=405&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/495175/original/file-20221114-19-p1c7ln.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=405&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">No one blames businesses for adding tax, but there is a strong possibility customers will blame businesses if they add credit card surcharges.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
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<p>As a teenager working in our family furniture business in the U.K., I recall the time a customer angrily threw his credit card at my mother after she informed him of our credit card surcharge. But the psychology of losses and gains doesn’t provide the whole picture here — part of the reason the customer was so angry was because he <em>blamed us</em> for the surcharge.</p>
<p>This is a reaction that businesses should rightly fear. <a href="https://doi.org/10.1016/S0148-2963(01)00231-4">Blame can dramatically enhance perceptions of unfairness</a>. No one blames businesses for adding tax, but there is a strong possibility customers will blame businesses if they add credit card surcharges. </p>
<p>This means consumers are unlikely to support credit card surcharges, <a href="https://creditcardgenius.ca/blog/telus-credit-card-fee-increase-2022">especially if they are simply added to existing prices</a>. In fact, the <a href="https://www.gov.uk/government/news/card-surcharge-ban-means-no-more-nasty-surprises-for-shoppers">U.K. banned credit card surcharges in 2018</a> on the basis that surcharges were simply a “rip-off fee.” </p>
<h2>Suggestions for businesses</h2>
<p>Although businesses can make an educated guess about how customers will react to surcharges, it is difficult to fully predict. To play it safe, most businesses in Canada will probably refrain from adding a surcharge for credit card use for the time being. </p>
<p>According to a <a href="https://www.cfib-fcei.ca/en/media/power-to-surcharge-on-credit-cards-coming-soon">Canadian Federation of Independent Business survey</a>, most businesses either don’t plan to add the surcharge (15 per cent), aren’t sure whether they should (40 per cent) or will simply follow what others in their industry do (26 per cent). About one in five businesses (19 per cent) said they do intend to use the surcharge.</p>
<p>For businesses that are contemplating using the surcharge, there are better ways to implement it than simply tacking it on to existing prices. One approach involves <a href="https://doi.org/10.1007/978-1-4613-2391-4_2">reframing the situation for consumers</a> by offering a discount for cash or debit, instead of adding a surcharge for credit cards.</p>
<p>For the same reason a separate credit card surcharge enhances the “pain of paying,” adding a discount — typically perceived as a small, separate gain — will have an outsized <em>positive</em> impact on customers’ reactions.</p>
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<img alt="A woman handing a handful of bills to a cashier" src="https://images.theconversation.com/files/495176/original/file-20221114-19-8fp2u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/495176/original/file-20221114-19-8fp2u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=362&fit=crop&dpr=1 600w, https://images.theconversation.com/files/495176/original/file-20221114-19-8fp2u.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=362&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/495176/original/file-20221114-19-8fp2u.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=362&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/495176/original/file-20221114-19-8fp2u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=455&fit=crop&dpr=1 754w, https://images.theconversation.com/files/495176/original/file-20221114-19-8fp2u.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=455&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/495176/original/file-20221114-19-8fp2u.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=455&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Businesses could offer customers discounts for paying with cash or debit, instead of adding a surcharge for credit cards.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
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</figure>
<p>Although prices could be adjusted so this process ends up being objectively identical to an added credit card surcharge, a cash discount is also much less likely than a surcharge to be considered unfair by credit card users.</p>
<p>A second option is for businesses to reduce their prices before adding the surcharge, making sure customers are aware of the reduction. As long as customers perceive that a business has made efforts to lower prices first, a credit card surcharge is more likely to be seen as a charge <em>imposed</em> on the business, rather than an attempt by the business to boost profits.</p>
<h2>Fees improve decision-making</h2>
<p>If implemented appropriately, surcharges also have the potential to improve consumer decision-making by allowing consumers to make better decisions about their credit card use.</p>
<p>Credit cards provide benefits for consumers at a cost. In exchange for convenience, credit, rewards, and other perks, customers pay annual fees, interest, and — embedded in prices — interchange fees.</p>
<p>Currently, interchange fees, which are substantial, are <a href="https://www.bloomberg.com/opinion/articles/2022-08-03/credit-card-rewards-aren-t-free-shoppers-don-t-care">hidden from consumers</a>, meaning consumers cannot fully account for the costs of their decision. Not only that, cash and debit card-paying customers cannot avoid interchange fees when businesses are forced to include them in prices despite receiving none of the benefits. </p>
<p>Credit card surcharges, then, would allow consumers to avoid the cost if they don’t perceive the benefits to be sufficient. In other words, surcharges or cash discounts could actually help consumers make better decisions by allowing them to appropriately account for the costs of credit card use.</p><img src="https://counter.theconversation.com/content/193500/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Laurence Ashworth does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Businesses can now pass credit card surcharge fees along to their customers. To help businesses predict how consumers will react to credit card surcharges, behavioural economics offers some answers.Laurence Ashworth, Professor, Marketing, Queen's University, OntarioLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1576482021-04-12T15:54:11Z2021-04-12T15:54:11ZCOVID-19 might encourage more people with working holiday visas to apply for Canadian permanent residency<p>Overseas <a href="https://www.blogto.com/city/2021/03/canadians-cancel-holiday-travel-plans-long-weekend/">holidays</a> and <a href="https://www.washingtonpost.com/business/the-latest-virus-cases-rise-in-southwestern-chinese-city/2021/04/04/0afb1f40-95b3-11eb-8f0a-3384cf4fb399_story.html">stable employment</a> have become a thing of the past for many people since the pandemic began. Borders shut, planes languished on runways and hotels emptied. Major economies shuddered under strict lockdowns. </p>
<p>But some young people holding <a href="https://www.canada.ca/en/immigration-refugees-citizenship/services/work-canada/iec.html">Canadian working holiday visas</a> were undeterred. They were still allowed to enter — or remain if they were already here. The program allows those under 35 to spend a year or two travelling around Canada, while being able to work as much as they need to get by.</p>
<p>Due to the pandemic, the number of valid working holiday work permits as of late 2020 was <a href="https://open.canada.ca/data/en/dataset/360024f2-17e9-4558-bfc1-3616485d65b9">down by two-thirds</a> compared to the year before. But a portion of these visitors may be thinking of staying permanently — a boon to Canada at a time when immigration numbers have plummeted. </p>
<h2>A once in a lifetime opportunity</h2>
<p>Gabriella De Candia is an Australian who was scheduled to fly from Sydney to Vancouver days after the <a href="https://www.who.int/director-general/speeches/detail/who-director-general-s-opening-remarks-at-the-media-briefing-on-covid-19---11-march-2020">World Health Organization (WHO) declared COVID-19 a global pandemic</a> in March 2020. She tried to change her plans but it was impossible to change or get a refund for her ticket. </p>
<p>The easiest solution, she thought, was to just get on the plane, even though it seemed crazy. “What am I doing? Like, I’m moving overseas in the middle of a pandemic,” De Candia recalls thinking. “Am I going to die?”</p>
<p>The logic and benefits of the Canadian working holiday visa program unravelled as the pandemic took hold. Holidaying in a country paralyzed by COVID-19? Finding a job when <a href="https://www.ctvnews.ca/business/canada-s-jobless-rate-hits-record-high-13-7-per-cent-1.4970589">Canadian unemployment rates</a> had more than doubled? It all seemed impossible.</p>
<p>But the fact remained: a working holiday visa is a once in a lifetime opportunity. And that’s what pushed De Candia to come. </p>
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<img alt="Mount Steven reflects into pond in Field, British Columbia" src="https://images.theconversation.com/files/393865/original/file-20210407-21-19oz14j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/393865/original/file-20210407-21-19oz14j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=290&fit=crop&dpr=1 600w, https://images.theconversation.com/files/393865/original/file-20210407-21-19oz14j.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=290&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/393865/original/file-20210407-21-19oz14j.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=290&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/393865/original/file-20210407-21-19oz14j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=364&fit=crop&dpr=1 754w, https://images.theconversation.com/files/393865/original/file-20210407-21-19oz14j.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=364&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/393865/original/file-20210407-21-19oz14j.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=364&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">British Columbia is a popular spot for many on Canadian working holiday visas because of the stunning scenery, like Mount Steven in Field, B.C.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
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</figure>
<h2>When going home isn’t an option</h2>
<p>For the first couple months after arriving, De Candia was unsure whether to stick it out. During the first lockdown, she crashed in a hostel surrounded by others struggling to get a flight out. It wasn’t how she’d imagined her time in Canada.</p>
<p>“I was spending my own money instead of earning money,” she says. </p>
<p>By the summer, she was feeling better about her decision. She headed to Squamish, B.C., with friends to hike and soak up the outdoors. In the fall, De Candia finally found work in the film industry as she’d hoped.</p>
<p>Flash forward a year, she’s happy with her choice, even though it’s hard not to be jealous of friends and family in Sydney. Their lives are nearly back to normal thanks to Australia’s aggressive tactics to curb the spread of COVID-19, which includes strictly limiting the number of international arrivals to a few thousand per week. </p>
<p>That means De Candia can’t readily go back even if she wanted to. But some Australians don’t want to go home. </p>
<h2>From being stuck, to making home</h2>
<p>In October 2020, Vishal Teckchandani moved to Brownlee, Sask., a small village (<a href="https://www12.statcan.gc.ca/census-recensement/2016/dp-pd/prof/details/page.cfm?Lang=E&Geo1=CSD&Code1=4707048&Geo2=PR&Code2=47&SearchText=Brownlee&SearchType=Begins&SearchPR=01&B1=All&GeoLevel=PR&GeoCode=4707048&TABID=1&type=0">population 55</a>) one hour northwest of Regina. He’d received a visa almost a year before but put off coming. The pandemic tipped the scales. </p>
<p>“I made a conscious decision that life is finite,” Teckchandani says. </p>
<p>By mid-2020, Canada had <a href="https://workingholidayincanada.com/iec-participants-can-come-to-canada/">changed the rules</a> for working holidays and he could only enter if he already had a job lined up. That’s how he ended up in Brownlee; a friend found him a marketing job at a distillery.</p>
<p>Small-town life for Teckchandani has been a revelation. He watches the train rumble through every day. He met his girlfriend. He made friends, and the commute to work is one minute. “In blizzards, I drive 30 seconds and I’m there,” he explains. “Unless I get stuck and I have to shovel the snow.”</p>
<p>Teckchandani loves Canada so much that he’s already decided to stay. He recently began the process of applying for permanent residency. </p>
<h2>From working holiday to permanent residency</h2>
<p>It used to be unusual that someone on a working holiday visa would apply for permanent residency. A <a href="https://www.canada.ca/en/immigration-refugees-citizenship/corporate/reports-statistics/evaluations/international-experience-canada-2019.html">recent evaluation of the program</a> found that only seven per cent of participants from 2013 to 2017 became permanent residents. </p>
<p>Historically, working holidays were reciprocal exchange programs: foreign youth would come to Canada and Canadian youth would go abroad. It was not intended as a path to immigration, notes Naomi Alboim, an expert on Canadian immigration.</p>
<p>Teckchandani is competitive under Canada’s <a href="https://www.loc.gov/law/help/points-based-immigration/canada.php">points-based immigration system</a>, which rewards youth, advanced degrees, fluency in English or French and work experience. The stereotypical image of a working holiday visa holder — an Australian or New Zealander working a couple seasons at Whistler or Big White — is less so, says Alboim.</p>
<p>But after immigration numbers last year fell to their lowest level since 1998, the government announced that it is aiming for <a href="https://www.canada.ca/en/immigration-refugees-citizenship/news/notices/supplementary-immigration-levels-2021-2023.html">401,000 new immigrants</a> in 2021. Given border restrictions, the government is hoping temporary residents, including those on working holidays, will apply. </p>
<p>Not everyone is interested. De Candia is itching to move on and thinks it’s hard for people who freelance in the film industry like her to qualify. “I’m here for two years, and maybe that’s enough,” she says.</p>
<h2>Changes to the program makes choosing Canada easier</h2>
<p>Gemma Taylor, administrator of a <a href="https://www.facebook.com/groups/ocanada.iec.discussion.support/">Facebook group</a> that helps crowdsource solutions to working holiday issues for its 21,000 members, notes that young people who were already inclined to stay may think about permanent residency earlier than they might have otherwise.</p>
<p>It’s a long process, as Jordan Vannier knows. He first came to Canada from France in 2014 and stayed for a year in Calgary, Alta. He found work at The Roasterie, a coffee shop in Kensington, in downtown Calgary. He made friends, learned English and was just starting to feel comfortable when his visa ran out. </p>
<p>Luckily, due to changes to the program, he became eligible for another working holiday and came back in 2017. “It was not for the adventure anymore,” he says. “It was the feeling of there is something for me over there.”</p>
<p>He settled back into Calgary quickly and by summer 2018 he started the paperwork for permanent residency. “Living with a visa that has an end is a weird thing because on a day-to-day basis you feel extremely free,” he explains. “But the thing is that end date is coming closer and closer day by day.”</p>
<p>Knowing he could stay made it easier to do things he wanted. In 2019, Vannier started his own coffee shop with two friends. His application was still pending when the borders closed last year, but he never thought seriously about going back to France.</p>
<p>In February, his permanent residency came through. “Thanks for choosing Canada,” the letter read.</p><img src="https://counter.theconversation.com/content/157648/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Bryony Lau does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The pandemic has led some people on working holiday visas to apply for permanent residency, while others are going to stick out their two years and head home.Bryony Lau, Dalla Lana Fellow, University of TorontoLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1441482020-09-09T12:04:21Z2020-09-09T12:04:21ZThe UK immigration system is broken – coronavirus and Brexit will make it even worse<figure><img src="https://images.theconversation.com/files/357022/original/file-20200908-24-rwf21j.jpg?ixlib=rb-1.1.0&rect=31%2C35%2C2964%2C2209&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A detainee holds a hand against her cell window at Yarl's Wood Detention Centre, Bedford.</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/bedfordshire-uk-08-aug-2015-detainee-351707972">Pete Maclaine/Shutterstock</a></span></figcaption></figure><p><a href="https://www.tandfonline.com/doi/abs/10.1080/01419870.2012.692799">Long waiting times</a> for asylum seekers, the tightening of rules for <a href="https://www.timeshighereducation.com/news/student-visa-rules-tightened-by-government/2014823.article">student visas</a> – and more recently, <a href="https://drive.google.com/file/d/1gYRREyjC1LW9Mk4fReeS848kHbtPK2ao/view">convoluted procedures</a> for EU citizens – are just some of the issues with the UK immigration system. A system that will likely get even worse given the impact of Brexit and the <a href="https://www.gov.uk/government/publications/immigration-statistics-year-ending-june-2020/how-many-people-do-we-grant-asylum-or-protection-to">backlog of cases</a> created by the coronavirus pandemic.</p>
<p>This all comes at a time when the UK immigration system is undergoing significant change. Freedom of movement for EU citizens will come to a stop by the end of 2020 in the UK. And a new <a href="https://theconversation.com/new-points-based-immigration-system-will-lead-to-care-crisis-143299">points-based system</a> is being introduced.</p>
<p>This could lead to more delays, backlogs, refused visa requests and an increase in enforced removals and detention of asylum seekers by immigration officials. As it stands, in 2019, 48% of asylum seekers were <a href="https://migrationobservatory.ox.ac.uk/resources/briefings/deportation-and-voluntary-departure-from-the-uk/">forcibly returned</a> to their home country – with 98% of those made to return kept in detention while in the UK.</p>
<p>And according to The British Educational Research Association, international students are also <a href="https://www.bera.ac.uk/blog/international-students-and-covid-19-what-is-the-current-advice">at risk</a> of removal given their inability to study during lockdown. </p>
<h2>Who gets to stay</h2>
<p>Part of the problem in all of this is that the UK immigration system aims to create a “<a href="https://theconversation.com/hostile-environment-the-uk-governments-draconian-immigration-policy-explained-95460">hostile environment</a>” that makes staying in the UK as difficult as possible for people. Access to work is restricted as is housing, healthcare and bank accounts, with zero attention paid to the integration of asylum seekers. The hope is that people choose to “voluntarily leave”.</p>
<p>The UK also lacks a clear stance on the <a href="https://www.compas.ox.ac.uk/2017/is-voluntary-return-the-new-way-forward-for-managing-irregular-migration/">enforced return</a> of travellers and migrants to their place of origin. The UK has not signed the <a href="https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32008L0115&from=EN">EU Return Directive</a> which provides criteria as to when return migration should occur. And instead, the government has said it will formulate its <a href="https://www.ippr.org/files/images/media/files/publication/2013/02/returning-migrants-EU-130220_10371.pdf">own policy</a> in this area. </p>
<p>The focus of which is likely to remain on <a href="https://www.compas.ox.ac.uk/2017/is-voluntary-return-the-new-way-forward-for-managing-irregular-migration/">controlling immigration</a>, so will likely build upon the present circumstances whereby enforced removal of asylum seekers is used to serve political purposes and <a href="https://www.theguardian.com/commentisfree/2020/aug/24/british-hypocrisy-migrants">reduce immigration numbers</a> – with seemingly little regard for migrants’ circumstances.</p>
<figure class="align-center ">
<img alt="Protest placards outside immigration detention centre." src="https://images.theconversation.com/files/357025/original/file-20200908-20-nwf5no.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/357025/original/file-20200908-20-nwf5no.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/357025/original/file-20200908-20-nwf5no.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/357025/original/file-20200908-20-nwf5no.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/357025/original/file-20200908-20-nwf5no.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/357025/original/file-20200908-20-nwf5no.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/357025/original/file-20200908-20-nwf5no.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Morton Hall immigration detention centre, which has seen high levels of self-harm and violence, is to close and revert to being a prison.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/morton-halllincolnshireuk-january-20th-2018-eighty-1277329099">Ian Francis/Shutterstock</a></span>
</figcaption>
</figure>
<p>Back in 2007, a <a href="https://ec.europa.eu/home-affairs/sites/homeaffairs/files/what-we-do/networks/european_migration_network/reports/docs/emn-studies/return-migration/11._uk_emn_ncp_return_country_study_final_12apr07not_for_publishing_en.pdf">report</a> for the European Migration Network stated that more research needs to be carried out on enforced and voluntary returns within the UK. The report highlighted how, without this, it would be difficult for evidence-based changes to be made. </p>
<p>But research still remains limited and unsystematic. And the Home Office statistics still lack considerable detail – with often only <a href="https://migrationobservatory.ox.ac.uk/resources/briefings/deportation-and-voluntary-departure-from-the-uk/">limited information</a> available as to the reasons for a person’s removal. </p>
<h2>Windrush legacy</h2>
<p>The Windrush scandal is a prime example of this issue. <a href="https://migrationobservatory.ox.ac.uk/commonwealth-migrants-arriving-1971-year-ending-june-2017/">The Migration Observatory</a> estimates that 57,000 migrants who arrived in UK before 1973 were put at risk of deportation, homelessness and unemployment. In some cases people were also refused <a href="https://www.independent.co.uk/news/uk/home-news/windrush-scandal-nhs-cancer-treatment-high-court-legal-challenge-ruling-home-office-a8675781.html">NHS medical treatment</a>.</p>
<p>The Home Office believes that 160 Windrush migrants have been incorrectly detained or deported since 2002. The 2018 government-sponsored <a href="https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/874022/6.5577_HO_Windrush_Lessons_Learned_Review_WEB_v2.pdf">Windrush Lessons Learned Review</a> has since emphasised the need to improve monitoring and evaluating of immigration policy with a focus on equality and human rights. It also suggests measures should tackle the “target-driven” culture within the Home Office, along with a simplification of the system.</p>
<p>A compensation scheme has also been set up. But has proved to be not fit for purpose – with nine in ten Windrush applicants still <a href="https://www.independent.co.uk/news/uk/home-news/windrush-compensation-payout-delay-home-office-a9692251.html">awaiting payment</a>. The scheme has also been <a href="https://www.theguardian.com/uk-news/2020/aug/27/windrush-payout-scheme-not-fit-for-purpose-say-lawyers">criticised</a> for its complicated bureaucratic procedures and the lack of legal aid given to applicants.</p>
<h2>A changing system?</h2>
<p>In a bid to tackle some of these criticisms, the government <a href="https://www.gov.uk/government/news/priti-patel-takes-action-to-implement-windrush-recommendations">has promised</a> mandatory training for all Home Office staff on the history of migration and race in the UK. It’s hoped that this, along with a higher proportion of BAME employees in senior roles, will offer a more compassionate “people not cases” approach. </p>
<figure class="align-center ">
<img alt="Protestors outside immigration detention centre." src="https://images.theconversation.com/files/357029/original/file-20200908-16-6d17th.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/357029/original/file-20200908-16-6d17th.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/357029/original/file-20200908-16-6d17th.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/357029/original/file-20200908-16-6d17th.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/357029/original/file-20200908-16-6d17th.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/357029/original/file-20200908-16-6d17th.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/357029/original/file-20200908-16-6d17th.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Around a third of immigration detainees are held for longer than 28 days.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/morton-halllincolnshireuk-january-20th-2018-eighty-1277329126">Ian Francis/Shutterstock</a></span>
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</figure>
<p>The government has also committed to opening up the Home Office to greater scrutiny and to impact assessments on the potential implications of policies. But this all contrasts sharply with Brexit and the UK goverenment’s overall aggressive approach towards immigration. </p>
<p>Just look at the way the <a href="https://blogs.lse.ac.uk/brexit/2020/05/06/there-are-cracks-in-the-eu-settlement-scheme-who-will-fall-through-them/">EU Settlement Scheme</a> – for EU citizens who want to remain in the UK – has been rolled out. Along with the <a href="https://drive.google.com/file/d/1gYRREyjC1LW9Mk4fReeS848kHbtPK2ao/view">significant impact</a> it has had upon people’s mental health, wellbeing and sense of belonging in Britain. And problems accessing the scheme have only got worse as a result of COVID-19. </p>
<p>The UK parliament has reacted strongly against the conservative government’s approach to this settlement scheme, fearing discrimination of EU citizens and another “<a href="https://www.theguardian.com/politics/2020/jan/07/eu-parks-post-brexit-demands-avoid-early-clash-boris-johnson-ursula-von-der-leyen">Windrush catastrophe</a>”. </p>
<p>Ultimately though a system that seems to disregard <a href="https://www.equalityhumanrights.com/sites/default/files/is-england-fairer-2016-most-disadvantaged-groups-migrants-refugees-asylum-seekers.pdf">fundamental human rights</a> in the way it <a href="https://www.ippr.org/files/2020-09/access-denied-hostile-environment-sept20.pdf">regulates and processes people</a> is bound to continue creating vulnerability for migrants. And no doubt the impact of Brexit and the pandemic will only make this worse.</p><img src="https://counter.theconversation.com/content/144148/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Zana Vathi receives funding from IMISCOE as part of the Research Initiative 'Revisiting Return Migration in Shifting Geopolitics'.</span></em></p><p class="fine-print"><em><span>Samantha Carney does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>This is a system that will likely become even worse given the impact of Brexit and the backlog of cases created by the pandemic.Zana Vathi, Reader in Social Sciences, Edge Hill UniversitySamantha Carney, PhD Candidate and Graduate Teaching Assistant in Social Sciences, Edge Hill UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1362142020-04-16T12:18:57Z2020-04-16T12:18:57ZLeading in wartime: 5 ways CEOs should communicate with their workers during coronavirus<figure><img src="https://images.theconversation.com/files/328105/original/file-20200415-153326-vsp2k3.jpg?ixlib=rb-1.1.0&rect=309%2C316%2C4492%2C2843&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Microsoft's Satya Nadella urged his employees to show empathy for one another.</span> <span class="attribution"><span class="source">AP Photo/Elaine Thompson</span></span></figcaption></figure><p><a href="https://abcnews.go.com/Politics/trump-coronavirus-task-force-economic-public-health-steps/story?id=69646672">President Donald Trump</a> and <a href="https://www.cnbc.com/2020/04/06/chief-surgeon-at-top-ny-hospital-likens-this-week-of-coronavirus-outbreak-to-war.html">others</a> have likened the coronavirus pandemic to fighting a war. </p>
<p>As <a href="https://scholar.google.com/citations?user=697eQncAAAAJ&hl=en&oi=ao">someone who studies how leaders communicate</a>, I believe that’s an apt description. But the president isn’t the only general in this battle. America’s CEOs also have important leadership roles to play as the crisis poses a test of their ability to help their workers not only endure and stay healthy but keep them motivated and engaged as well. </p>
<p>What’s the best way to do that? </p>
<p>To find an answer, I reviewed <a href="https://www.dropbox.com/home/Temporary/CEO%20Communication%20Literature">21 academic studies</a>
on executive leadership communication and conducted a textual analysis of <a href="https://instituteforpr.org/covid-19-resources-for-pr-professionals/">12 industry studies</a> related to <a href="https://www.ickollectif.com/covid-19">organizational and leadership communication</a> during the pandemic.</p>
<p>I discovered five key themes that may provide some insights for how CEOs should communicate with their employees during the COVID-19 pandemic.</p>
<h2>1. Be transparent</h2>
<p><a href="https://doi.org/10.1016/j.pubrev.2019.04.012">Transparency</a> requires leaders to openly and proactively share relevant information to employees in a timely, frequent and digestible manner; give accurate information regarding what is happening, what the impact is and how the company is handling it; and offer clear guidance on what workers should be doing. </p>
<p>It also means encouraging employees to speak up and share their feedback and concerns. This kind of openness <a href="https://doi.org/10.1016/j.pubrev.2019.04.012">fosters trust</a>and reduces uncertainty – especially important in a <a href="https://www.doi.org/10.1080/1062726X.2013.795869">crisis</a>. </p>
<p>In a video message to the employees, <a href="https://www.inc.com/jason-aten/marriotts-ceo-shared-a-video-with-his-team-its-a-powerful-lesson-in-leading-during-a-crisis.html">Marriott CEO Arne Sorenson</a> demonstrated this when he didn’t try to sugarcoat the losses his company has suffered in the crisis.</p>
<h2>2. Convey authenticity</h2>
<p>Authentic leadership is not a new concept to the business community and its effectiveness in generating positive employee outcomes has been supported by a bulk of <a href="https://www.doi.org/10.1177/0093650215613137">academic</a> and industry <a href="https://www.doi.org/10.1080/1062726X.2014.908720">research</a>. </p>
<p>While CEOs are wired to take action, tough times like the pandemic cast monumental challenges to leading an organization. In an era where uncertainties outweigh the certainties, sometimes they simply don’t know what to do. </p>
<p>That’s okay. CEOs that authentically share vulnerability can actually demonstrate the human side of leadership. Employees look up to leaders for assurance and support. They do not necessarily expect CEOs to be superheroes. </p>
<p>To communicate in an authentic manner, CEOs should stay true to their values and beliefs and keep their promises. They need to also be self-aware of what they’re capable of, and genuine in their communication with employees – even when they don’t know what’s going on. </p>
<p>Jeff Bezos, CEO of Amazon, <a href="https://blog.aboutamazon.com/company-news/a-message-from-our-ceo-and-founder">exhibited this trait</a> when he acknowledged to employees, “There is no instruction manual for how to feel at a time like this,” and added his own list of worries, such as the safety of his family and colleagues. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/328441/original/file-20200416-192749-1ldy9r4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/328441/original/file-20200416-192749-1ldy9r4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/328441/original/file-20200416-192749-1ldy9r4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/328441/original/file-20200416-192749-1ldy9r4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/328441/original/file-20200416-192749-1ldy9r4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/328441/original/file-20200416-192749-1ldy9r4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/328441/original/file-20200416-192749-1ldy9r4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Amazon CEO Jeff Bezos conveyed authenticity in his letter to employees.</span>
</figcaption>
</figure>
<h2>3. Show empathy</h2>
<p>The value of empathy was perhaps the most recurring theme in my analysis of best practices.</p>
<p>In my own <a href="https://doi.org/10.1016/j.pubrev.2019.04.012">recent study</a> that examined leadership communication during a planned organizational change – such as a merger – I found that communicating with empathy enhanced employee trust and drove commitment and acceptance to that change. </p>
<p>The COVID-19 pandemic poses similar challenges because employees face enormous uncertainties and unpleasant emotions, such as fear, sadness, anxiety and frustration. CEOs can help reduce worker anxiety and form a bond with them by <a href="https://www.doi.org/10.1108/01437730610692425/full/html">showing sympathy</a> and standing in their shoes. </p>
<p><a href="https://www.linkedin.com/pulse/coming-together-combat-covid-19-satya-nadella/">Microsoft CEO Satya Nadella</a> demonstrated this and emphasized the value of empathy in his message to employees, urging them to show “understanding for each other’s situations.”</p>
<h2>4. Put people first</h2>
<p>The novel coronavirus is <a href="https://www.nytimes.com/2020/04/14/business/economy/coronavirus-corporate-earnings-stocks.html">hammering companies’ bottom lines</a>, from productivity to profits. CEOs that put employees’ safety and health first are demonstrating their humanity. </p>
<p>This people-centered mindset is crucial for the organization’s survival and long-term development as employees are the backbone of the organization and eventually create the organization’s <a href="http://connection.ebscohost.com/c/articles/15905241/breakthrough-organization-performance-competitive-advantage-through-employee-centered-management">competitive advantage</a>.</p>
<p>We have seen many examples of this during the current crisis, such as the CEOs of Bank of America, Citigroup, FedEx and Visa <a href="https://www.forbes.com/sites/jackkelly/2020/03/27/prominent-ceos-promise-that-they-will-not-layoff-workers-in-2020/#f613cd9a61d5">pledging not to lay off any workers</a> as a result of the pandemic.</p>
<h2>5. Demonstrate optimism</h2>
<p>Conveying positivity or optimism is an especially important leadership quality during challenging times, when it is easy for people to experience negative feelings and frustrations. Leaders who portray an optimistic outlook in the tone of their communications and foster positive thinking motivate and inspire employees. </p>
<p>A good example of this is Levi Strauss CEO Chip Bergh, who <a href="https://sourcingjournal.com/denim/denim-business/levi-chip-bergh-coronavirus-heritage-denim-employees-201735/">wrote a letter to employees</a> encouraging them to focus on the crisis’ silver lining. </p>
<p>“One of the things motivating me through this difficult time is the idea that we can learn and adapt and adjust so we emerge stronger as a result of this test,” he wrote. The crisis “will pass. We will get through this together and be a better and stronger company as a result of it.”</p>
<p>And at my own school, University of Florida <a href="https://gatorswire.usatoday.com/2020/03/11/university-of-florida-president-kent-fuchs-issues-statement-on-covid-19/">President Kent Fuchs</a> reminded students and staff of their “tradition of pulling together and rising to meet major challenges with optimism and determination.”</p>
<p>During extraordinary times like the COVID-19 pandemic, leaders need effective communication skills like these to instill trust, confidence and hope in their workers – essential ingredients to winning the war. </p>
<p>[<em>You need to understand the coronavirus pandemic, and we can help.</em> <a href="https://theconversation.com/us/newsletters?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=upper-coronavirus-help">Read The Conversation’s newsletter</a>.]</p><img src="https://counter.theconversation.com/content/136214/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Rita Men does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A scholar of how leaders communicate offers five key traits CEOs should use when communicating with their workers about coronavirus.Rita Men, Associate Professor of Public Relations, University of FloridaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1231542019-09-19T22:13:56Z2019-09-19T22:13:56ZBuyer beware: How Libra differs from Bitcoin<figure><img src="https://images.theconversation.com/files/292702/original/file-20190916-19076-1tlq1vo.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C4215%2C2371&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Recent revelations about the lack of privacy protections in place at the companies involved in Facebook's new Libra crytocurrency raise concerns about how much trust users can place in Libra.</span> <span class="attribution"><span class="source">(Shutterstock)</span></span></figcaption></figure><p>Facebook, the largest social network in the world, stunned the world earlier this year with <a href="https://techcrunch.com/2019/06/18/facebook-libra/">the announcement of its own cryptocurrency, Libra</a>. </p>
<p>The launch has raised questions about the difference between Libra and existing cryptocurrencies, as well as the implications of private companies competing with sovereign countries in issuing currencies.</p>
<p>Unlike <a href="https://bitcoin.org/en/">Bitcoin</a>, which has neither an owner nor a controlling body, Libra will be governed by a Swiss foundation comprised of several members that are well-established brands, including Uber, Visa and PayPal.</p>
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Read more:
<a href="https://theconversation.com/facebooks-libra-its-not-the-crypto-thats-the-issue-its-the-organisation-behind-it-121223">Facebook’s Libra: it’s not the ‘crypto’ that’s the issue, it's the organisation behind it</a>
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<p>Libra operates within a much more controlled environment relative to many other cryptos like Bitcoin <a href="https://www.ethereum.org/">and Ether</a>. It also doesn’t <a href="https://theconversation.com/transparency-and-privacy-empowering-people-through-blockchain-104887">run on a blockchain.</a></p>
<p>Instead, the book-keeping of Libra transactions is bestowed upon a set of trusted computing nodes controlled by the members of the Libra foundation. In contrast, Bitcoin is a free-for-all where anybody can join the group of computers that verify transactions. </p>
<p>This difference in governance structure has wide-ranging implications for the economic gains and possible risks society faces from a possible widespread adoption of new currencies like Libra. </p>
<h2>How to grow?</h2>
<p>A fundamental issue most fintech companies face today is scaleability. The Visa network can authorize up to <a href="https://www.visa.ca/en_CA/about-visa/visanet.html">65,000 transactions per second</a>, while Bitcoin typically processes a few hundred thousand a day. </p>
<p>Technically, it’s possible to expand the Bitcoin network to a commercially viable scale, but due to the lack of a governing body, several attempts to increase capacity have ended up in endless debates, fights within the community and different camps going their own ways. It’s resulted in the creation of offspring currencies such as <a href="https://bitcoingold.org/">BitcoinGold</a> and <a href="https://www.bitcoincash.org/">BitcoinCash</a>.</p>
<p>Libra overcomes these struggles by a well-defined governance structure where necessary technical adaptations can be efficiently decided upon in an organized manner.</p>
<p>But Libra decision-makers may be tempted to put their own best interests ahead of the consumers’ benefit. Recent revelations about the lack of privacy protections in place at the companies on Libra’s foundation raise concerns about how much trust users can place in Libra when they’re deciding whether to open up their financial transactions to the big internet companies on Libra’s board. </p>
<p>Intimate knowledge of people’s purchases, wealth and shopping behaviour has incredible value for advertising and resale to other companies. It will be up to the consortium members to credibly convince the public that they will refrain from monetizing this huge wealth of data that they sit upon.</p>
<h2>Guard against fraud</h2>
<p>In our traditional financial system, laws and regulators watch over privacy as well as access to the financial system. Laws not only provide privacy protections, they also guard against fraud and ensure that citizens can participate on a level playing field.</p>
<p>Rules are created in a democratic process. Banks in western countries cannot easily ban citizens from basic financial services, which are important to join the workforce and get established in society. </p>
<p>But currencies issued by private companies do not face the same scrutiny. What if Facebook decides you cannot have Libra because you posted a critical article on the internet? Your legal options would be limited. </p>
<p>Bitcoin’s chaotic governance structure has an advantage here. Without a governing body, there is nobody who can lock anybody else out of the system. While this approach ensures equal access, however, it also invites criminals to use Bitcoin for illicit purposes. </p>
<figure class="align-left ">
<img alt="" src="https://images.theconversation.com/files/292705/original/file-20190916-19072-asmlcy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/292705/original/file-20190916-19072-asmlcy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=810&fit=crop&dpr=1 600w, https://images.theconversation.com/files/292705/original/file-20190916-19072-asmlcy.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=810&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/292705/original/file-20190916-19072-asmlcy.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=810&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/292705/original/file-20190916-19072-asmlcy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1018&fit=crop&dpr=1 754w, https://images.theconversation.com/files/292705/original/file-20190916-19072-asmlcy.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1018&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/292705/original/file-20190916-19072-asmlcy.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1018&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">A portrait of Marco Polo, circa 1600, from the Gallery of Monsignor Badia in Rome.</span>
<span class="attribution"><span class="source">Creative Commons</span></span>
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</figure>
<p>Centuries ago, promissory notes <a href="https://www.thoughtco.com/the-invention-of-paper-money-195167">emerged in China</a> and were brought to Europe by Marco Polo as an early banking service that allowed merchants to travel without large sums of money due to fear they’d be robbed. Banks offered safekeeping for money, allowing the merchant to store the funds and withdraw them whenever and wherever needed. </p>
<p>Today, banks still spend billions of dollars on security to protect their clients’ savings. Many credit-card companies provide protection against fraudulent transactions.</p>
<p>No such protections exist for cryptocurrencies. No recourse is possible should a hacker gain access to your wallet or if your crypto becomes worthless. With cryptocurrencies, users must once again worry about safekeeping.</p>
<h2>Deposit insurance</h2>
<p>Often under-appreciated, but of great importance, is government-provided <a href="https://www.cdic.ca/">deposit insurance</a> that provides a second layer of security, protecting depositors against the default of the bank. </p>
<p>Unlike Bitcoin, where prices fluctuate dramatically within a few days, Libra’s value is tied to a basket of international currencies. As users buy Libra with fiat currency, including Canadian dollars, the Libra foundation will take these dollars and invest them in safe securities. </p>
<p>Because Libra is backed with real and stable financial assets, the value of Libra will then also be stable. While this approach sounds great at a first glance, several problems exist that have plagued banking for centuries. </p>
<p>Temptations will arise to invest some of the money in riskier securities for a higher return. What if people, for some reason or another, doubt that the assets are there or think that the assets lost value? Long lines of depositors wanting to withdraw their funds from a bank that they rightfully or wrongfully believe to be troubled have been observed ever since the inception of banks.</p>
<p>Such bank runs are often self-fulfilling, and Libra is not immune to this problem. When users want to cash out, Libra would have to sell their assets at a large scale, causing the price of these very assets to fall and hence end up with insufficient funds to pay all investors. </p>
<p>As users realize what is happening, more will want to cash out, speeding up the vicious circle. </p>
<h2>Would any government come to the rescue?</h2>
<p>Unlike with banks, it’s unclear how possible losses will be covered and how they might be shared among users. Some U.S. money market funds that are in a similar business — investing client’s money in safe short-term assets — found themselves in similar trouble in the <a href="https://www.nytimes.com/2011/04/03/business/03gret.html">2008 financial crisis</a> and were bailed out by the government. </p>
<p>With Libra, it’s unclear which government would come to the rescue, if any.</p>
<p>All the money that users will put into Libra will be missed in the traditional banking system, where banks can put deposits to good use by providing loans to productive companies that generate value and employment. The economic consequences therefore could be far-reaching.</p>
<p>The foundation for Libra’s model and possible success is the banking sector’s shortcomings and inefficiencies.</p>
<p>While Libra might not offer many advantages to users in Western countries, it will open access to financial services for millions of people around the world without bank accounts. </p>
<p>Cross-border payments are in the current system ridiculously expensive and slow. Traditional banking often seems bureaucratic and technologically outdated. All these issues could be fixed by banks, but it will take outside pressure of new fintech startups to get it done.</p>
<p>[ <em>Deep knowledge, daily.</em> <a href="https://theconversation.com/ca/newsletters?utm_source=TCCA&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=deepknowledge">Sign up for The Conversation’s newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/123154/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Alfred Lehar receives funding from SSHRC and the Canadian Securities Institute Research Foundation.</span></em></p>Recent revelations about the lack of privacy protections in place at the companies on Libra’s foundation raise concerns about how much trust users can place in Facebook’s new cryptocurrency.Alfred Lehar, Associate Professor, University of CalgaryLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1212232019-08-06T13:44:38Z2019-08-06T13:44:38ZFacebook’s Libra: it’s not the ‘crypto’ that’s the issue, it’s the organisation behind it<figure><img src="https://images.theconversation.com/files/286737/original/file-20190802-117871-qda2ij.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The founding partners of the Libra Association.</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/stone-staffordshire-united-kingdom-july-4-1442223218?src=cvqScd5qlPnYCUJF0e2XRA-1-2&studio=1">Ascannio / Shutterstock.com</a></span></figcaption></figure><p>In all the hype that has surrounded its Libra currency, Facebook has been able to distract attention away from an important issue. Libra is being hyped as Facebook’s bitcoin but it’s really a proposal for a global payments system. And that system will be controlled by a small and exclusive club of private firms.</p>
<p>Since it was announced in June, politicians and regulators have attacked Libra, citing <a href="https://www.bbc.co.uk/news/technology-49092713">concerns about its being a cryptocurrency</a>. Libra is not a cryptocurrency – at least, not as they have been put into practice so far, where a distributed, decentralised community participates in transaction verification <a href="https://theconversation.com/how-are-bitcoin-cryptowallets-and-blockchain-related-some-jargon-busted-88906">via a competitive process</a>. </p>
<p>Libra is essentially a prepaid digital token, backed one-to-one with a basket of reserve currencies. It is “minted” when people put up state-issued currencies to buy it.</p>
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<strong>
Read more:
<a href="https://theconversation.com/facebooks-libra-has-staggering-potential-state-control-of-money-could-end-119434">Facebook's libra has staggering potential – state control of money could end</a>
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<p>What’s important here is not the technological innovation. Facebook is proposing, in Libra, a new form of organisation. We already have payment systems controlled by private companies – Visa, MasterCard, Venmo or PayPal, which provide the infrastructure or “rails” for transferring value – and Libra might turn into another such rail. But its promoters have <a href="https://libra.org/en-US/vision/">greater ambitions for it</a>. </p>
<p>Based on our research on the <a href="https://mitpress.mit.edu/books/paid">history and technology of payment infrastructures</a>, we see similarities between Libra and Visa. But it’s the differences with the Visa network that raise the biggest warning flags.</p>
<h2>Learning from Visa</h2>
<p>Libra will be controlled and maintained by the <a href="https://libra.org/en-US/association-council-principles/#overview">Libra Association</a>, a membership-based group. Libra’s developers have voiced a commitment to letting anyone become a member of the association, including users like you and me. The <a href="https://libra.org/en-US/permissionless-blockchain/#overview">Libra white paper</a> trumpets the importance of decentralisation. But it also admits that, “as of today we do not believe that there is a proven solution that can deliver the scale, stability, and security needed to support billions of people and transactions across the globe” through a truly open, decentralised system.</p>
<p>We believe Libra’s founders got the idea from <a href="https://www.springer.com/gp/book/9781849961387">the work of Visa’s founder, Dee Hock</a>. Hock was heralded as a visionary in his day, like Steve Jobs or Mark Zuckerberg today. He realised that the problem facing payments between banks was not technological, but organisational. </p>
<p>When setting up Visa, it was important for Hock that Visa would not be owned by self-interested shareholders. Instead, it was the users, banks and credit unions, who “owned” Visa as a cooperative membership organisation. Ownership here did not entail the right to sell shares, but an irrevocable right of participation – to jointly decide on the rules of the game and Visa’s future. </p>
<p>The incentive was to create a malleable but durable payment infrastructure from which all members would benefit in the long term. To work, everyone had to give something up – including their own branding on credit cards, subordinating their marks to Visa. This was a really big deal. But Hock convinced the network’s initial members that the payoff would come from the new market in payment services they would create. He was right.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/286738/original/file-20190802-117857-r65akp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/286738/original/file-20190802-117857-r65akp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=401&fit=crop&dpr=1 600w, https://images.theconversation.com/files/286738/original/file-20190802-117857-r65akp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=401&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/286738/original/file-20190802-117857-r65akp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=401&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/286738/original/file-20190802-117857-r65akp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/286738/original/file-20190802-117857-r65akp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/286738/original/file-20190802-117857-r65akp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Different banks, same Visa network.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/suphanburi-thailand-22-may-2017-pile-649842400?src=hztSEF-SZrccNZY_49xRmw-1-5&studio=1">Tony Stock / Shutterstock.com</a></span>
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<p>For most of its existence, until it went public in 2016, Visa was an anomalous creature: a for-profit, non-stock corporation based on the principle of self-organisation, embodying both chaos and order. Hock even coined a term for it: <a href="https://archive.org/details/birthofchaordica00hock_0">“chaordic”</a>.</p>
<p>Libra envisions a similar collaborative organisation among the founding members of its Libra Association. But it turns Hock’s principles upside down. The Libra Association is all about ownership and control by its members as a club.</p>
<h2>Big barriers to entry</h2>
<p>And the Libra Association is a club with very high barriers to entry. An entity has to invest at least US$10m in Libra or have more than US$1 billion in market value, among other criteria. The initial <a href="https://libra.org/en-US/association/#founding_members">list of founding members</a> tilts toward groups that have shown strong opposition to government interference and oversight. Tellingly, there are no regulated financial entities – like banks and fund managers – in the mix. The membership represents a self-selecting crème de la crème of global tech and <a href="https://www.investopedia.com/terms/v/vulturecapitalist.asp">vulture capitalism</a>.</p>
<p>Association membership guarantees a share of future profits proportionate to a member’s stake in the system. Unlike Visa, members do not compete with one another for market share. Instead, they will passively collect rent from interest made on investing in the Libra reserve basket. Plus, profits are not shared with users, and no interest is paid on the balance held by individuals. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/libra-four-reasons-to-be-extremely-cautious-about-facebooks-new-currency-119123">Libra: four reasons to be extremely cautious about Facebook's new currency</a>
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<p>Being a club member also affords the right to vote – again, a lot like Visa. But, unlike Visa, Libra gives voting right power based on investment level, not participation. This is not democratic; it is a plutocracy, where the wealthiest rule. And, as profits are linked solely to interest on the association’s reserve funds, those managing it may well become riskier and more speculative over time.</p>
<p>Libra’s white paper outlines an organisation that could become a decentralised, participatory system like Hock envisioned Visa would become. But Libra, if it is successful, will likely become an undemocratic behemoth. Alarm bells ring about a global currency’s de facto governance by a private, exclusive club serving the purposes of its investor-owners, not the public good. </p>
<p>Governments have long been suspicious of private currencies for good reasons, and Libra is no exception. We must not be distracted by its proposed technical complexity, and instead, focus on how this technology is organised, put to work, and how its rewards are distributed. The good news is that Facebook’s play for money may at last prompt politicians to regulate tech giants to curb their impact on and influence over society.</p><img src="https://counter.theconversation.com/content/121223/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Bill Maurer receives funding from the US National Science Foundation and the Filene Research Institute.</span></em></p><p class="fine-print"><em><span>Daniel Tischer does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Alarm bells should ring over a global currency that is run by an exclusive club that serves its investor-owners, not the public good.Bill Maurer, Professor of Anthropology and Law, University of California, IrvineDaniel Tischer, Lecturer in Management, University of BristolLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1032282018-09-16T20:11:35Z2018-09-16T20:11:35ZWhy yet another visa for farm work makes no sense<figure><img src="https://images.theconversation.com/files/236508/original/file-20180916-177935-1o3unhd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Do we need yet another class of guest workers to pick our fruit?</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/">Shutterstock</a></span></figcaption></figure><p>Rumours have circulated for months that the National Party and National Farmers Federation are pushing for a new so-called agricultural visa for temporary migrants. Now
<a href="http://www.abc.net.au/radionational/programs/breakfast/new-visa-for-foreign-farm-workers/10240522">they have gained momentum</a>, and reports indicate an announcement early next week.</p>
<p>Details are scarce, but it seems the visa will differ from the two existing visas for agricultural workers from the Pacific – the Seasonal Worker Program (SWP) and the Pacific Labour Scheme (PLS) – in being more flexible and also <a href="https://www.countrynews.com.au/@horticulture/2018/05/08/107702/minister-supports-new-visa">open to workers from across Asia</a>.</p>
<p>The SWP allows workers to come to Australia from the Pacific or Timor Leste for up to six months to pick fruit and vegetables. It is growing rapidly: by <a href="http://www.devpolicy.org/another-bumper-year-for-the-seasonal-worker-programme-20180731/">almost 40% per year</a>. </p>
<p>The newer PLS allows Pacific Island workers to come to regional Australia to work in any sector for up to three years. Only a year old, it too could grow rapidly. </p>
<h2>No longer solely Pacific</h2>
<p>Here are the three reasons why an additional extra agricultural visa is not just a bad idea, but one that makes no
sense.</p>
<p>First, we don’t need one. Farmers can already hire SWP workers to meet their short-term needs (up to six
months) and PLS workers for their long-term needs (up to three years). If there are problems with these schemes, the best approach would be to fix them.</p>
<p>Second, a new agricultural visa would reduce our leverage in the Pacific relative to China’s. </p>
<p>The one thing we can offer Pacific nations that China can’t is labour mobility. <a href="http://www.devpolicy.org/is-a-new-visa-for-agricultural-work-needed-20180913/">More than 10%</a> of Tongans aged 20–45 travel to Australia or New Zealand each year for seasonal work. </p>
<p>If they were partly or largely replaced by workers from countries such as Indonesia and Vietnam, it would greatly antagonize our Pacific island neighbours, shred our credibility in the Pacific, and it would drive Pacific countries towards China.</p>
<h2>Less closely regulated</h2>
<p>Third, the new class of visa is being touted about as more flexible. </p>
<p>There’s a risk that might mean fewer safeguards, and easier worker exploitation. The SWP is a well regulated, and has far fewer compliance problems than the unregulated backpacker scheme. </p>
<p>In practice, it probably won’t have a weaker set of standards to the two existing Pacific schemes, because to do so would be to treat workers from different countries differently, meaning the flexibility promised won’t be delivered.</p>
<p>If
the National Party was serious about improving the access of Australian farmers to workers from overseas, it would be demanding reforms to the existing SWP and PLS. Those reforms could make the conditions more employer-friendly or add more countries to the list.</p>
<p>Those proposals could be publicly debated. </p>
<p>Creating a new extra agricultural visa makes no sense. It would not help farmers, and, from a strategic perspective would be a serious own goal.</p><img src="https://counter.theconversation.com/content/103228/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Stephen Howes receives funding from the Department of Foreign Affairs and Trade as part of the Pacific Research Program.</span></em></p>Introducing yet another special agricultural employment visa might destroy the good things about the ones we’ve got.Stephen Howes, Director, Development Policy Centre, Crawford School of Public Policy, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1004092018-07-30T13:54:17Z2018-07-30T13:54:17ZThe free movement of people is an AU ambition: what’s standing in its way<figure><img src="https://images.theconversation.com/files/229596/original/file-20180727-106521-1h2khxq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">People from the DRC flee the fighting. Movement of people is restricted across the continent.</span> <span class="attribution"><span class="source">EPA/DAI KUROKAWA</span></span></figcaption></figure><p>The African integration project took several major steps this year. One of them was the African Union’s <a href="http://www.sabcnews.com/sabcnews/au-adopts-new-protocol-on-free-movement-of-people-across-africa/">adoption</a> of a protocol on the free movement of people. The move has been widely welcomed. </p>
<p>The free movement of Africans between African countries could unquestionably <a href="https://theconversation.com/how-the-free-movement-of-people-could-benefit-africa-92057">facilitate growth</a>. Allowing freer movement would encourage trade, tourism and investment between African countries. And it would allow students to study in other African countries and Africans with suitable skills to find rewarding jobs. </p>
<p>Opening up borders has been shown to have positive affects in other parts of the world. For example, growth of many Asian countries is significantly attributable to the liberalising of inter-Asian relationships including through <a href="https://www.taylorvinters.com/article/new-asean-economic-community-introducing-employee-cross-border-mobility-asia/">an agreement between Southeast Asian countries</a> that promotes freer mobility for workers. </p>
<p>Some African countries have recognised the benefits of ensuring free movement of people. <a href="https://issafrica.org/pscreport/on-the-agenda/the-long-road-to-opening-africas-borders">Seychelles, Mauritius and Rwanda</a> have liberalised their visa requirements. One effect is that there’s been a significant rise in inward tourist arrivals from other African countries. And the removal of visa and even passport requirements within regional trading blocs in both East and West Africa are widely believed to have led to increased economic activity.</p>
<p>But there are major obstacles that need to be cleared before the ambition of free movement across the continent can be achieved. The biggest is posed by concerns raised by the continent’s major economies like <a href="https://www.google.co.za/search?q=SOUTH+AFRICAN+POSITION+ON+THE+IMPLEMENTATION+OF+THE+AFRICAN+UNION+(AU)+AGENDA+2063+AS+IT+RELATES+TO+MIGRATION%2C+REGIONAL+INTEGRATION+AND+AFRICA+PASSPORT&rlz=1C1CHWA_enZA699ZA699&oq=SOUTH+AFRICAN+POSITION+ON+THE+IMPLEMENTATION+OF+THE+AFRICAN+UNION+(AU)+AGENDA+2063+AS+IT+RELATES+TO+MIGRATION%2C+REGIONAL+INTEGRATION+AND+AFRICA+PASSPORT&aqs=chrome..69i57.766j0j7&sourceid=chrome&ie=UTF-8">South Africa</a> and countries in <a href="https://www.libyaobserver.ly/news/libya-rejects-au-free-movement-protocol">North Africa</a> where unemployment rates are high and there are fears that increased immigration could contribute to increasing domestic tensions. </p>
<p>There are also concerns that if not well managed the free movement could worsen brain drain for poorer countries. Because of these concerns, among others, only 30 countries have <a href="https://allafrica.com/view/group/main/main/id/00059720.html">signed</a> the protocol. This is much lower than the 44 that have signed the <a href="https://au.int/en/pressreleases/20180321/list-african-countries-signed-establishment-african-continental-free-trade">African Continental Free Trade Agreement</a>. </p>
<h2>The obstacles</h2>
<p>The AU recognises the lack of readiness of many domestic and continental arrangements that would allow the immediate full implementation of the protocol. Some countries have population registration and passport systems which lack integrity, some have weak border management, and some have poor security intelligence.</p>
<p>Because of this, implementation has been divided into three phases: right of entry and abolition of visa requirements; right of residence; and right of establishment (which includes investment and setting up a business). </p>
<p>Phases 2 and 3 will not be implemented until the implementation of the first phase has been reviewed.</p>
<p>But many countries, especially the richer ones, are reluctant even to enter phase one without some conditions being met. </p>
<p>The key concerns are around the absence of inter-state cooperation measures on immigration procedures, border management, education systems and mutual recognition of qualifications, common standards for working conditions, and access to or portability of social security benefits.</p>
<p>South Africa, in particular, has issues with a range of the requirements. A memo of the South African Department of Home Affairs identifies 12 preconditions for the implementation of the protocol. Some of them are unrealistically idealistic such as the condition of “peace, security and stability on the continent”.</p>
<p>But about half of the preconditions seem quite reasonable and understandable. They include civil registration systems and bilateral return agreements. Civil registration systems critical; South Africa is one of the few countries on the continent that has a comprehensive ID system.</p>
<p>Home Affairs <a href="http://www.dha.gov.za/WhitePaperonInternationalMigration-20170602.pdf">position</a> is very cautious. It advises against even adopting Phase 1 of the protocol – the right of entry and abolition of visas for fellow Africans – until certain conditions are met. It is imperative, it argues, to improve population registration systems, establish integrated border management systems, enter into bilateral return agreements and strengthen law enforcement at national level across Africa before Phase 1 is supported.</p>
<p>South Africa, they argue, is not alone in adopting this stance. Other countries with similar concerns include many of the North African countries and one or two other richer African countries. Like South Africa, most North African countries have relatively high unemployment rates and fear a backlash from citizens. In situations of unemployment and inequality, disadvantaged citizens can end up blaming ‘foreigners’ for their predicament, resulting in tensions than can lead to <a href="https://probonomatters.co.za/2018/02/nigerian-media-says-its-still-war-against-nigerians-in-south-africa/">xenophobia</a>.</p>
<p>It’s unlikely that the Protocol will make progress unless fears are addressed.
So, how can the AU get the laggards on board? </p>
<h2>Next steps</h2>
<p>One suggestion is that the AU sets up a technical committee to address the issues raised and to come up with proposed solutions.</p>
<p>A stronger African coordination around population registration, leading ultimately to an African ID or an African standard ID would be a neat way to address these technical issues. The technical committee could focus first on the obstacles to implementing Phase 1. Once that hurdle is crossed it could move on to Phase 2, and eventually to Phase 3.</p>
<p>The technical committee must be well-resourced with officials and experts, both to achieve its objectives and to ensure that the richer countries believe the committee will make progress with or without them. They will not want to be left out.</p>
<p><em>This article is based on a talk given by the author at the <a href="http://www.ipss-addis.org/news/news_and_events/post-tana_forum_-_african_leaders_should_practice_.php">Post-Tana Forum</a> in Gaborone.</em></p><img src="https://counter.theconversation.com/content/100409/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Alan Hirsch does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The free movement of people between African countries could facilitate economic development.Alan Hirsch, Professor and Director of The Nelson Mandela School of Public Governance, University of Cape TownLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/892792017-12-19T01:39:48Z2017-12-19T01:39:48ZWhy Trump’s plan to forbid spouses of H-1B visa holders to work is a bad idea<figure><img src="https://images.theconversation.com/files/199824/original/file-20171219-27595-v5b083.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">U.S. immigration law has a complicated history with keeping families together. </span> <span class="attribution"><span class="source">Reuters/Brian Snyder</span></span></figcaption></figure><p>On Dec. 14, the Trump administration announced a <a href="https://www.reginfo.gov/public/do/eAgendaViewRule?pubId=201710&RIN=1615-AC15.">regulatory change</a> that would strip spouses of high-skilled foreign workers of the right to work in the United States. </p>
<p>The <a href="https://www.upi.com/Top_News/US/2017/12/15/White-House-exploring-an-end-to-H-4-visa-program-for-spouses-of-H-1B-visa-holders/4811513351165/">apparent aim</a> is to promote Trump’s “Buy American, Hire American” <a href="https://www.whitehouse.gov/presidential-actions/presidential-executive-order-buy-american-hire-american/">executive order</a> issued in April. It’s also part of efforts to <a href="https://www.uscis.gov/archive/uscis-will-temporarily-suspend-premium-processing-all-h-1b-petitions">scale back</a> the H-1B visa program, which allows workers to bring spouses and children under H-4 visas. </p>
<p>Besides likely having a negative impact on industries that use H-1B visas, such as information technology, software development and finance, my own research shows that it will also, intentionally or not, disproportionately harm women. </p>
<h2>Immigration policy and families</h2>
<p>There is no shortage of opinions about the merits and drawbacks of the H-1B program. </p>
<p>Critics argue that the program has been abused by companies that seek to <a href="https://theconversation.com/candidates-plans-to-change-controversial-h-1b-guestworker-program-highlight-need-for-an-overhaul-55482">replace</a> American workers or pay them <a href="http://www.nber.org/papers/w23153">lower wages</a>. Advocates, meanwhile, point out that foreign workers increase <a href="http://people.ischool.berkeley.edu/%7Eanno/Papers/EDQ_on_immigrants_2002.pdf">innovation</a> and bring in <a href="https://www.brookings.edu/research/h-1b-visas-and-the-stem-shortage/">much-needed</a> high-skilled labor. </p>
<p>But there is another consideration left out of this debate: how the program directly affects the lives of the workers and their families. </p>
<p>Historically, family reunification has played a contentious role in U.S. immigration policy. Starting with the <a href="http://library.uwb.edu/Static/USimmigration/1875_page_law.html">Page Law of 1875</a> and the <a href="http://library.uwb.edu/Static/USimmigration/1882_chinese_exclusion_act.html">Chinese Exclusion Act of 1882</a>, women (predominately from Asia) were barred from migrating either as spouses or on their own. These laws were responsible for creating “bachelor societies” of immigrant men and <a href="http://scholarship.law.berkeley.edu/cgi/viewcontent.cgi?article=2174&context=facpubs">limited</a> the establishment of permanent Asian communities in the United States. </p>
<p>Changes to immigration <a href="http://library.uwb.edu/Static/USimmigration/1943_magnuson_act.html">law</a> in the mid-20th century began to recognize the need for family migration. The <a href="http://library.uwb.edu/Static/USimmigration/1965_immigration_and_nationality_act.html">Immigration and Nationality Act of 1965</a> further reversed earlier policy by giving naturalized citizens and legal permanent residents the power to sponsor family members and made reunification a weighted factor for immigration consideration. </p>
<p>A <a href="https://www.congress.gov/bill/101st-congress/senate-bill/358">1990 law</a> opened new avenues for family-based migration, creating the H-1B as a “temporary nonimmigrant visa” that prioritized highly skilled workers whose labor was needed for “<a href="https://www.uscis.gov/working-united-states/temporary-workers/h-1b-specialty-occupations-dod-cooperative-research-and-development-project-workers-and-fashion-models">specialized and complex</a>” jobs. </p>
<p>The visa is typically issued for three to six years to employers to hire a foreign worker. If employers choose to sponsor them, visa holders can then apply for permanent residency. </p>
<p>It also created the H-4 family reunification visa. Even though the United States Citizenship and Immigration Services <a href="https://www.computerworld.com/article/3050365/it-careers/how-many-h-1b-workers-are-male-us-wont-say.html">doesn’t</a> release gender data, some <a href="https://www.computerworld.com/article/3050365/it-careers/how-many-h-1b-workers-are-male-us-wont-say.html">estimate</a> that 85 percent of H-1Bs go to men. It is safe to presume that women make up the majority of H-4 spousal visas. </p>
<p>They are among the 22 “<a href="https://www.uscis.gov/working-united-states/temporary-nonimmigrant-workers">nonimmigrant</a>” visa categories that have family reunification provisions, but, like most of them, come with work restrictions. </p>
<h2>The impact of work restrictions</h2>
<p>Work authorization for the spouses of H-1B visa holders came into the spotlight in 2015. </p>
<p>The Obama administration issued an <a href="https://www.uscis.gov/news/dhs-extends-eligibility-employment-authorization-certain-h-4-dependent-spouses-h-1b-nonimmigrants-seeking-employment-based-lawful-permanent-residence">executive order</a> that year that allowed H-4 visa holders who were already in the process of applying for lawful permanent residency to also apply for employment authorization. Prior to the order, H-4 holders were unable to work or obtain a social security number.</p>
<p>The work authorization document is conditional, however. If the possessor’s spouse loses his H-1B visa, then the H-4 visa holder would also lose her authorization to work in the U.S. </p>
<p>I conducted a multi-year <a href="http://www.washington.edu/uwpress/search/books/BHAATH.html">study</a> of H-1B and H-4 visa holders that ended just after President Barack Obama’s 2015 order. My findings clearly showed the long-lasting negative effects of these work restrictions and how important work authorization is for immigrant families.</p>
<p>Even though spouses of H-1B workers tend to be <a href="https://qz.com/797831/the-h4-visa-and-the-desperation-of-indian-housewives-in-america/">highly educated</a>, often in STEM fields, after coming to the U.S. they effectively became housewives. Women are unable to contribute to the household financially and become dependent on their husbands. They cannot apply for changes in their immigration status without going through the primary visa holder. </p>
<p>This means that if an H-4 visa holder were to experience domestic violence, for example, she would be unable to leave without putting her visa status in <a href="https://law.ubalt.edu/centers/caf/pdf/Sabrina%20Balgamwalla.pdf">jeopardy</a>. </p>
<p>While Citizenship and Immigration Services did issue a <a href="https://www.uscis.gov/sites/default/files/USCIS/Laws/Memoranda/2016/2016-0308_PM-602-0130_Eligibility_for_Employment_Authorization_for_Battered_Spouses_of_Certain_Nonimmigrants.pdf">memorandum</a> in 2016 granting work authorization to abused spouses of nonimmigrants under the Violence Against Women Act, victims must have <a href="https://www.uscis.gov/forms/employment-authorization-certain-abused-nonimmigrant-spouses">proof</a> of abuse, such as police reports, court records or reports from social service agencies. As advocates have <a href="https://vawnet.org/sites/default/files/materials/files/2016-09/AR_Immigrant.pdf">shown</a>, this can be difficult for immigrant women to obtain, and many would rather <a href="https://www.npr.org/2017/03/21/520841332/fear-of-deportation-spurs-4-women-to-drop-domestic-abuse-cases-in-denver">drop domestic violence</a> cases than risk deportation.</p>
<p>In cases where an H-1B worker loses his job or experiences something worse, the rest of the family could be deported. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/199819/original/file-20171219-27538-1nfr2i5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/199819/original/file-20171219-27538-1nfr2i5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=359&fit=crop&dpr=1 600w, https://images.theconversation.com/files/199819/original/file-20171219-27538-1nfr2i5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=359&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/199819/original/file-20171219-27538-1nfr2i5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=359&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/199819/original/file-20171219-27538-1nfr2i5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=452&fit=crop&dpr=1 754w, https://images.theconversation.com/files/199819/original/file-20171219-27538-1nfr2i5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=452&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/199819/original/file-20171219-27538-1nfr2i5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=452&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Sunayana Dumala was denied entry into the U.S. after attending the funeral in India of her husband, an H-1B worker who was murdered.</span>
<span class="attribution"><span class="source">AP Photo/Orlin Wagner</span></span>
</figcaption>
</figure>
<p>This point was driven home dramatically in the case of Sunayana Dumala, the widow of H-1B worker Srinivas Kuchibhotla, who was <a href="https://www.wired.com/story/adam-purinton-shooting-olathe-kansas/">murdered</a> in Kansas by a white supremacist in February. After she returned to India for Kuchibhotla’s funeral, she was barred from reentering the U.S. since her deceased husband’s visa was no longer valid. Dumala’s state congressman intervened personally to help obtain her temporary work authorization and to apply for her own H-1B visa or a “U” visa, usually reserved for immigrant victims of crime. </p>
<p>Her case, which had the rare aid of a member of Congress, brings home the precariousness that dependents of temporary immigrant workers face.</p>
<p>Even in less horrific cases, the forced hiatus from the workplace that women face on the H-4 hurts their long-term career prospects. <a href="http://www.nytimes.com/2013/08/11/magazine/the-opt-out-generation-wants-back-in.html?pagewanted=all">Research</a> has shown women who leave or are pushed out of the workforce wherever they are in the world have a much harder time reentering the job market.</p>
<p>This issue is compounded by the fact that H-4 holders must find an employer to sponsor them on an H-1B, which are already in short supply, or <a href="http://www.timesnownews.com/international/article/indian-it-professionals-us-green-cards-backlogs-h-1b-visas-techies-immigration/111499">wait</a> potentially seven to 10 years until they become permanent residents to restart their careers. </p>
<p>H-4 women face a triple burden if they are able to start working again, particularly in technology: race, gender and long gaps in their resumes. </p>
<h2>Welcome relief</h2>
<p>Considering the negative impacts of H-4 work restrictions, the Obama-era rule change granting work authorization was <a href="https://www.seattletimes.com/seattle-news/eastside/high-tech-workers-spouses-welcome-new-immigration-rules/">welcome relief</a> for tens of thousands of dependent spouses. </p>
<p>For women who have been stymied at home, the chance to join the workforce is important both financially and <a href="http://money.cnn.com/2017/03/10/technology/h4-work-permits-trump/index.html">psychologically</a>, particularly in areas where H-1B workers are concentrated such as Silicon Valley, Seattle and New York. </p>
<p>For example, having two incomes offsets the high cost of living in regions where H-1B workers <a href="https://www.brookings.edu/blog/the-avenue/2015/04/02/the-h-1b-visa-race-continues-which-regions-received-the-most/">are concentrated</a>. In addition, <a href="https://www.imf.org/external/pubs/ft/sdn/2013/sdn1310.pdf">women’s participation</a> in the workforce <a href="http://reports.weforum.org/global-gender-gap-report-2015/the-case-for-gender-equality/">can translate</a> into greater gender equity at home.</p>
<p>Unfortunately, there has already been backlash to this expansion of the temporary workforce, including via a <a href="http://www.immigration.com/sites/default/files/SaveJobs-Lawsuit.pdf">lawsuit</a> to halt H-4 work authorization. Although that suit was initially rejected, now the Trump administration’s planned rule change revives the issue. </p>
<h2>What now</h2>
<p>As my research has shown, when women are given opportunities to grow their careers and become economically productive, they are more likely to stay in the U.S.</p>
<p>Losing talented workers who have already invested significant time and money (workers pay social security and other taxes regardless of immigration status) in the U.S. will deal a blow to our standing as the locus of technological innovation. There has already been a <a href="https://www.bloomberg.com/news/articles/2017-04-17/h-1b-applications-drop-as-u-s-employers-anticipate-reforms">drop</a> in the numbers of H-1B applications received in 2017 as foreign workers grow wary of the current political climate in the U.S. This latest restriction will only create more hesitation.</p>
<p>The H-1B program is undoubtedly in need of reform. Obama’s 2015 executive actions on immigration were far from perfect and left many problems unresolved, such as what will happen to children of H-1B workers who “age out” of their dependent visas after they turn 21 years old. Many have spent the majority of their childhoods in the U.S. but still are not permanent residents. They are left in limbo and, like the “<a href="https://theconversation.com/how-dreamers-and-green-card-lottery-winners-strengthen-the-us-economy-82571">Dreamers</a>,” potentially face the prospect of <a href="https://economictimes.indiatimes.com/nri/returning-to-india/why-children-of-h-1b-workers-may-now-have-to-leave-america/articleshow/61166125.cms">returning</a> to countries that they have never known. </p>
<p>Withdrawing work authorization for spouses who have been living in the U.S. for more than half a decade is a step in the wrong direction. Immigration reform needs more compassion, not less.</p><img src="https://counter.theconversation.com/content/89279/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Amy Bhatt does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A scholar explains why the president’s plan to overturn his predecessor’s rule would be a big mistake and disproportionately harm women.Amy Bhatt, Associate Professor of Gender and Women's Studies, University of Maryland, Baltimore CountyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/662202017-07-24T11:51:57Z2017-07-24T11:51:57ZMasterCard survives £14 billion class action but more could follow<figure><img src="https://images.theconversation.com/files/179413/original/file-20170724-24759-pjgfp8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Should convenience come at a cost?</span> <span class="attribution"><span class="source">nevodka / Shutterstock.com</span></span></figcaption></figure><p>Convenience often comes at a cost. As consumers, many of us are resigned to seeing a surcharge or “processing fee” on goods and services when we pay by credit or debit card. At present, it is lawful for businesses to charge consumers these fees although <a href="http://www.legislation.gov.uk/uksi/2012/3110/regulation/4/made">the amount should be limited</a> to the actual cost to the retailer of the transaction. </p>
<p>Bank charges for processing card payments <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/466783/Interchange_fee_regulation_response.pdf">were capped in the UK in 2015</a>, but many businesses have <a href="https://www.fairerfinance.com/business/blog/why-are-we-still-being-charged-for-paying-by-credit-card">continued to charge</a> consumers inflated fees to generate further profit. Even <a href="https://ion.icaew.com/taxfaculty/b/weblog/posts/revisedchargesforpayinghmrcbycreditcard">the government’s tax department</a> routinely adds a surcharge of up to 2.4% to bills paid by card.</p>
<p>Now, <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/629988/Implementation_of_the_revised_EU_Payment_Services_Directive_II_response.pdf">the government has announced</a> that charges for paying by debit or credit card will be outlawed completely from January 2018. This raises several questions, not least whether retailers will simply increase their prices to cover any shortfall. Many companies <a href="https://www.thetimes.co.uk/article/no-more-cheeky-credit-card-fees-fsvwdtb86">argue</a> that fees are there to cover their transaction costs, which consist of an “interchange fee”, levied by the card issuer such as Visa or MasterCard (capped by law at 0.3%) and the “merchant fee”, charged by the bank for handling each payment. This is not capped but for large businesses it should not amount to more than about 0.3%.</p>
<p>It is also unclear how the ban will be policed. Local authority Trading Standards departments are tasked with dealing with complaints from buyers, but the widespread flouting of the current cap indicates that embattled officers are <a href="https://www.tradingstandards.uk/news-policy/news-room/2016/trading-standards-experts-respond-to-gov-cutting-red-tape-review">under-resourced</a> to deal with the issue.</p>
<h2>Class action rejected</h2>
<p>Future charges are to be outlawed, but what about the millions in surplus fees paid by consumer buyers in the past? A recent attempt to secure £14 billion in compensation for UK consumers was <a href="http://www.catribunal.org.uk/238-9925/Judgment-CPO-Application.html">recently rejected</a> by the Competition Appeal Tribunal (CAT).</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/179436/original/file-20170724-10327-13yjxvq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/179436/original/file-20170724-10327-13yjxvq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/179436/original/file-20170724-10327-13yjxvq.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/179436/original/file-20170724-10327-13yjxvq.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/179436/original/file-20170724-10327-13yjxvq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/179436/original/file-20170724-10327-13yjxvq.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/179436/original/file-20170724-10327-13yjxvq.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The new law covers all card companies.</span>
<span class="attribution"><span class="source">dean bertoncelj / Shutterstock.com</span></span>
</figcaption>
</figure>
<p>The trailblazing claim against MasterCard, initiated by <a href="https://www.linkedin.com/in/walter-merricks-cbe-3487a139">Walter Merricks</a>, who was head of the Financial Ombudsman Service from 1999-2009, was the first collective claim of its kind under new rules introduced by the <a href="http://www.legislation.gov.uk/ukpga/2015/15/contents/enacted">Consumer Rights Act 2015</a>. </p>
<p>Previously, US-style class actions were not permitted under UK law and consumers affected by price fixing or anti-competitive behaviour had to either actively opt in as a named participant in a claim, or bring proceedings on their own behalf. In cases where the loss to the consumer was relatively small, the cost of bringing a claim meant that pursuing the trader was often not worthwhile. </p>
<p>Under collective proceedings rules, there is no need to register for a stake in the claim – anyone who fulfils the criteria is automatically joined in the action unless they expressly opt out. Under the new Consumer Rights Act, claims can be brought by a suitable representative of the group affected. In the Mastercard case it was Walter Merricks, on behalf of every consumer who purchased goods from a retailer in the UK between 1992 and 2008. </p>
<p>Had the claim succeeded, it would have given individual consumers the collective legal power to call a corporation to account. Ultimately, the claim faltered under the huge complexity of trying to quantify the total compensation payable, and then allocate it fairly among consumer claimants. Notwithstanding the CAT’s decision, the case has <a href="http://www.pymnts.com/news/regulation/2016/mastercard-uk-class-action-lawsuit/">prompted fears</a> from card companies that the UK will see a tsunami of similar claims, possibly resulting in vast payouts.</p>
<h2>Onslaught of action</h2>
<p>What happens next will be scrutinised closely by banks and other credit providers. The decision is the latest chapter in an <a href="https://www.ft.com/content/50342c2c-e703-11e6-893c-082c54a7f539">onslaught of legal action</a> against MasterCard dating back to 2007. The fees charged to retailers are determined in large part by interchange fees agreed between groups of banks and in 2007, MasterCard was subject to an investigation by the European Commission, which <a href="http://eur-lex.europa.eu/legal-content/en/TXT/PDF/?uri=uriserv%253AOJ.C_.2012.200.01.0011.01.ENG">ruled</a> that its interchange fees were anti-competitive and violated the EU Treaty.</p>
<p>MasterCard appealed the ruling but the European Court of Justice confirmed the decision in <a href="http://europa.eu/rapid/press-release_MEMO-14-528_en.htm">September 2014</a>. Fees were subsequently capped at 0.3% of the transaction value for credit card payments and 0.2% for debit card payments. </p>
<p>In July 2016 MasterCard was ordered to pay <a href="https://www.ft.com/content/35fcd220-49c2-11e6-8d68-72e9211e86ab">substantial damages to the supermarket Sainsbury’s</a>, after it successfully sued MasterCard over processing fees. While the court in this case acknowledged that electronic payment arrangements benefit both customers and retailers, it ultimately concluded that MasterCard’s charges were excessive and breached EU and UK competition law. This judgement potentially paves the way for a wave of further claims from retailers who were charged similar rates.</p>
<p>MasterCard is not the only lender affected. Visa was <a href="http://europa.eu/rapid/press-release_IP-10-462_en.htm?locale=en">also investigated in 2007</a>, but managed to avoid formal sanctions by agreeing voluntarily to reduce its fees and improve transparency around charging. </p>
<p>The British government’s move to scrap charges completely by January 2018 promises greater transparency over future prices paid by consumers. But, future class actions should not be ruled out. The recent rejection of Merricks’s case against MasterCard was down to the complexity of computing individual losses – if this issue is remedied then future claims could well succeed.</p><img src="https://counter.theconversation.com/content/66220/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Joanne Atkinson does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A recent ban on charges for paying by credit or debit card could open the door to legal action for surplus fees paid in the past.Joanne Atkinson, Principal Lecturer, Law, University of PortsmouthLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/797832017-06-26T15:12:58Z2017-06-26T15:12:58ZCould an African passport bring to life the dreams of Nkrumah, Senghor and Touré?<figure><img src="https://images.theconversation.com/files/175623/original/file-20170626-326-1rknuxj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Crossing borders have always been tough for Africans.
</span> <span class="attribution"><span class="source">Peter Andrews/Reuters</span></span></figcaption></figure><p>Embassies, visas and immigration officers. These things invoke nightmarish feelings in many people. This is particularly true in Africa.</p>
<p>One cannot fail to notice the hallmarks of post-colonial performances of power at the gates of embassies in the major cities of African countries. There is always that feeling of lowliness created in visa applicants by the performances of authority at embassies. There you will find military, police and sundry security companies wielding high-calibre weapons.</p>
<p>It’s not unusual to witness instances of humiliation. Sometimes they shout instructions at visa applicants. Sometimes they throw documents back at them.</p>
<p>They, it seems, have great talent and insatiable penchant for choreographic, inane demonstrations of power. Or, as Nigerian superstar Fela Ransome Kuti would say, <a href="http://songmeanings.com/songs/view/3530822107858832327/">“demonstration of craze”</a>.</p>
<p>Mostly, the wisdom of this endurance is the thought that there is an end in sight. Once you are handed your visa, its magical powers will at once restore your humanity. But before that is done, these visa applicants, these believers in the proverbial greener pasture on the other side, have to undergo the noisome purification process of psychological terrorism.</p>
<p>Against this background is <a href="http://www.bbc.com/news/world-africa-36823644">the idea that</a> the African Union wants to introduce an African passport. It’s apt to raise the hopes of many people for different reasons. At least, some will think, this passport will restore the dignity and self-worth of Africans. It will allow them to travel without visas to all of the 54
countries that make up the African Union. </p>
<p>If anything, Africans will no longer have to deal with the excesses of embassy staff and their security personnel.</p>
<p>I believe that the new passport could be taken to represent a new political agenda that is worth fighting for. </p>
<h2>Visa free travels</h2>
<p>Countries in the so-called Global North are striving to outdo one another in the race for their closed border utopia. African countries though, seem to be pushing strongly for open borders within the continent. But before basking in boisterous self-congratulation, it seems cogent to ask why an open border policy would be reasonable.</p>
<p>What justifies the decision of African leaders to pursue visa-free travel within the continent by 2018?</p>
<p>International travel for many Africans has often meant travel to countries in the Global North. The reality is that the Global North benefits from any gains derived from Africans undertaking international travel. </p>
<p>A possible argument for the African passport would be that it would help African countries end these historical patterns, and in so doing reap the gains that accrue from free movement within the continent.</p>
<p>Under this scenario, the African passport would allow African countries to profit from tourism. It would also help to shear mentally colonised Africans of their braggadocio which they often express by reminding people of how well-travelled they are, just because they’ve visited Paris, London or New York. </p>
<p>So travels to Bujumbura, Johannesburg, Lagos, Kampala and other cities on the continent would be international travel people could take pride in. And with this change in perception, the gains would begin to accrue to African countries.</p>
<h2>Reasons in favour</h2>
<p>What of the argument that the Africa passport can advance African cultural heritage? The crux of this argument is that Africa is a cultural community which shouldn’t be imprisoned by colonial border restrictions enforced by post-colonial states. The African passport might therefore bring to life the dreams of pan-Africanism dreamt by scholar-statesmen such as <a href="http://www.dw.com/en/ghanas-kwame-nkrumah-visionary-authoritarian-ruler-and-national-hero/a-19070359">Kwame Nkrumah</a>, <a href="http://www.nytimes.com/2001/12/21/world/leopold-senghor-dies-at-95-senegal-s-poet-of-negritude.html">Leopold Senghor</a>, <a href="http://www.blackpast.org/1959-sekou-toure-political-leader-considered-representative-culture">Sékou Touré</a>. </p>
<p>The cultural argument, therefore, is that the African passport will help the advancement of the African cultural community because free movement would provide the opportunity for increased contact and, hence, cultural exchange.</p>
<p>There’s a political argument for the African passport too. The open borders might also well mean the development of a positive political agenda for African countries that have struggled for too long to mitigate the deficit between what independence promised and what it brought about.</p>
<p>In other words, the African passport could be the viable response to the situation scholars such <a href="https://www.nytimes.com/2014/10/22/us/ali-mazrui-scholar-of-africa-who-divided-us-audiences-dies-at-81.html">Ali Mazrui</a> and others have called the <a href="http://www.tandfonline.com/doi/full/10.1080/01436597.2015.1013317?src=recsys">African predicament</a>. Although African countries were mainly creations of the struggle for freedom, Africans today have become prisoners of this freedom. Largely, it’s a multitude trapped in spaces created by their affirmation of freedom through independence. </p>
<p>And the introduction of an African passport has the capacity to redirect the discourse on migration in a way that makes neglected questions the centre of attention. This is the case because of the type of migration it will bring about – increased migration of Africans within Africa. </p>
<p>As such it could offer resistance to the frequent sacrifice of young African lives on the altar of the dreams about Europe erected in <a href="http://www.bbc.com/news/world-europe-31501782">Lampedusa</a>, the small Italian island with its bulging migrant reception centre. </p>
<p>Imagining open borders within Africa presents an opportunity to reinsert real world questions into the mainstream of political and social thought on immigration.</p><img src="https://counter.theconversation.com/content/79783/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Uchenna Okeja does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The introduction of an African passport has the capacity to bring about increased migration of Africans within Africa.Uchenna Okeja, Senior Lecturer in Philosophy, Rhodes UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/765792017-04-24T06:41:58Z2017-04-24T06:41:58Z457 visa changes won’t impact on wider temporary education workforce. And maybe that’s deliberate<figure><img src="https://images.theconversation.com/files/166417/original/file-20170424-12650-s7r721.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">International student visa allows you to work up to 20 hours a week.</span> <span class="attribution"><span class="source">from www.shutterstock.com</span></span></figcaption></figure><p>The Turnbull Government’s decision to scrap the 457-skilled temporary worker visa puts the spotlight on temporary migrant workers in Australia. </p>
<p>This is not surprising, since each year Australia takes in some 700,000 temporary migrants and 200,000 permanent migrants.</p>
<p>What is surprising is the under-estimated role of the Australian tertiary education sector in temporary worker migration, the reason why universities have been among the most <a href="https://www.theguardian.com/australia-news/2017/apr/20/universities-fear-457-visa-changes-will-harm-ability-to-attract-academic-talent">outspoken critics</a>. </p>
<h2>Bulk of temporary migrant labour force will remain</h2>
<p>Most obvious here is the demand side - universities employ about <a href="http://www.sbs.com.au/news/article/2017/04/20/pure-lunacy-university-heads-warn-turnbull-visa-changes-will-gut-teaching-staff">1,500 lecturers</a> and 250 tutors on 457 visas. </p>
<p>Universities are also worried about the impact of the axing of the 457 visa on international PhD students gaining Australian employment after graduation. They could not fulfil their research, teaching and innovation agendas without ready access to globally-mobile academics. </p>
<p>Less obvious is the supply side: the fact that international students enrolled at Australian universities provide temporary work that is the equivalent of more than three times the size of the 457 visa program. </p>
<p>In addition to the 457 program, Australia receives about 250,000 temporary migrants on working holiday maker visas (WHMs) a year, who also add considerably to the temporary migrant workforce.</p>
<p>If the problem the government was addressing - by abolishing the 457 program – is that of temporary migrant workers, their impact on jobs in Australia and their experiences of exploitation, it has targeted a fraction of the problem, leaving the bulk of the temporary migrant labour force unchanged. </p>
<h2>International students bring in the money</h2>
<p>Could this be because international education is the third largest export earner in Australia, contributing <a href="https://internationaleducation.gov.au/research/.../Export%20Income%20FY2015-16">$19.9 billion in 2015-16</a>, while a continued resupply of WHMs are critical for the seasonal labour supply for <a href="https://rirdc.infoservices.com.au/items/16-027">Australia’s agricultural industry</a>, as well as restaurant and services jobs in the cities?</p>
<p>We know that Australian universities rely on international students much more than universities in other countries. </p>
<p>International students are more prominent in Australia than in any other OECD countries, with the exception of Luxembourg:</p>
<ul>
<li><p>In 2012 international students comprised 18.3% of all tertiary enrolments in Australia compared to the <a href="http://www.oecd-ilibrary.org/social-issues-migration-health/international-migration-outlook-2014_migr_outlook-2014-en">OECD average of 7.6%</a>.</p></li>
<li><p>In 2015, <a href="https://www.universitiesaustralia.edu.au/ArticleDocuments/169/Data%20snapshotv6%20webres.pdf.aspx">271,354</a> international students were enrolled in Australia universities.</p></li>
<li><p>In 2016, Australia took in a record <a href="https://internationaleducation.gov.au/research/International-Student-Data/Documents/MONTHLY%20SUMMARIES/2016/12_December_2016_FullYearAnalysis.pdf">554,179</a> full-fee paying international students. </p></li>
</ul>
<h2>Student visa also a temporary work visa</h2>
<p>Because the international student visa permits international students to work up to 20 hours per week, it is also a temporary migrant worker visa. </p>
<p>Assuming all international tertiary students work 20 hours per week, this is the equivalent workforce impact of an extra 146,677 457 visa holders working a 37 hour week, or more than three times the total intake (<a href="http://www.abc.net.au/news/2016-11-15/what-is-a-457-visa/8026280">45,400</a>) of 457 visas workers last year.</p>
<p>This is a conservative estimate, since research suggests that many are forced to work longer hours to make ends meet in Australia.</p>
<p>According to many judgements and reports made by the Fair Work Commission, the evidence suggests that many international students are exploited, paid under award wages in often substandard workplaces. </p>
<h2>International students working longer hours</h2>
<p>The most notorious recent example of systematic exploitation of international student workers is the case of the international 7-Eleven franchise.</p>
<p>According to one <a href="https://www.fairwork.gov.au/about-us/access-accountability-and-reporting/inquiry-reports#7-11">report</a>:</p>
<blockquote>
<p>A common payroll fraud employed by 7-Eleven franchisees is known as the ‘half-pay scam’, where staff members are paid for only half the hours they work. Under the half-pay scam, a worker is forced to work for 40 hours a week for an average of $12 per hour against an award rate of $24 per hour. </p>
<p>As part of the scam the franchisee will doctor the roster and fudge time sheets to make it appear that the staff member has only worked half the hours in the store that they have actually worked.</p>
</blockquote>
<p>According to the <a href="http://www.pc.gov.au/inquiries/completed/migrant-intake/report">Productivity Commission</a>, about half of permanent visa grants are to people who are already in Australia as temporary immigrants.</p>
<p>Many 457 and international student visa temporary migrants eventually become permanent. This makes a lot of sense: those on one or more temporary visas have experience living and working in Australia, have often accumulated human capital from Australian universities and developed social networks (social capital) within Australia and improved their English (linguistic capital). </p>
<p>It is this ability for migrants to transition from temporary to permanent visas that is the strongest argument against the claim that Australia has abandoned the settler immigration model that worked so well for five or six post-war decades in favour of a guest-worker immigration model.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/166415/original/file-20170424-23807-1buefge.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/166415/original/file-20170424-23807-1buefge.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=365&fit=crop&dpr=1 600w, https://images.theconversation.com/files/166415/original/file-20170424-23807-1buefge.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=365&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/166415/original/file-20170424-23807-1buefge.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=365&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/166415/original/file-20170424-23807-1buefge.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=458&fit=crop&dpr=1 754w, https://images.theconversation.com/files/166415/original/file-20170424-23807-1buefge.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=458&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/166415/original/file-20170424-23807-1buefge.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=458&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption"></span>
<span class="attribution"><a class="source" href="http://www.pc.gov.au/inquiries/completed/migrant-intake/report/migrant-intake-report.pdf">Department of Immigration and Border Protection/ Productivity Commission report p.420</a></span>
</figcaption>
</figure>
<h2>Ripped off?</h2>
<p>Sometimes the journey to permanent residence in Australia is via a series of temporary visas, a sort of boomerang migration pathway. </p>
<p>According to the <a href="http://www.pc.gov.au/inquiries/completed/migrant-intake/report">Productivity Commission</a>, </p>
<blockquote>
<p>“The number of former international students who use the multi-step pathway to a graduate visa followed by permanent skill stream immigration has increased”. </p>
</blockquote>
<p>For example, over the period 1991–2014, 34,340 people transferred from an international student visa to a temporary skilled visa (12,870 of these to a 457 visa).</p>
<p>However, one consequence of the decision to scrap the 457 visa and replace it with a temporary skilled workers visa with a short-term stream (two years without a pathway to permanent residence) and a medium-term stream (four years with a pathway to permanent residence) is that it reinforced the guest-worker character of Australia’s current immigration program. </p>
<p>This undermines national building in Australia and seems at odds with the Turnbull Government’s increased focus on <a href="http://www.abc.net.au/news/2017-04-20/migrants-to-face-tougher-tests-for-australian-citizenship/8456392">successful citizenship outcomes</a> and a redefined multicultural policy that recognised that the country’s <a href="http://www.news.com.au/national/politics/three-changes-the-turnbull-government-has-made-to-australias-multicultural-statement/news-story/772da543dbda3650ccf9eba818747a61">“multilingual workforce”</a> is a competitive edge in an increasingly globalised economy. </p>
<hr>
<p>• <strong>This article was amended on 24 April to correct a factual inaccuracy. The article said “Australia receives about 250 million temporary migrants on working holiday maker visa”, when it should have said 250,000.</strong></p><img src="https://counter.theconversation.com/content/76579/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jock Collins receives funding from the Australian Research Council. </span></em></p>By abolishing the 457 visa program the government has targeted a fraction of the problem, leaving the bulk of the temporary migrant labour force unchanged.Jock Collins, Professor of Social Economics, UTS Business School, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/571182016-04-04T05:13:17Z2016-04-04T05:13:17Z‘Backpacker tax’ will put more strain on labour shortage<p>The so called “backpacker tax” on Working Holiday Maker visa holders, announced in the 2015 Budget, will not only deter tourists from working in Australia but also put strain on industries that have come to rely on this workforce.</p>
<p>Following strong criticism from industry groups representing Australia’s agricultural and tourist industries, the federal government has launched a <a href="http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/BudgetReview201516/Holiday">review of the measure</a>, which would require employers to deduct 32.5 cents in every dollar earned by the visa holders.</p>
<p>The measure would override present taxation arrangements, which exempt all income earners from paying tax on income below a threshold of A$18,200. The government maintains that the measure is designed to assist in addressing the budget deficit, and that it’s modelling forecasts that this will generate A$540 million over a three-year cycle. </p>
<p>Farmers, including the National Farmers Federation, <a href="http://www.nff.org.au/read/5182/petition-launched-against-proposed-backpackers-tax.html">which is spearheading a campaign against the backpackers’ tax</a>, and the <a href="http://www.vtic.com.au/victorian-tourism-businesses-call-for-proposed-backpacker-tax-to-be-abandoned/;%20http://www.tourismcouncilwa.com.au/backpacker-tax-would-devastate-regional-wa-tourism/14837;%20http://www.hotelmanagement.com.au/2016/03/18/review-of-australias-backpacker-tax-welcomed/">tourist industry</a> argue that the tax will act as a significant disincentive to prospective international tourists wanting to work in Australia for some part of their holiday. The organisation <a href="http://www.nff.org.au/read/5182/petition-launched-against-proposed-backpackers-tax.html">says this will have a detrimental effect</a> for industries that have come to rely “on backpackers to fill severe labour shortages which are often seasonal and temporary.”</p>
<p><a href="https://www.englishaustralia.com.au/article.php?group_id=3356">Anecdotal evidence</a> suggests that increases in the visa application fee – following the adoption of the “user-pays” system in December 2012, from A$280 to A$360 in January 2013 to a planned increase of $440 in July 2016 – have acted as a deterrent to prospective working tourists. </p>
<p>The Working Holiday Maker visa is now considerably more expensive than the cost of similar working holiday schemes available in other comparable countries. Canada and New Zealand charge $C250 ($A250) and $NZ208 ($A186) respectively. And the visa also costs substantially more than a tourist visa. </p>
<p>This increased cost has coincided with <a href="https://www.border.gov.au/ReportsandPublications/Documents/statistics/working-holiday-report-dec13.pdf#search=working%20holiday%20makers">declining visa applications</a> from Ireland, Taiwan and South Korea, which have been among the top five source countries. The negative trend continued into 2014, with grant applications from each of the top five source countries – United Kingdom, Germany, France, South Korea and Taiwan – declining. </p>
<p>South Korea and Taiwan <a href="https://www.border.gov.au/ReportsandPublications/Documents/statistics/working-holiday-report-dec14.pdf#search=working%20holiday%20makers">displayed the largest drop-off</a> in applications of 20%.
Overall, there was a decline of 10.9% in the six months to December 2014 compared with the previous comparable period. </p>
<p>The ramifications of this trend for those industries that have <a href="http://ausfoodnews.com.au/2016/01/11/australian-vegetables-threatened-bydropping-backpacker-numbers.html;%20http://www.abc.net.au/news/2016-01-08/backpacker-worker-shortage-putting-strain-on-fruit-harvesting/7075674">become more reliant on backpackers</a> to meet seasonal labour needs is all the more worrying given that there is also a fall-off in applications for second Working Holiday Maker visas. Tourists on these visas, who had proved their employment worth by working for a minimum of 88 days in designated occupations and industries in need of labour, could apply for a second 12-month visa. </p>
<p>As the Department noted in a joint submission to the <a href="http://www.aph.gov.au/Parliamentary_Business/Committees/Joint/Migration/Seasonal_Worker_Programme/Submissions">Joint Standing Committee on Migration Inquiry into the Seasonal Worker Programme</a> in 2015, the second Working Holiday Maker visa scheme was specifically introduced to “to address acute ongoing labour shortages in certain industries across regional Australia”. </p>
<p>There are now fewer applications for second visas being made, with applications from Taiwanese South Koreans declining by over 13% in 2014. In noting the decline in these second visa applications granted in 2013, the Department of Immigration and Border Protection <a href="https://www.border.gov.au/ReportsandPublications/Documents/statistics/working-holiday-report-dec13.pdf">speculated that</a>:</p>
<blockquote>
<p>“Economic recovery in some partner countries and seasonal variability in visa application numbers are other potential contributors to the reduction in first Working Holiday visa application grant numbers during the first half of 2013-14.”</p>
</blockquote>
<p>However each of the countries from which substantially fewer Working Holiday Maker visa applications were made – Ireland, South Korea and Taiwan – has <a href="http://www.tradingeconomics.com">experienced reasonably sustained economic recovery</a> this decade. This would normally be a trigger for more applications as, the more buoyant the economy, the greater the likelihood that people have the resources to travel overseas for work and holiday. </p>
<p>Moreover, <a href="http://www.age-of-migration.com/">as migration theory explains</a>, once a flow of people has been set in train, migration networks develop that make transnational movement and employment search easier. As part of my research, I have observed these in Australia, and this should translate into a greater number of working holiday makers. The decline in numbers demands more consideration be given to the consequences of the increasing cost of the Working Holiday Maker visa.</p>
<p>The prospect of losing one third of earnings through an income tax, being taxed at a much higher rate than others (including citizens, residents, other temporary migrants and international students), while not having access to the social services and other support that taxes afford citizens and most residents, will all inevitably influence a further decline in Working Holiday Maker applications. All this while prospective working tourists turn to <a href="http://workingholidayincanada.com/get-your-tax-refund/">Canada</a> and <a href="https://www.visafirst.com/en/new_zealand_working_holiday_visa_info.asp">New Zealand</a> where the taxation regimes are not so pointedly onerous and discriminating. </p>
<p>Of course, these declining visa applications could be attributed to greater exposure of the exploitative conditions of employment <a href="http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Education_and_Employment/temporary_work_visa/Report">experienced by many of these visa holders</a>. Being paid less than set-industry rates of remuneration and/or being subjected to abusive and exploitative practices are obvious disincentives to considering combining work with a holiday in Australia. </p>
<p>The removal of the tax threshold for Working Holiday Makers will likely do nothing to redress the exploitative situations. Paradoxically, the imposition of the tax may compound the problems because it will discourage the number of prospective visa holders, exacerbating the <a href="http://ausfoodnews.com.au/2016/01/11/australian-vegetables-threatened-by-dropping-backpacker-numbers.html">“acute labour shortages”</a> that the scheme was established to help overcome.</p>
<p>Confronted by labour shortages, employers may see no alternative to, and actually see benefits in, employing backpackers on a cash-in-hand basis. Just as Working Holiday Makers – as well as tourists who do not have a Working Holiday Maker visa – face a labour market <a href="http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Education_and_Employment/temporary_work_visa/Report">in which there are few real alternatives</a> for supplementing their savings than to accept work on a cash, tax-avoiding basis.</p><img src="https://counter.theconversation.com/content/57118/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Stuart Rosewarne is affiliated with the Sydney Asia Pacific Migration Centre at the University of Sydney. </span></em></p>Changes to the way tourists on the Working Holiday Maker visa are taxed will deter them and may put more pressure on labour shortages.Stuart Rosewarne, Associate Professor, Department of Political Economy, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/498942015-11-24T23:57:28Z2015-11-24T23:57:28ZVisa concerns for Australians living in Bali provide an unwanted reality check<p>More than 10,000 Australians are estimated to <a href="http://urbanet.curtin.edu.au/projects/aus-migration.cfm">live in Bali</a> all year, or for a substantial part of it. While many consider themselves to be permanent residents, they in fact have very little legal basis for this claim.</p>
<h2>The visa challenge</h2>
<p>The Indonesian government provides Australian nationals with a <a href="http://www.visabali.com/index.php">number of visa options</a> to support their “visit” to Bali. These include:</p>
<ul>
<li><p>Tourist visa – valid for 30 days (or 60 days if arranged in selected countries within Asia);</p></li>
<li><p>Business visa – valid for 60 days (or 12 months for a multiple-entry business visa);</p></li>
<li><p>Employment visa – valid for one year and must be sponsored by an Indonesian-based company;</p></li>
<li><p>Social-cultural visa – valid for 60 days and can be extended monthly to a maximum of six months. Visas must be sponsored by an Indonesian citizen;</p></li>
<li><p>Family/dependent visa; and</p></li>
<li><p>Retirement visa – valid for one year and can be extended each year for up to five years.</p></li>
</ul>
<p>Beyond these visa options, there is little scope for Australian nationals to achieve permanent resident status. While there is a <a href="http://aifis.org/wp-content/uploads/2011/08/kitas_kitap.pdf">permanent residence permit</a>, it is available only for a five-year period.</p>
<p>Australian expats have adopted a range of strategies for securing and renewing their short-term visas in order to live year-round in Bali. One significantly popular approach sees expats leave Bali for a short period – often a few days – before applying for a new visa upon re-entry. Longer-term members of the expat community have reportedly used this strategy for many years.</p>
<p>However, a recent decision by the Indonesian Immigration Office looked set to present challenges to the widely practised visa renewal method. Initially, it looked like it may prevent many Australians from living “permanently” in Bali. It is unclear if the directive has been enforced, or whether it may have been <a href="http://www.balidiscovery.com/messages/message.asp?Id=12622">revoked</a>.</p>
<p>Under the initial directive, from October 20 until December 30, 2015, visitors to Indonesia – entering through Denpasar International Airport – will be <a href="http://balipedia.com/bali-news/immigration-cracking-down-on-visa-runs">denied entry</a> if they had previously entered the country twice in less than one year and been issued a visa on arrival.</p>
<p>The directive indicates that the action is in response to complaints from tourism organisations. The complaints primarily focus on the increasing number of expats working illegally in tourism businesses in Bali. </p>
<p>A <a href="http://balipedia.com/bali-news/immigration-cracking-down-on-visa-runs">translation</a> of the directive specifically identifies that tourism organisations are concerned that expats have been working illegally as waiters, tour guides and scuba instructors, and also providing concierge services for tours and businesses.</p>
<p>This measure is targeted at curbing the number of foreigners working illegally in Bali. But Australians who “permanently” live in Bali could also be facing an unwanted reality check regarding their rights to enter – and even remain in – Bali.</p>
<h2>Permanent residents or temporary visitors?</h2>
<p>Indonesia’s shifting approach on immigration will force Australian expats who renew their visas through frequent travel to revisit their plans.</p>
<p>A <a href="http://onlinelibrary.wiley.com/doi/10.1111/1745-5871.12155/pdf">recent survey</a> of Australians living in Bali revealed that, from a sample of 185 people, 68% renewed their visas by regularly travelling out of Bali. Those who did not travel out of Bali typically held retirement or business visas, renewing them through a local agent.</p>
<p>The survey asked Australian expatriates why they had moved to, and how they felt about living in, Bali. People fundamentally made a conscious decision to move to Bali to achieve a lifestyle they felt would not be available to them in Australia. </p>
<p>The distinct characteristics of Bali’s natural and cultural environment were the major factors drawing people to it. The lower living and housing costs were also important in influencing decisions to move.</p>
<p>Importantly, participants in the study identified Bali as their primary home, where their social networks and activities were based and, in some cases, where they achieved their main income. Irrespective of the type of visa they held, many had invested in property and become engaged in community activities.</p>
<p>The population of Australians living in Bali continues to grow. However, the directive from the Indonesian Immigration Office serves as a reminder of the reality of their situation. Australian expats are not “permanent” residents of Indonesia. While they might consider Bali to be their home, they are only temporary visitors.</p>
<hr>
<p><em>This piece has been amended since publication.</em></p><img src="https://counter.theconversation.com/content/49894/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Amanda Davies does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A recent decision by the Indonesian Immigration Office is set to present challenges to the widely practiced, and popular, ‘visa run’ renewal method.Amanda Davies, Senior Lecturer in Geography and Social Demography, Curtin UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/484102015-10-01T08:24:17Z2015-10-01T08:24:17ZChip-enabled cards may curb fraud, but consumers will be picking up the tab<p>Most of us have by now received new credit cards in the mail embedded with “EMV” (Europay-MasterCard-Visa) chips. Merchants across the country have been hastily investing large amounts of money in new EMV-compliant terminals. </p>
<p>This is because today marks the moment that <a href="http://www.bloomberg.com/news/articles/2015-09-29/what-that-chip-in-your-new-credit-card-means-for-you">retailers become liable</a> for fraud that occurs in their stores if they haven’t upgraded their old credit card readers to the new payments standard – an inducement intended to hurry along the transition.</p>
<p>This shift is commonly thought to be speeding us toward a more secure and less fraudulent future. But who really benefits – and who bears the costs – of this step in the transition to a cashless society is not as clear cut as it seems.</p>
<h2>EMV comes to America, almost</h2>
<p>EMV is a standard for payment cards and terminals in which the data are stored on integrated circuits (the chip) rather than on a magnetic stripe. In most countries that have adopted EMV, a personal identification number (PIN) is used to verify payment rather than a signature. For the time being, a less-secure signature will be used in the US. With compatible terminals, they also allow contactless payments (through so-called near-field communication), which require no authentication up to a certain monetary limit.</p>
<p>The technology is not new. France was one of the earliest adopters of the standard way back in 1992 and since then, <a href="http://www.greensheet.com/emagazine.php?story_id=3463">over 200 countries</a> have joined in. The United States has been very late to the party, but it’s finally making the switch. </p>
<p>A key milestone in this transition is occurring today: the liability shift. </p>
<p>From today onward, the liability for fraud committed at the point of sale (POS) on a non-EMV compliant terminal will no longer be borne by the card issuer but, instead, by the merchant. <a href="http://www.reuters.com/article/2015/03/03/us-usa-cybersecurity-retail-insight-idUSKBN0LZ0GC20150303">One estimate</a> puts the total cost for the EMV rollout at US$8.65 billion. The very strong financial incentive of shifted liability is why merchants are willing to adopt the terminals at such great expense.</p>
<h2>An imperfect security upgrade</h2>
<p>EMV-enabled payments are supposed to reduce fraud due to certain security features. In some countries, they do away with the signature-based method of authentication in favor of a PIN code. The merchants do not retain the PIN entered at the point of sale by the consumer. They use cryptographic algorithms to authenticate the cardholder and transaction.</p>
<p>As with any security system, EMV is a long way from perfect. <a href="https://www.youtube.com/watch?v=gj6wgQrymYI&index=25&list=PL491DCFF8887060BA">A number of different ways</a> to hack EMV have been known for some time. </p>
<p>Researchers at <a href="http://www.cl.cam.ac.uk/research/security/banking/nopin/press-release.html">the University of Cambridge</a>, for example, have shown that the card-reader terminals can be hacked to accept any PIN the criminal inputs. <a href="http://www.smh.com.au/it-pro/security-it/atm-skimmers-go-wireless-20140423-zqy2x.html">In a practice called ATM-skimming,</a> thieves can install a fake PIN pad on an ATM to trick consumers into providing card information, including their PIN, which can then be used to commit fraud. </p>
<p>The near-field communications (NFC) feature allows card users to pay by tapping their card against a reader. The unencrypted card number and expiration date, which emit from the chip, <a href="http://www.abc.net.au/news/2014-05-30/electronic-pickpocketing-looms-as-next-credit-card-fraud-threat/5486806">can be intercepted with a remote RFID device and subsequently used to commit fraud</a>. It’s a bit like pickpocketing in the digital age. </p>
<p>Given the enormous cost of this transition, and the imperfect security of EMV, we need to ask: how large are the benefits from EMV in terms of curbing fraud? </p>
<h2>A race to the bottom</h2>
<p>Evidence from other countries suggests that card-present fraud (face-to-face transactions) goes down following EMV adoption, as the charts below on the <a href="https://www.frbatlanta.org/-/media/Documents/rprf/rprf_pubs/120111wp.pdf">UK</a> and the <a href="https://www.ecb.europa.eu/pub/pdf/other/4th_card_fraud_report.en.pdf">Single Euro Payments Area</a> (SEPA) show. </p>
<p>However, the graphs also show a “race to the bottom” as fraudsters migrate to cross-border and “card-not-present” fraud (via the internet, phone or mail), considered much easier because EMV’s security measures, like entering a PIN, don’t work online. For an idea of the scale, <a href="https://www.ecb.europa.eu/pub/pdf/other/4th_card_fraud_report.en.pdf">in the SEPA</a>, 66% of all fraud resulted from card-not-present payments in 2013, compared with just 46% in 2008. </p>
<iframe src="https://datawrapper.dwcdn.net/QQIYL/7/" frameborder="0" allowtransparency="true" allowfullscreen="allowfullscreen" webkitallowfullscreen="webkitallowfullscreen" mozallowfullscreen="mozallowfullscreen" oallowfullscreen="oallowfullscreen" msallowfullscreen="msallowfullscreen" width="100%" height="400"></iframe>
<iframe src="https://datawrapper.dwcdn.net/SXj1u/10/" frameborder="0" allowtransparency="true" allowfullscreen="allowfullscreen" webkitallowfullscreen="webkitallowfullscreen" mozallowfullscreen="mozallowfullscreen" oallowfullscreen="oallowfullscreen" msallowfullscreen="msallowfullscreen" width="100%" height="400"></iframe>
<p>This broad pattern has been repeated in almost all developed EMV markets, including Australia and Canada. </p>
<p>So if EMV has proven to be an imperfect standard and merely migrates fraud from one category to another, why then push to adopt it at such an enormous cost? </p>
<h2>Who gains from EMV</h2>
<p>Card issuers and banks will benefit from a likely drop in card-present fraud of 15% to 35% over the next three years if the pattern of declines in other countries following the switch holds. Considering that <a href="http://www.phil.frb.org/consumer-credit-and-payments/statistics/">such fraud was $2.2 billion in 2012</a>, savings could be $342 million to $797 million a year. </p>
<p>This may be offset by the shift in fraud to card-not-present payments, which increased 40% to 100% in the three years following EMV implementation in Australia, Canada and the UK. <a href="http://www.phil.frb.org/consumer-credit-and-payments/statistics/">Such fraud in the US was $1.6 billion in 2012</a>, so we could see anything from $624 million to $1.6 billion more in the next few years. Given that the fraud is simply reallocated from card-present transactions though, a lower-bound estimate of $624 million is the more likely outcome. </p>
<p>Who will pay the price for this increased card-not-present fraud? The <a href="https://www.fdic.gov/regulations/laws/rules/6000-1350.html">onus</a> is on the card issuer or bank to prove that the merchant did not take the necessary measures to secure the transaction. </p>
<p>But to meet this standard, merchants will have to implement an additional layer of security, at an indirect cost to sales, provided by the payment service providers, called a 3D Secure protocol program. If a fraudulent card-not-present transaction gets through that, the issuer or bank carries the liability. </p>
<p>For all the billions of dollars in additional security investment, overall fraud levels will likely remain pretty stable. So why are we doing it?</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/96692/original/image-20150929-30986-1mg445s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/96692/original/image-20150929-30986-1mg445s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/96692/original/image-20150929-30986-1mg445s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/96692/original/image-20150929-30986-1mg445s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/96692/original/image-20150929-30986-1mg445s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/96692/original/image-20150929-30986-1mg445s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/96692/original/image-20150929-30986-1mg445s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">American tourists to Europe should be already familiar with this device.</span>
<span class="attribution"><span class="source">Card reader via www.shutterstock.com</span></span>
</figcaption>
</figure>
<h2>The fraud sideshow</h2>
<p>A deeper look reveals an interesting aspect to the card payments industry. For all the attention paid to rising fraud losses borne by banks, it turns out we already cover the cost, as consumers, with or without EMV.</p>
<p>An “<a href="http://www.businessweek.com/smallbiz/running_small_business/archives/2009/10/merchants_seek.html">interchange fee</a>” is imposed on every transaction that takes place with a card, typically 1% to 2%, and is used to cover fraud losses, reward programs and other processing costs. Merchants pay the fee, but typically <a href="http://www.nytimes.com/2010/01/05/your-money/credit-and-debit-cards/05visa.html">pass it on</a> to consumers in the form of higher prices. </p>
<p>A rough estimate places total interchange fee revenue at $45 billion to $90 billion in the US in 2012 (based on the <a href="http://www.phil.frb.org/consumer-credit-and-payments/statistics/">$4.5 trillion</a> in debit, credit and prepaid card transactions that year). For comparison, total fraud, across all categories, in the US was <a href="http://www.phil.frb.org/consumer-credit-and-payments/statistics/">$6.4 billion</a> – about a tenth of the fee revenue. </p>
<p>So why are merchants (in effect, consumers) paying billions of dollars to shift to a new card standard when they are already forking over tens of billions to issuers and banks to cover the costs of fraud? Add to that, the total amount of fraud following EMV basically stays the same. </p>
<p>It’s particularly odd, given the operating margins of MasterCard and Visa hover around <a href="http://investorplace.com/2015/09/mastercard-visa-stock-mobile/">54% and 65%, respectively</a>, suggesting they have plenty of breathing room to make this hefty investment in fraud-prevention themselves.</p>
<p>In other countries, interchange fees were cut to encourage merchants to adopt EMV terminals. But thus far, this doesn’t appear to be happening in the US. And since two companies, Visa and MasterCard, <a href="https://www.quora.com/What-is-the-marketshare-of-Visa-AMEX-Discover-and-Mastercard?share=1">control 75% of the market</a>, there’s little incentive for them to cut this lucrative revenue stream.</p>
<h2>Questions for our brave new digital world</h2>
<p>While the convenience of technological advances like electronic payments, and security from standards like EMV, cannot be denied, it’s important that we give thought to – and are properly informed of – the price that we pay. </p>
<p>The upgrade to EMV and its touted benefits, including reduced fraud, are not as compelling as we’re led to believe. In the end, the cost for this upgrade is being footed by merchants and, ultimately, consumers, through opaque fees and higher prices, while the limited benefits accrue to the card issuers and banks. </p>
<p>The EMV transition costs – and the interchange fee – hint at the problem of information asymmetry – banks and card issuers know more than we do – which allows one party to take advantage of the other. This information asymmetry is typical of the complex and bewildering technical changes that, ironically, characterize the “information age.”</p>
<p>So when you’re at the cash register, about to slip your chip-enabled card into the new reader, think about the costs and benefits of this new technology and ask yourself: is it worth it?</p>
<p><em>This article was corrected to clarify that US EMV cards will be mainly using the “chip and signature” method, as opposed to the more secure chip and PIN method typical in Europe.</em></p><img src="https://counter.theconversation.com/content/48410/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Benjamin Dean does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Today marks a milestone in our transition to more secure electronic payments, yet the costs and benefits are not what they seem.Benjamin Dean, Fellow for Internet Governance and Cyber-security, School of International and Public Affairs, Columbia UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/419452015-05-21T04:33:30Z2015-05-21T04:33:30ZHow to rebalance Africa’s relationship with China<figure><img src="https://images.theconversation.com/files/82422/original/image-20150520-11450-pxgei6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Zimbabwe's President Robert Mugabe with his Chinese counterpart Xi Jinping.</span> <span class="attribution"><span class="source">REUTERS/Diego Azubel/Pool</span></span></figcaption></figure><p>Sub-Saharan Africa’s economic <a href="http://www.brookings.edu/research/papers/2014/04/10-africa-china-foreign-policy-sun">ties with China</a> have grown significantly this century. Beijing became the sub-continent’s biggest trading partner in 2009. But for sub-Saharan Africa to benefit fully from this relationship both parties need to change their behaviour and attitude. </p>
<p>The dramatic rise in trade has been driven by two factors: <a href="http://www.bp.com/content/dam/bp/pdf/Energy-economics/statistical-review-2014/BP-statistical-review-of-world-energy-2014-full-report.pdf">China’s energy needs</a> and Africa’s <a href="http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/AFRICAEXT/0,,contentMDK:21951811%7EpagePK:146736%7EpiPK:146830%7EtheSitePK:258644,00.html">lack of infrastructure</a>. China has found a ready source of energy in Africa while the continent has welcomed investment in much-needed infrastructure projects.</p>
<p>The development of infrastructure will benefit Africa, including, for example, enabling the continent to better <a href="http://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/WPS%20No%20127%20Chinese%20Infrastructure%20Investments%20.pdf">integrate its economies</a>.</p>
<p>But China’s economic relations with sub-Saharan Africa are not without their <a href="http://bricspolicycenter.org/homolog/uploads/trabalhos/6003/doc/106878267.pdf">tensions</a>. These need to be addressed if the sub-continent and China are to strengthen their ties and the relationship is to become more mutually beneficial.</p>
<h2>What are the big challenges</h2>
<p>The over-riding need is for a rebalancing of the relationship between China and sub-Saharan Africa. </p>
<p>A practical example of this is that many Chinese companies import labour from China to work on large projects. This has conveyed the erroneous impression that local people are incapable of doing the work required. It has also been interpreted as a lack of respect. </p>
<p>No economic relationship is ever truly beneficial if there is no <a href="http://www.oecd.org/investment/investmentfordevelopment/1959815.pdf">technology transfer</a> and building of the local capacity. Chinese companies could easily train local workers to the desired level.</p>
<p>A further source of frustration has been evidence that Chinese companies are importing <a href="http://www.thebrenthurstfoundation.org/files/brenthurst_commisioned_reports/Brenthurst-paper-201203-Africa-in-their-Words-A-Study-of-Chinese-Traders.pdf">inferior quality</a> products to African countries. </p>
<p>Chinese manufacturers are capable of producing products to different standards. But there is no reason why a Chinese company should produce a product of low quality for a Nigerian importer and do otherwise for a client in Europe or Australia. </p>
<p>There have been cases of producers showing a higher quality product at the inception of a contract and a down payment. On opening the container, the customer in Africa has discovered a lower quality product was supplied. </p>
<p>It is also possible that African importers are conniving with Chinese producers to exploit consumers. African countries should guard against production and technical faults in imported products and ensure that cheap products are of desirable quality. </p>
<p>Improvement of <a href="http://www.afdb.org/en/news-and-events/article/there-is-strong-commitment-to-customs-modernization-in-africa-kunio-mikuriya-world-customs-organizations-secretary-general-8946/">inadequate customs control </a> would be a good start. </p>
<h2>Reciprocal access</h2>
<p>A noticeable gap in the relationship between China and sub-Saharan Africa is the fact that Chinese entrepreneurs are operating on the continent but the success of African businesses in establishing a presence in China [is minimal](Authors interviews with African entrepreneurs in Shanghai (August, 2010 & May, 2015). </p>
<p>One obstacle is unnecessary bottlenecks in the visa system. Africans can live in China temporarily as students, business people or as English teachers though there is a bias in favour of Caucasians from Europe, Canada or Australia. The [renewal of work permits](Interviews with African entrepreneurs in Shanghai (May, 2015) for Africans that are legitimately in China has improved but more needs to be done. </p>
<p>The <a href="http://www.china.org.cn/living_in_china/abc/2009-07/15/content_18141090.htm">Wholly Foreign-Owned Enterprise</a> initiative is a step in the right direction. This allows foreigners to start a business in mainland China on their own without a Chinese investor.</p>
<p>It allows for a year-long renewable visa for a chief executive officer and four foreign employees. The major <a href="http://www.aabri.com/manuscripts/111061.pdf.">challenge</a> is that it requires a lot of funds from the foreign country and paper work which a start-up entrepreneur may not be able to afford.</p>
<p>African businesses and governments could also take steps to improve access to China. Entrepreneurs should learn more about <a href="http://www.bu.edu/mlcl/home/why-study-chinese/">Chinese culture</a>, including Mandarin and Cantonese.</p>
<p>Embassies should be strengthened with experts who know about China, particularly its economy, competitive advantage and trade. Governments should also publish up-to-date trade information on their websites as stipulated by the World Trade Organization <a href="https://www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm">Trade Facilitation Agreement</a>.</p>
<h2>What Africa needs to do</h2>
<p>There is a great deal that Africa needs to do too. Effective environmental regulations need to be put in place and enforced to ensure that resources are exploited with minimal environmental degradation.</p>
<p>Governments could insist, for example, that timber exporters replace trees they cut down to avoid deforestation and loss of biodiversity.</p>
<p>Africa should also increase its capacity to <a href="https://cmsdata.iucn.org/downloads/china_africa_trading_web.pdf">process products</a> which would create employment. An example would be to start using timber locally instead of <a href="http://www.forest-trends.org/documents/files/doc_2340.pdf">shipping the raw lumber</a>.</p>
<p>As African countries open their markets to China they should also put in place measures to protect their economies. Market price support by guaranteeing prices for certain products could be trade distorting but would be beneficial to certain economies.</p>
<p>Another strategy that could <a href="http://www.csae.ox.ac.uk/conferences/2011-edia/papers/046-Adekunle.pdf">protect local economies</a> is through the design of a mechanism under which gainers, for example traders and exporters, compensate the losers, for example workers, in a transaction.</p>
<p>And markets should be differentiated in such a way that products for export are attractive to the Chinese market while quality is not compromised at home. </p>
<p>African countries should also investigate joining the Chinese- initiated <a href="http://www.aiibank.org/">Asian Infrastructure Investment Bank </a>(AIIB) as non-regional members. Egypt and South Africa are already founding members of AIIB.</p>
<p>Joining the initiative would be in the interests of sub-Saharan African countries. The bank has the potential to transform the development landscape by creating a potential competitor to the World Bank. It will also be another source of technical and financial assistance. </p>
<p><strong>Special thanks to Adedeji Ayodeji Adekunle in Shanghai for providing up-to-date information</strong></p><img src="https://counter.theconversation.com/content/41945/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Bamidele Adekunle does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>For sub-Saharan Africa to benefit fully from its growing economic ties with China both parties need to change their behaviour and attitude.Bamidele Adekunle, Contract Faculty, Ted Rogers School of Management, Ryerson University; SEDRD Adjunct Professor, University of GuelphLicensed as Creative Commons – attribution, no derivatives.