Café Economics: Partnerships for Refugees

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UNHCR’s Filippo Grandi argues that long-term solutions for refugees go beyond humanitarian aid and require strategic partnerships between humanitarians and economists to support millions of forcibly displaced people and foster economic recovery.
Interview conducted by Bruce Edwards for F&D Magazine; based on a podcast from March 23, 2023. The interview has been edited for length and clarity.

Key figures:
- Ten years ago, the global population of forcibly displaced people, including refugees, was about 40 million.
- It’s now 103 million and rising.
Primary drivers:
- Multiplication of conflicts as the largest driver of population displacement.
- Other contributing drivers: economic factors, inequalities, demographics, and climate change.
Feedback effects:
- Displacement can negatively impact nature (deforestation, depletion of water resources), which can further exacerbate tensions and displacement.

Mandate focus:
- Protect and find solutions for refugees—people fleeing violence, war, or persecution.
- Increasing assistance to internally displaced people (those fleeing within their own country).
Operational footprint and funding:
- Works in 137 countries and has a workforce of about 20,000 people.
- Yearly expenditure of about $6 billion in the last couple of years, almost entirely voluntarily funded.
- Faces funding shortfalls given rising needs and high competition for resources.
Strategic shift:
- Move from purely humanitarian responses toward partnerships with development actors to meet medium- and longer-term needs (education, proper health care, livelihoods).

United Nations compacts:
- In 2018, the United Nations established two compacts: one on refugees and one on safe and orderly migration. UNHCR is custodian of the compact on refugees.
- The compact proposes that especially in large refugee situations, responses should extend beyond humanitarian aid to include medium- and long-term measures.
World Bank cooperation:
- World Bank established financial instruments within its International Development Association platform for low-income and, separately, for middle-income countries to help host large numbers of refugees.
- Purpose: work in parallel to improve inclusion of refugees in education and health systems, livelihoods, economic opportunities, and support to host communities.
Broader partnerships:
- Work with bilateral development agencies and regional banks.
- IMF engagement is growing; UNHCR has a staff member on loan to advise the IMF on issues related to forced displacement.
Policy implication:
- A concerted effort with development and financial institutions can enable medium- and long-term integration of refugees and unlock economic benefits.

Three factors increasing UNHCR vulnerability to economic trends:
- Inflation increases operational costs, especially for expensive security-logistical operations in places like Afghanistan and northwest Syria.
- Humanitarian aid growth has not matched the growth of needs.
- Greater economic pressures and risks make displaced populations and host communities more fragile and in need of assistance.
Macroeconomic impact:
- High numbers of refugees can have a macroeconomic impact on host countries.
- UNHCR urges the IMF to factor displacement into its work in refugee host countries and to support the case that integrating refugees brings large economic benefits.

Operational constraints:
- Operating in territories controlled by entities not recognized by the international community (example: Afghanistan) or in countries under sanctions complicates work.
- UNHCR’s stance: presence is necessary to help people regardless of international politics; engagement with all entities and governments is sometimes required.
Mechanisms:
- Appropriate exemptions to sanctions can allow receipt of sufficient resources to run indispensable humanitarian operations (example cited: Afghanistan).

Expand partnerships beyond humanitarian actors to include development organizations, World Bank, bilateral agencies, regional banks, and financial institutions like the IMF.
Prioritize medium- and long-term needs of displaced populations: education, proper health care, livelihoods, economic inclusion.
IMF and other financial institutions should factor forced displacement into their country work in host countries to reflect macroeconomic impacts and potential benefits of integration.
Use legal and financial mechanisms (for example, sanctions exemptions where applicable) to ensure delivery of indispensable humanitarian operations in complex environments.

Source: Café Economics: Partnerships for Refugees, F&D Magazine, June 2023. Interview based on a podcast from March 23, 2023.

Cafe Economics: Partnerships for Refugees
- Cafe Economics: Partnerships for Refugees (Markdown version)
- Cafe Economics: Partnerships for Refugees (PDF)