The role of remittance and return migrants on urban growth and rural urban linkage: The case of hosanna

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Addis Ababauniversity


The objective of this study is to understand the remittance and returnees’ impact for growth and rural urban linkage together with the aim of identifying the pattern and magnitude of remittance. This study was conducted in Hosanna using methodological triangulation to collect primary data. In this regard respondents for Survey questionnaire (40 remitted 30 returnees and 90 non-migrants), FGD and In-Depth Interview were selected using a mix of purposive, snowball and stratified multistage cluster sampling techniques. The study finding underlined that large amount of remittance is being injected in the economy of the town and the surrounding areas. The inflow remittance has been increasing as more and more people emigrate to RSA. Although, flow pattern exhibits unevenness across seasons (months) of a year, the annual figure confirmed a rapid increase of remittance both in terms of the magnitude and pattern of flow. Concerning the flow channel, the study highlighted the existence of informality where remittance from RSA most often reaches Ethiopia through pocket of travelers. Regarding the impact of remittance and return migrants, this study indicated remittance and return migrants positively contributed for increase in both investment and consumption in general. Specifically the impact on housing construction, transportation sector and labour supply are positively affected by remittance and returnees activities. On the contrary, the impact on price of products (inflated prices), inequality and dependence get worse due to introduction of remittance and return migrants in to Hosanna’s economy. Regarding human capital formation, the health impact of remittance and returnees activity found to be positive while the impact on education is remain inconclusive. This is because although remittance induced family migration and hence better education improved at primary education levels. Less positive side of story comes as remittance induced further migration of youngsters by giving less incentive to continue their education above secondary level. More importantly remittance and returnees activities have very clear impact on Hosanna’s sprawl. The study indicated that the increased income from remittance and return migrants increased demand for consumption and investment, addressing this need in Hosanna obviously presumes creating and/or strengthening linkages between the town and the hinterland. On the other hand, remittance and return migrants activity, and the asphalt road were the two main reasons for the dynamism of the town



Rural urban linkage