ICERAS

Executive Summary
In this study, we review existing research, both theoretical and empirical, on the impact of
forcibly displaced persons on residents’ livelihoods in host communities in developing countries, with an emphasis on African experiences. An inflow of a large number of refugees represents a large challenge to any host community. This is especially true in developing countries with their limited financial and administrative capacities. Immediately, refugees require
accommodation, housing, and key public services such as health care and education. Sooner
or later, refugees will seek to provide for their own livelihood, look for work in the informal
or formal labor market, and interact economically with the host economy in multiple ways.
When developing countries host refugees, they receive financial and technical support from
the international community. This support typically covers the subsistence needs of refugees and may also finance other host country expenditures related to their presence. We
explain (Sections 2.1 and 2.2) why there is a strong presumption that, with sufficient international financial and technical support, the aggregate impact of refugees on the host community will be at least neutral and maybe even positive. The main insight is that refugees,
equipped with international financial support, provide a stimulus to the local economy
through their demand for locally produced goods and services, which translates into higher
output prices, more demand for local workers, and higher real incomes. This presumption is READMORE