France's Codevelopment Program: Financial and Fiscal Incentives to Promote Diaspora Entrepreneurship and Transfers

Abstract:     
One of Europe's longest-standing conceptualizations of the migration-and-development-nexus, France's co-development program associates the French government to a migrant diaspora's transnational engagements in view to reduce migratory pressure. According to this partnership paradigm, France co-funds remittances, skills and knowledge transfers in view to stimulate source country development. This article explains the multi-level structure of co-development policy and traces its complex trajectory over time and space from a financial to a fiscal instrument. Facing diaspora criticism, co-development's migration control and security policy rationales were replaced by strategies to help source countries adjust to a globalizing economy. This article focuses on how France invests into de-fiscalizing migrants' revenue and what effects this shift from financial to fiscal measures may have on migratory flows. We identify five benefits of the tax break: non-discriminatory application in terms of nationality, engaging the financial sector in migration policy formulation, lowering government expenditure, promoting the bancarization of savings and enhancing migrants' trust in the use of savings. While the final verdict on co-development tax breaks for revenue-collection is still outstanding, France's migration-fiscal policy nexus may be an experiment worth replicating on a more global scale.

Keywords: Migration, diaspora, defiscalization, bancarization, codevelopment, tax

Accepted Paper Series