Steve Geoffrey, one of approximately 30 million foreigners living in the Middle Eastconsiders himself lucky to be able to continue supporting his family in Kenya.
This 38-year-old man, who works for a hotel company in Doha, the capital of Qatar, sends about 150,000 shillings (US$1,159) a month to his wife and two children. This represents almost double the average salary in Kenya, allowing the family to cover his younger brother’s school fees and other unforeseen expenses. “We continue to pray and hope for the best,” Geoffrey said, referring to the more than three-month war, during which cities across the Gulf were attacked with Iranian missiles and drones. “Coming home hasn’t even crossed my mind. I wouldn’t know where to start.”
The conflict has highlighted one of the world’s largest migration corridors, putting thousands of people at risk. millions of dollars in remittances and testing an economic model that relies on foreign workers to keep Gulf economies running. While nearly all Iranian attacks were intercepted, the war disrupted travel and tourism, hampered exports through the Strait of Hormuz, raised import costs and tested supply chains. Some countries implemented measures to help their residents cope with the crisis, such as deferring loans, but job insecurity increased in all sectors, from hospitality to construction.
Although the United States and Iran hold talks aimed to reach a permanent peace agreement within 60 dayseconomists expect growth in the region’s major economies to slow this year. Migrant workers from the six Gulf Cooperation Council countries sent home some US$124 billion in 2024, supporting families from Asia and the Middle East in Africa. Their concerns are already reflected in the data: Western Union Co. reported an increase in remittances sent from the Middle East during the initial phase of the conflict.
In India, where the United Arab Emirates represents at least a fifth of remittances received, money sent home by overseas workers rose more than 28% in the three months to March. Bangladesh and Sri Lanka also recorded increases. The growing uncertainty stemming from the conflict “could have led to a surge in remittances as expatriates rushed to repatriate funds to India for security and liquidity reasons,” said Madhavi Arora, an economist at Emkay Global Services Ltd. That initial rush was not uniform across countries. In the Philippines, remittances grew at their slowest pace in nearly four years in April, a worrying sign for a country where such remittances account for about 10% of GDP and where nearly 2.4 million citizens work in the Middle East.
Data from the Central Bank of Kenya shows that private transfers from the Gulf states increased in March, as some 500,000 workers rushed to send money to their families at the beginning of the war, before falling 18% in April. “There are clear signs of financial difficulties,” said Daré Okoudjou, CEO of cross-border payments platform Onafriq. While the volume of transactions has increased, their average value has decreased by about 12%, he explained, and delays in salary payments are forcing some workers to dip into their savings. “For the first time since the 2020 pandemic, it is estimated that 40% of senders are drawing on their emergency reserves to maintain remittance levels,” he stated.
“This response capacity is fragile, since once these savings are exhausted – which is estimated for the third quarter of 2026, if the conflict persists – we foresee a sharp collapse in the total volume.” More than 50 years ago, the Persian Gulf became a magnet for migrant workers when booming oil sales boosted government revenue and triggered large-scale investment in infrastructure. Coupled with the relative shortage of domestic labor, this created a steady demand for foreign workers that has continued as regional economies expanded and private sectors matured.
More recently, nations with abundant economic resources have undertaken ambitious diversification plans, seeking to build national ecosystems in finance, technology, healthcare and, increasingly, artificial intelligence. This has been largely driven by immigration. Foreign workers built much of the Gulf’s modern infrastructure and still account for the majority of private sector employment in several Gulf Cooperation Council (GCC) states. The conflict is exposing vulnerabilities that existed long before the war. Most Gulf States They offer limited pathways to permanent residency or citizenship, while many low-wage workers have little access to unemployment benefits or social benefits if they lose their jobs.
Barely a month after the start of the conflict, Human Rights Watch reported that some workers They were struggling to cover their daily expenses due to loss of income, rising costs, and limited access to social services and assistance programs. The organization urged Gulf governments to protect migrant workers from loss of income, compensate affected workers and ensure that employers meet their contractual obligations despite the conflict. “A decrease in remittances or any type of risk associated with them would immediately translate into economic and social difficulties,” said Dilip Ratha, CEO of the consulting firm Ratha Global.
Higher oil prices have historically driven hiring and wage growth in the Gulf region. However, this time, the war-related increase is due to the interruption of production, damage to infrastructure and the blockage of trade routes, limiting benefits for workers, according to a World Bank report. Gulf governments are expected to increase investment in reconstruction, logistics networks and infrastructure projects designed to expand oil export capacity and gas to avoid the Strait of Hormuz. This could help stabilize labor markets.
However, according to the International Labor Organization (ILO), migrants often suffer disproportionately from the consequences of labor market adjustment, such as layoffs, reductions in working hours, loss of income or restrictions on mobility. Based on historical crisis patterns in the countries of the Gulf Cooperation Council (GCC), the ILO indicates that migrant employment decreases by 4% for every 1% decrease in employment among nationals. Globally, migrants have sent more than $5 trillion to low- and middle-income countries over the past decade, according to the United Nations agency IFAD. For many developing economies, remittances boost consumption, stabilize exchange rates, finance imports, and alleviate external financial pressures.
Any disruption would have repercussions far beyond public finances, especially as major donor countries turn inward and inflationary pressures rise. Remittances to low- and middle-income countries already exceed foreign direct investment and official development assistance. Unlike other forms of capital, remittances reach homes directly, helping to cover basic needs and, in many cases, transforming lives. A decade-long study found that families receiving remittances in rural Thailand and Vietnam were more likely to purchase flushing toilets, improving sanitation and reducing the risk of stunting, wasting, and underweight in children.
The smaller, poorer and more fragile a country is, the more vital remittances become to its economy.
Remittances are increasingly important to developing countries in Africa, Asia and Latin America, said Ratha, who spent more than 30 years studying remittances, migration and diaspora financing at the World Bank. “The smaller, poorer and more fragile a country is, the more vital remittances become to its economy.”
Not all risks are immediate.
“Historically, we’ve seen similar patterns that then reverse if the conflict drags on for some time: When there is less migration into the region, there are fewer economic opportunities for people, and therefore the overall volume of outbound remittances starts to decline,” Western Union CEO Devin McGranahan said on an earnings conference call in late April. South Asia illustrates the magnitude of vulnerability. The region is home to about 9 million Gulf workers, of whom about 90% are low-skilled workers and generally earn less than migrants from other regions, according to Patrick Kirby, senior economist at the World Bank.
“This means they have the least financial capacity to absorb a loss of income, and their families back home have the smallest savings.” Satheesh Rajan, an Indian swimming coach in Qatar, epitomizes both the opportunities that migrant labor can create and the uncertainty that a new outbreak of conflict could bring. “My big dream was always to build a house that was fully paid for and after years of hard work, I achieved it,” Rajan said, adding that he sends home about 30 thousand rupees (US$318) every month.
While welcoming the peace talks, Rajan said: “We never expected this ordeal to last so long, and beneath the relief, a constant nervousness lingers.” —