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By Ana Cristina Sierra, UNHCR Associate Economist; Catalina Obando, UNHCR Economic and Financial Inclusion Assistant; Daniel Gomez Amaya, World Bank Group Social Inclusion Consultant; and Renzo Morales Miraval, IFC-UNHCR Joint Initiative Consultant

In February 2022, Andrés from Venezuela received his Temporary Protection Permit in Bogotá. With the document in his hands, he said: “I work alone using my motorcycle. I would like to register it under my name, to certify my business, and to have a bank account.” © UNHCR/Daniela Camargo

Colombia has welcomed over 2.8 million Venezuelan refugees and migrants, implementing comprehensive measures that have not only provided Venezuelans with legal status and access to essential services, but also facilitated their entry into the labour market through temporary work permits and job facilitation. These integration efforts include the Permiso Especial de Permanencia (PEP) from 2017 to 2021, the Permiso Especial de Permanencia para el Fomento a la Formalización (PEPFF) from 2020 to 2021, and the current, broader Estatuto Temporal de Proteccion para Venezolanos (ETPV) which provides legal status for ten years.

In the context of large-scale refugee arrivals in Colombia and unprecedented human mobility throughout the region, the PEPFF programme shines as a modality of public-private collaboration in refugee and migration policy. The programme has been instrumental in promoting economic and social inclusion, filling critical workforce gaps, and enhancing workplace cohesion and productivity.

The PEPFF offered temporary work permits to Venezuelan refugees and migrants, with employers responsible for handling the applications on behalf of their potential employees. Of the 23,193 applicants, 19,106 (82%) were approved and received temporary regular status.

By issuing temporary work permits, the PEPFF granted employment-based regularized status for Venezuelan participants while addressing workforce shortages, benefiting both participants and firms. Participants saw significant wage increases, with earnings nearly doubling for many, and also experienced better job quality, moving into roles better suited to their skills. From the firms’ perspectives, 85% reported improved performance and team cohesion, noting that their Venezuelan employees were competent and quick learners. This policy note on the PEPFF provides more information.

The PEPFF underlines the crucial role of regularization programmes in the broader response to forced displacement. The programme’s focus on small scale firms (90% were micro or small businesses) offered advantages, as these firms typically have closer ties with the community and the local labour market.

However, evaluation of the PEPFF highlights the ongoing challenges such as regulatory barriers, credential recognition, and workplace discrimination that many refugees and migrants face, despite their skills and willingness to work.

Just 34% of PEPFF programme participants were women, highlighting a clear need for targeted support. By tailoring support for women, we can boost their economic independence, facilitate their integration into host communities, and promote gender equality.

The reported lack of clarity in the application process, particularly prevalent among firms not succeeding in hiring through PEPFF, highlights the necessity of streamlining programme procedures. Major challenges include complex and technical language, faulty government webpages, and difficulties monitoring the application process. Our evaluation indicates that simplifying procedures and clarifying guidelines would reduce administrative burdens, improving participation and better employment outcomes for refugees.

Inclusive initiatives like PEPFF show how effective policies can transform lives and strengthen societies. Effectively integrating refugees and migrants in the labour market boosts productivity, increases the availability of skilled workers, and drives economic growth. These benefits are even more pronounced when refugees and migrants can formally work in roles matching their qualifications. Therefore, it is crucial to implement labour market programmes that maximize the contributions of refugees and migrants to the workforce.

The Social Cohesion and Forced Displacement Report by the World Bank and UNHCR (2022) indicates that Venezuelan migration could boost Colombia’s average annual growth rate by 0.7–0.9 percentage points in the medium to long term, mostly through the impact on the labour force. Achieving this, requires collaboration between the government, private sector, and NGOs, as evident through the experiences of the EPTV and the PEPFF.

Private companies, business associations and philanthropies are essential for inclusion efforts, offering vital products, services and employment. They drive socio-economic inclusion through inclusive practices and collaborating with public authorities to adapt public policies. Moreover, there’s a strong business case for the private sector to operate in forced displacement contexts. Companies can tap into new revenue streams by providing products and services to displaced individuals and can alleviate labour shortages and reduce employee turnover rates by employing refugees. Additionally, partnering with migrant-led businesses, incorporating them into supply chains, offering skills training, and connecting with host communities are crucial steps in promoting inclusion and supporting economic development.

Support from multilateral institutions, such as the International Finance Corporation (IFC), further strengthens the private sector’s capacity to include marginalized communities, including refugees and migrants. Across Latin America, IFC has supported initiatives in Colombia, Brazil, Peru, and others that have provided financial services and loans to thousands of Venezuelan refugees and migrants, fostering their social and economic integration. In Colombia, an IFC-supported pilot by Bancamía, a microfinance bank, has since 2021 provided loans to 5,300 Venezuelans, half of them women.

UNHCR, alongside the Colombian government and international partners, is dedicated to empowering communities and integrating victims of forced displacement. Our efforts are focused on helping refugees regularize their status and providing support through employability programmes, entrepreneurship training, vocational courses, financial inclusion initiatives, and educational opportunities.

Working with partners like the IFC has given UNHCR insight into the private sector’s goals and motivations for supporting migrants and refugees. It has also helped the IFC understand the challenges these populations face, their needs for products and services, their job skills, and the enabling environment required for integration.

From the IFC, Anna Sabino, Associate Operations Officer, Carola Krainz, Associate Operations Officer, and Patricio Puga, Senior Operations Officer, also contributed to this post.