Amid escalating diplomatic tensions with Kuwait, the Philippine President Rodrigo Duterte has called on all Filipino workers in the Gulf country to return home.

His self-described “Solomonic” announcement, which shocked many at home and abroad, came shortly after Kuwait expelled the Philippine Ambassador Renato Villa and recalled its envoy to Manila Musaed Saleh Ahmad Althwaikh.

Diplomatic tensions between the two countries spiked in February when the body of a murdered Filipina domestic worker, Joanna Demafelis, was discovered in a freezer in Kuwait. Her employers, a Lebanese and a Syrian, were subsequently sentenced to death in absentia and are currently held in Lebanon and Syria respectively. In 2016 and 2017, as many as 185 Filipinos working in Kuwait died, some under suspicious circumstances.

In the aftermath of the outrage that the murder caused at home, the Duterte government scrambled to take action to reassure the Filipino public. Hoping to score some publicity points at home, some officials in the Department of Foreign Affairs posted videos of what it claimed were “rescues of our distressed kababayans [fellow Filipinos]” by Philippine diplomatic personnel in Kuwait.

In response, the Kuwaiti authorities accused the Philippine embassy personnel of “smuggling Filipino maids in flagrant violation of Kuwait’s laws and international diplomatic rules”. They immediately detained several non-diplomatic staff from the Philippine embassy, while issuing arrest warrants for three Filipino diplomats.

After decades of cordial relations, the two nations have moved dangerously close to severing their diplomatic ties and the fate of more than 260,000 Filipinos residing in Kuwait is now hanging in the balance. The ongoing diplomatic crisis, however, is only the tip of the iceberg.

It exposes a more fundamental challenge for the Philippines, which has exported labour for decades to fuel its economy. The policy is proving increasingly unsustainable, since it exposes countless Filipinos to difficult and highly dangerous working conditions abroad while the demand for labour is rising at home, along with the standard of living.

The export of unemployment

Up until the 1960s, the Philippines was one of the world’s fastest-growing economies. At that time, the country boasted Southeast Asia’s most modern infrastructure, world-class universities, a buoyant cinema industry and a burgeoning middle class, which stood at the forefront of fashion and culture in the region.

In recognition of the Philippines’ bright economic prospects, Japan decided to set up the Asian Development Bank’s headquarters in Manila in 1966. Back then, the Philippines was seen as the emerging manufacturing and consumer powerhouse in the East, akin to how China is viewed today.

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Yet, the following decade saw the Philippines gradually fall into a downward spiral of economic stagnation (PDF) under the repressive Ferdinand Marcos regime. An initial growth spurt in the early 1970s quickly gave way to ballooning debt and chronic corruption, which doomed the Philippine economy for decades to come.

By the early 1980s, the Philippines was essentially bankrupt, with the World Bank and the International Monetary Fund bailing out what was then seen as the “sick man of Asia”.

It was during the period of the Marcos dictatorship and deteriorating economic conditions are home that the Philippines began to send large numbers of its citizens abroad.

The trigger was the oil crisis of the early 1970s, which hammered oil-importing nations such as the Philippines but created a construction boom across the Middle East where labour was in shortage. Manila essentially exported its unemployment problems.

Labour policies and shortages in the Philippines

But what began as a stopgap measure under the Marcos regime turned into an official pillar of Philippine foreign policy under succeeding administrations.

Over the following decades, as much as 10 percent of the Filipino households had a member working overseas. In fact, one of the three major goals of the country’s foreign policy is the protection of the welfare of Filipino migrant workers, which have been an indispensable source of capital to the country’s economy.

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In 2017, the overseas Filipino workers remitted up to $33bn (close to 10 percent of GDP) back home. Due to their sacrifices and contributions to the Philippine economy, they are commonly referred to as “modern heroes“ (Bagong Bayani) in the country. Yet, their economic contributions have come at an immeasurable social cost.

The labour export policy has affected hundreds of thousands of nuclear families, as either one or both parents have left their children back home. There is also the broader culture of dependency, with many Filipinos opting to rely on remittances from abroad as a source of livelihood.

Deploying a large number of Filipino women – or the feminisation of Philippine labour export – to places with minimal to non-existent safeguards and protection for minority workers has exposed them to rampant abuse.

But as the Philippine economy enters a “golden age” of growth, there are hopes that many Filipinos can return home. In fact, amid a massive $180bn infrastructure build-up, the Philippines is, for the first time in recent history, running short on construction workers.

With the Philippines again becoming one of the world’s fastest-growing economies, employers are now willing to provide better wages and conditions for local workers. Thus, low-paying and unsafe jobs abroad are beginning to look less appealing to the rising middle class in the country.

For now, however, the Duterte administration is hopelessly scrambling for ways to protect its citizens in Kuwait and across the Middle East, which hosts as many as two million Filipino workers. It’s an uphill struggle, which will test any government’s resolve.

The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.