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Muhammad Rafique can't deny his hopes have been boosted by the Malaysia deal, but tears well up in his eyes as he explains that 15 years as a refugee have taught him not to be so foolish as to trust such feelings.

On the walls inside the squalid shack where he lives with his wife and young child are a map of Burma and a poster of the Universal Declaration of Human Rights.

The 34-year-old, an ethnic Rohingya who arrived in Malaysia from Burma when he was 19, is desperate to know whether he and his family might be among the 4000 refugees that will be resettled in Australia.

Under the deal signed in Kuala Lumpur on Monday, Australia will resettle 1000 bona-fide refugees a year over four years, in exchange for Malaysia taking the next 800 asylum seekers that arrive in Australia by boat.

But Rafique and his family are just three among more than 90,000 refugees in Malaysia.

"I want to go to Australia with my family. I hope to have a chance to go to Australia," he said.

It's obvious when he speaks that he sees their chances as bleak.

His English is poor and, having been a refugee for his entire adult life, Rafique has no skills.

He believes his chances are even poorer because the United Nations High Commissioner for Refugees (UNHCR), which will have input into who makes it into the 4000, "doesn't like to send Muslim people to Australia".

"I am worried the UNHCR don't want to pick me and my family. I fear the UNHCR will not want to listen to me."

Unlike the 800 asylum seekers that will be transferred from Australia, Rafique has no rights to work or access to education.

He has little access to health care, and like many of the refugees waiting in a long queue in Malaysia, Rafique suffers from anxiety and depression brought on by the parlous life he and his family live, and their uncertain future.

A study by the non-government organisation, Health Equity and Initiatives (HEI), in March this year found that 70 per cent of asylum seekers and refugees in Malaysia suffered symptoms of anxiety, depression and stress as a result of human trafficking, forced labour and unemployment.

Xavier Pereira, the director of HEI, said the figure was three times higher than in any normal population.

"Both men and women are equally affected, especially those who are unemployed, involved in human trafficking and forced labour," he said.

The level of anxiety was much higher among those who were yet to be granted refugee status, according to the study of 1074 asylum seekers and refugees, aged between 18 to 70 years.

Rafique has been ripped off by agents that have promised to help with resettlement in another country, and he admits to having paid a people smuggler in a failed attempt to make it to Australia on a boat.

He cannot return to Burma, according to Amnesty International, because as he is from the Rohingya minority, the Burmese authorities would refuse to grant him citizenship, rendering him stateless.

In Burma, he would suffer from systematic persecution, including forced labour, forced eviction, land confiscation, and severe restrictions on freedom of movement.

He says he will now do the right thing and wait, and hope for a chance of resettlement in Australia.

But he says others will still pay people smugglers and get on the boats in a perilous crossing to Australia, despite the deal with Malaysia meaning that within 72 hours, they will be sent back.

"They will still go, whatever chance they have, they must try to go, even if it means they go to the back of the queue," Rafique said.

Karlis Salna, AAP South-East Asia Correspondent

Bangladesh: Myanmar refugees weave together self-reliance and hope

FARUK PARA, Bangladesh, (UNHCR) Kil Cer, a shy, petite 34-year Chin refugee from Myanmar, can be found every morning weaving blankets along with five other women in the village community centre in this remote lush green village in the Chittagong Hill Tracts.

But they're not just turning out the colourful traditional blankets their mothers and grandmothers have always made. In their own quiet way they've woven together a small-scale economic revolution in the settlement of 700, liberating their families from debt and dependence on handouts.

"I am happy now," says Kil Cer. "Before, it was a difficult struggle." Largely because of Kil Cer's weaving skills, her community has paid back all their debts. They are able to take care of their families without UNHCR's support and have invested money in other businesses, such as banana plantations, that also employ the local Bangladeshi host community, known as the Bawm.

"We speak almost the same language as they do and they have been very good to us," Kil Cer, a mother of two, says about her hosts.

Behind the success is a new UNHCR approach to developing self-reliance as part of UN High Commissioner for Refugees António Guterres's focus on refugees living outside camps. Learning from earlier projects that gave grants to refugees who did not have the proper skills or business education to use the money properly, UNHCR began relying on the expertise of local businesses to develop the skills of refugees in Bangladesh living outside camps.

Eight months ago, Kil Cer and other refugees in the village were heavily in debt after many of their projects small rice mills, grocery shops and farming failed. For many years, they had relied on UNHCR to pay their rent and give them money for basic commodities. Even when Kil Cer tried to support herself with weaving, she was only able to earn US$2 per blanket hardly enough to cover her expenses.

"Like many girls in Myanmar, I was taught to weave by my mother in Myanmar when I was 15 years old," she says. In Bangladesh, she began weaving blankets and passed on the skill to a few other young women, both refugees and Bangladeshis.

The turning point came when UNHCR introduced her to Samantha Morshed, chief executive officer of Hathay Bunano, a company that was already employing rural Bangladeshi women and other disadvantaged people to make soft toys for the international market under fair trade rules. She provided free professional advice to Kil Cer and her team on improving their products and marketing them, to make best use of a UNHCR start-up loan of US$250.

Today their offerings include shawls, scarves, ponchos, baby blankets, picnic blankets, bedspreads and bags marketed under Expression in Exile, a brand that is becoming popular with the urban elite in the Bangladeshi capital, Dhaka. Within a month, they made a profit of US$800, a substantial amount for the residents of Farak Pura, and today demand is outstripping supply.

"I was excited when I first saw the blankets from Expression in Exile and am happy to give the group a little direction in terms of colours, sizes, pricing and raw materials," says Morshed. "I see no reason why these blankets cannot achieve mainstream export sales in the near future."

Now that her daily needs are taken care of, Kil Cer is already looking to a future she could scarcely have dreamed of a year ago. "I want to invest the money in my children's education," she says. Her 19-year-old colleague, Siang Khin Par, has similar high hopes: "I do this because I would like to be self-reliant. I would like to learn computing and English."

UNHCR Representative in Bangladesh Saber Azam says the programme is paying benefits not only for the refugees but for Bangladesh as well.

"Ensuring that refugees are able to take care of themselves and their communities is often a more humanitarian activity than giving them free hand-outs for years," he says. "Kil Cer has also demonstrated how refugees can help their Bangladeshi hosts rather than being a burden on them."

By Jelvas Musau in Faruk Para and Arjun Jain in Dhaka, Bangladesh

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