VENTURES AFRICA – Kenya’s Diaspora remittances has hit an average of 7.5 billion shillings ($89 million) every month making it a key source of foreign exchange alongside tea, horticulture and tourism.
Data from the Central Bank of Kenya (CBK) indicates that diaspora remittances hit about 50 billion shillings ($596 million) in the first six months of 2012 up from 34.14 billion shillings ($406. million) sent in a similar period in 2011 .This marks a 47 percent rise in the first six months of 2012.
This rise has been attributed to government efforts in encouraging Kenyans living in the Diaspora to invest in government securities.
Last week President Mwai Kibaki presided over the opening of the Kenya Diaspora Conference 2012, at the Church House Confrence Centre, in London where he encouraged the Diaspora community and foreign investors to make investments in Kenya.
Real estate and property development has also become popular investment for Kenyans in the Diaspora due to its high return margins.
Remittance inflows to Kenya have been on the rise since 2010 despite the volatile economic environment in the US and Europe. In 2011, Kenya received $891 million in remittances .remittances.
The Kenyan Diaspora is believed to be about three million with an estimated 400,000 to one million population living and working in the US.
Remittance inflows for the last three months have been fluctuating with the CBK attributing this to seasonality.
For instance, in the month of June, inflows dropped to 8.46 billion shillings ($99.5 million) compared to 8. 57 billion shillings ($101 million) realised in May. The CBK attributed this to lower inflows from the US.
Remittances from Europe for the month of June increased by six per cent to 2.5 billion shillings ($29.81 million) from 2.4 billion shillings ($28.13 million) recorded in May accounting for 30 percent of total remittances for the month.
According to a Stanbic Investment Management Services a report, diaspora remittances have contributed more than $3 billion to the Kenyan economy in the last 5 years.
Image via mwakilishi