Kenya to bag Sh286b from the diaspora
Kenya’s diaspora remittances are expected to hit a new high of Sh285.5 billion this year, but growth will be at the slowest pace since 2015, World Bank data shows.
The rate of growth of remittance inflows will rise by just five per cent compared to a 39 per cent growth between 2017 and 2018.
Kenya’s remittances are up by Sh13.6 billion year-to-date compared to 2018.
The lower rate of growth is a reflection of mounting economic concerns in the US and UK where analysts say a recession is on the horizon despite strong employment data in the US.
Kenya is the fourth largest recipient of remittances in Africa after Egypt, Nigeria and Ghana.
Remittances are now the biggest source of foreign exchange, ahead of tourism, tea, coffee and horticulture exports.
Most of the remittances come from the US and Britain. Uganda is the third biggest source of remittances to Kenya, ahead of Tanzania, Canada and Australia, with an estimated Sh19 billion flowing into the country in 2018 from Uganda.
Kenya, however, is one of the countries that are least dependent on remittances since they only account for three per cent of the gross domestic product (GDP).
Remittances account for up to six and 15 per cent of Nigeria’s and Lesotho’s GDP respectively. Egypt and Nigeria received Sh2.6 trillion and Sh2.5 trillion from remittance inflows respectively.
Kenya has an estimated diaspora population of 1.08 million but the number could be as high as three million due to a high population of undocumented migrants working, especially in informal labour.
The World Bank report, however, does not capture the inflows from sources such as Saudi Arabia, UAE and other Middle East countries where many semi-skilled Kenyans are domiciled.
China remains one of the lowest sources of remittances for Kenya despite its rising economic influence mainly due to strict immigration and employment policies.