Improve Diaspora Facilitation To Promote Their Participation In Economic Development, Committee Tells Cs National Treasury
Treasury CS Prof Njuguna Ndung’u when he appeared in Parliament yesterday
By Our Reporter
Worth Noting:
- “The Kenya Kwanza administration has created a new State Department of Diaspora Affairs. Previously, there was only a unit within the Ministry of Foreign Affairs dealing with diaspora issues. Going forward, it would be advisable that the government, especially the State Department of Diaspora Affairs, engages the diaspora community through their associations”, he noted.
- Njuguna told the legislators that the Ministry had developed wide ranging bankıng and financial sector reforms to help lower the cost of money transfer. He held that the transformation of the payments ecosystem had been a game changer in enabling Kenyans to send money home.
The Committee on Diaspora Affairs and Migrant Workers has called on the Government to improve facilitation to the Diaspora community to promote their participation in the economic development of the country.
Speaking when they met the Cabinet Secretary National Treasury Prof. Njuguna Ndung’u, the members noted that there is need to create incentives to attract Kenyans living in the Diaspora to invest in the country along other foreign investors that the government is inviting to do the same.
Members cited a number of constraints that the Community faces in their bid to invest locally ranging from lack of information on investment opportunities and government policies, to difficulties in money transfer.
Others are lack of safeguards that guarantee their investments, and harassment by customs officials at the airport.
On his part, Prof. Njuguna informed the committee that his Ministry had put in place policies and programs to attract diaspora remittances over the years. The legislators had called on the National Treasury to facilitate the diaspora community to improve the goal of their remittances.
He emphasized on the Government’s commitment to engage the diaspora and incorporate them in national development.
“The Kenya Kwanza administration has created a new State Department of Diaspora Affairs. Previously, there was only a unit within the Ministry of Foreign Affairs dealing with diaspora issues. Going forward, it would be advisable that the government, especially the State Department of Diaspora Affairs, engages the diaspora community through their associations”, he noted.
Prof. Njuguna told the legislators that the Ministry had developed wide ranging bankıng and financial sector reforms to help lower the cost of money transfer. He held that the transformation of the payments ecosystem had been a game changer in enabling Kenyans to send money home.
He cited the M-Pesa service beyond Kenya’s borders and the partnership between the Diaspora Association and banks to allow them to handle larger volumes of inflows at lower costs and within a much shorter time frame.
He revealed that as a result, remittance inflows to Kenya had increased significantly over the past decade reaching a record of KSh500 Billion in 2022.
According to the documents he tabled before the committee, the US remains the largest source of remittances into Kenya accounting for 58 percent.
Remittances are an important source of foreign exchange to the country. The inflows have a positive impact on the livelihoods of vulnerable households.
During the session chaired by the Committee Vice Chair Simon King’ara from Ruiru constituency, the CS disclosed that the Central Bank conducted Kenya’s first Diaspora Remittances Survey between 19th March and 17th May 2021 to collect valuable information to improve quality of remittance statistics.
He further revealed that the Central Bank had developed a range of financial products targeting the diaspora including successful infrastructure bonds.
The MPs however noted the need to expand focus beyond Kenyans living in the United States to allow more Kenyans living elsewhere across the globe to benefit from the facilitation already in place for the diaspora.
With regard to policies and measures in place to harness the investment of diaspora remittance inflows, Prof. Njuguna told the Committee that in a bid to mainstream the community into the National Development Process, the government had formulated the Kenya Diaspora Policy in 2014.
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