INCREASE

Diaspora inflows hit four-month high of Sh32bn in April

Kenya is targeting Sh700 billion in diaspora remittances annually

In Summary
  • The increase that is attributed to increased business activities globally as the world slowly recovers from social-economic holdbacks of Covid-19
  • The amount sent in April was $3 million shy of breaking the all-time record of $299.6 million recorded in December last year.
CBK Headquarters
CBK Headquarters
Image: FILE

Kenyans working and living abroad money sent home $299.3 million (Sh32 billion) in April, a four-month high marking a 43.7 per cent increase compared to $208.2 million over the same period last year.

The increase is attributed to increased business activities globally as the world slowly recovers from the social-economic impact of Covid-19.

It saw the cumulative inflows in the 12 months hit $3.3 billion compared to $2.8 billion in the same period last year, an 18.1 per cent increase.

Inflows in April were 2.8 per cent higher compared to remittances in March, with the US accounting for 57.2 per cent of total remittances sent during the month.

The amount sent in April was $3 million shy of breaking the all-time record of $299.6 million recorded in December last year.

The other top source countries were: UK (11.2 per cent), Saudi Arabia (four per cent), Canada (2.9 per cent), and Australia (2.9 per cent).

Diaspora remittances now leads as Kenya's top forex earner after agricultural exports and tourism revenues suffered the effects of Covid-19. 

The growth in diaspora remittances marginally increased the country's forex reserve which remained adequate at $7.59 billion or  4.64 months of import cover as of May 13 compared to Sh7.575 billion the previous week. 

''This meets the CBK’s statutory requirement to endeavour to maintain at least four months of import cover, and the EAC region’s convergence criteria of 4.5 months of import cover,'' the banking regulator said in the latest weekly bulletin. 

This further stabilised the local currency which marginally weakened against the greenback to close the week at 107.02 compared to 106.98  the previous week. 

The Central Bank of Kenya has been conducting an anonymous online Kenya Diaspora Remittances Survey to establish ease of sending remittances back home. 

The study which ended yesterday focussed on the costs and efficiency of sending remittances, the difficulties encountered in sending cash or non-cash remittances, how remittances are used by the recipients, and the availability of information on investment opportunities in Kenya.

The high performance is coming just a day after the Kenyan government said it is going to streamline its global labour relations with the hope of earning Sh700 billion in diaspora remittances from just above four million citizens working abroad.

Speaking in Eldoret over the weekend, Labour Cabinet Secretary Simon Chelugui said the government had achieved a lot in mainstreaming labour migrations but it is still working on a few challenges including a lack of bilateral labour migration agreement with key destination countries.

The Labour boss said the government would deploy labour attaches in countries where Kenyans get jobs so that they help in ensuring Kenyans are not underpaid and frustrated while working abroad.