Diaspora Remittances Lost Power

A recent article in the Kenya newspaper Business Daily titled “Kenya Diaspora inflows rise to Kshs 75 billion in a year,” caught my attention. The article stated that remittances have risen from $1.962 billion (2017) to $ 2.72 billion (2018). In an analysis of 2014 – 2018 the total remittances to Kenya total to $9.34 billion about Kshs 934 billion in 5 years. As I looked at these numbers, I saw the Diaspora remittances lost power.
Diaspora is a very significant contributor to the economies of Kenya and Africa as a whole. Diaspora remittances to Africa stand at about $45 billion per year and over $200 billion in last 5 years. This amount is higher than the sum of all direct or indirect AID. This amount is higher than all foreign investment amounts received by Kenya and other African nations over the same period.

This $200 billion remitted goes to the consumption economy. This is the lost Diaspora economic power. Africa has capitalistic elitist economies that only meet the needs of the politically class, who keep praising the Diaspora for their contributions. Diaspora economic power is in remitting their money into the production economy through investments in jobs creation opportunities and GDP growth.

Estimates are that in the 2019 – 2023 period the Diaspora Kenyans will remit to Kenya an average of $3 billion every year, a total of $15 billion or about Kshs 1.5 trillion in 5 years. In the whole of Africa the amount in next 5 years could reach an average of $50 billion/year and a total of $250 billion.

Africa’s land resource of 30 million km² is plenty. The continent’s population of about 1.3 billion is growing fast and the human resource is plenty. While Diaspora remittances play an important role in helping families and loved one meet their daily needs, the key and most important question those in the Diaspora need to ask is: How can we channel a fraction of our remittances towards investment and development related causes?

Investment will create more opportunities for people in their home countries. As things stand at present, Diaspora resources support weak economic systems and governments revenue. They do very little to benefit people with their social and economic needs and wealth creation. Diaspora remittances going to Africa as investment funds would enable the Diaspora contribute toward stronger sustainable and economic systems. This is the power Diaspora loses.
The power of the African Diaspora is lost when their remittances are not applied to make the land and human resource productive in a collective empowering manner. If Diaspora remittances flow to Kenya and Africa with a goal to make land and human resource productive; millions of jobs will be created as industries and institutions are built and opened.

The Africa Diaspora needs to urgently rethink of empowering themselves and Africa through designating a fraction of their remittances to go to economic and investment systems they create and have control over. Diaspora should not blame foreign investors who come into their countries and Africa at large to create opportunities for themselves as they get profits that they repatriate back. Diaspora should instead fully engage in Africa’s development.
In the mid 2000’s when we started the discussion that has become the Diaspora University Town plan for Kenya, I never envisioned the Diaspora remittances to Kenya would grow from about Kshs 40 billion per year to Kshs 270 billion per year 2018. In the last 20 years Diaspora has put in over $20 billion, about Kshs 2 trillion, into Kenya. It is time Diaspora turned their money into economic power by creating jobs and opportunities through opening Small Medium Enterprises (SMEs).

Surprisingly the power the Diaspora lose is the same power that created the Diaspora. If the Americans and other Western Nations had not applied their money resource into building infrastructure and institutions to meet their daily needs as well as create jobs; there would be no opportunities for the Diaspora. There would be no remittances to the tune of $45 billion/year to Africa. The remittances are a result of the jobs created.

Applying the land resource, human resource, money resource and systems resource will create opportunities of jobs and new wealth. The millions of Africans who migrated from Africa to the Diaspora to get jobs today have the money resource and systems resource power.

The knowing that one has power and not wanting to lose it, has made me plan to return to Africa with a system to open a medicine production plant and a research facility. Every hour I work on the system the more excited I become knowing that soon most of the medicine applied in treating people in Africa will be produced in Africa.
Diaspora scientists and entrepreneurs in other fields with systems are looking to apply them in Africa development. The Diaspora remittance resource can provide funding for these emerging entrepreneur class through investment to fund production systems by Diaspora.

Today those who are in the biotechnology and medical research field in the Western countries have enabled persons in the developed world to have a life expectancy of about 80 years. Africa’s life expectancy is at about 60 years. The power of Diaspora remittances will be felt as the life expectancy years in Africa rise to reach the levels of the western world.

Leave a Reply

Your email address will not be published. Required fields are marked *