22 January 2013

Kenya: Diaspora Remittances Hit Record High

Photo: Business Daily.
Counting foreign currency.

Nairobi — Kenyans in the Diaspora sent home over Sh9 billion in remittances in December, pushing transfer of funds for the year to a record high of Sh104.3 billion.

The Central Bank of Kenya reports that in the month of December 2012, remittances to Kenya grew by 24 percent to Sh9.19 billion compared to Sh7.4 billion and Sh8.47 billion recorded in December 2011 and November 2012 respectively.

Consequently, the 12-month cumulative average flow reached a peak of Sh8.48 billion in December 2012 from Sh6.46 billion in December 2011.

The sustained increase resulted in a 31.4 percent growth in remittance inflows from Sh77.4 billion in 2011 to Sh104.3 billion in the full year of 2012, an indication of resilience in remittance inflows to Kenya despite a weak global economy.

Remittances are the fourth-largest source of foreign exchange in East Africa's biggest economy after revenue from tea, horticulture and tourism.

Remittances from all source markets have grown substantially since the second half of 2012, with inflows from North America accounting for almost half of the total flows.

In the month of December 2012, inflows from North America grew by 17 percent, while remittance inflows from Europe accounted for 28 percent.

The CBK noted that Kenyans living abroad typically send money home to help their families and for investment in various sectors like real estate.

They have also been investing in government securities targeted at them, such as infrastructure bonds and the long-term savings development bonds.

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