23 April 2013

Zimbabwe: Govt 'Happy' With Financially Strong Diaspora

The government is said to be 'happy' with a Diaspora that continues remitting millions to Zimbabwe, because of the ongoing weak state of the national economy.

Recent figures from South Africa have suggested that roughly $600 million is being remitted to Zimbabwe annually from the Diaspora.

These figures are according to South Africa's First National Bank, which recently launched a cellphone-based cash remittance service to Zimbabwe. The Bank quotes research it conducted, showing that about 1.9 million Zimbabweans living and working in South Africa send home an average of R6.7 billion a year.

Another South African financial services group, Standard Bank, has said that it handled more than R1-million in transfers to Zimbabwe since it launched a similar money transfer service in December last year.

There are no official figures from Zimbabwe's government about the amount of formal remittances being channeled to the national economy. But the figures do suggest that the economy still relies on the Diaspora.

South African based economist Luke Zunga said according to research he had seen, the remittance figures are closer to R2 billion (or $200 million) a year. He told SW Radio Africa that this significant flow of money was why the government was not encouraging the Diaspora to return home en masse.

"There was a Zimbabwe investment conference held in South Africa (this month) and one of the addresses was by Deputy Prime Minster (Arthur) Mutambara. And he said: 'We are not encouraging the Diaspora to come home. Because once you are back home you are not very valuable. We'd prefer a strong Diaspora that will help this country to develop either by way of remittances or investment'," Zunga explained.

He continued: "So the message we are getting is that the government knows that the longer the Diaspora is out there, the better for Zimbabwe, financially."

Zunga meanwhile added that Zimbabweans are still reluctant to return home, mainly because of the political uncertainty that still remains there. But he said people "have a soft spot" for their home country, and are waiting to see the political climate changing "to put more money in their country."

"Zimbabweans are more effective if they invest in Zimbabwe but stay where they are. In the long term Zimbabwe will benefit from the investment aspect and not the remittances," Zunga said.

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