Kenyan diaspora leading source of foreign exchange

Deputy President Rigathi Gachagua says the Kenyan diaspora community is now the leading source of foreign exchange in the country.

Speaking in Munich, Germany on Friday night, the Deputy President said that with the establishment of the State Department for Diaspora Affairs, the government is aiming at dedicating an accountable officer in charge of the community.

The State Department for the diaspora community, Rigathi said, will provide for smooth service delivery besides hastened redress to emerging issues of concern. 

“This is to also allow Kenyans living and working outside to have direct access and connection to the government for productivity and the benefit of the nation,” said Rigathi. 

He said the government values their contribution to the socioeconomic growth of the country.

“This is the reason we make deliberate moves to meet them, sitting with them and discussing with them about government development priorities. Most importantly, we listen to them more,” said the DP. 

Rigathi said it was a warm and exciting moment as he took note of the issues they wished to be addressed to make their stay more productive.

 “It is our commitment that we will solve the matters as we move forward,” he added.

Kenyans living and working abroad reduced the money they sent back home by Sh2 billion in September 2023, despite easing inflationary pressure in key markets including the US.

This is the second month in a row that the inflows have dropped from $354.3 million (Sh52.2 billion) sent in August to $340.4 million (Sh50.2 billion) that was recorded in September.

The reduced amount of money sent home by the Kenyan diaspora did little to support the country’s forex reserves, which continued to weaken further.

Forex reserves dipped to a low of $6,833 million (Sh1 trillion) just about 3.67 months of import cover from, $6,872 million (Sh1.01 trillion) a week earlier.

However, the Central Bank of Kenya is putting on a brave face despite the reduced forex reserves.

It maintained that the remittance inflows remained strong and continued to support the current account and the foreign exchange market.

Remittance inflows in September 2023 totalled $340.4 million (Sh50.2 billion) compared to $318.0 million in September 2022, an increase of 7.1 per cent.

In recent times, Saudi Arabia has emerged as the primary contributor to the rapid increase in remittances flowing into Kenya.

This development has prompted Nairobi to initiate discussions for a bilateral agreement with Riyadh.

This agreement aims to establish a structured framework for recruiting professionals to work in Saudi Arabia.

In 2022, Kenyan expatriates living and working in Saudi Arabia sent home a total of $302.26 million (equivalent to Sh44.6 billion).