President Ruto targets to raise Sh1 trillion in diaspora remittances
Deputy President Rigathi Gachagua, President William Ruto and Prime Cabinet Secretary Musalia Mudavadi at Mount Kenya Safari Club in Nanyuki on January 5, 2023.
President William Ruto has revealed plans to drive an aggressive global job hunt for Kenyans, aiming to grow diaspora remittances to supplement local resources.
The President targets to grow the remittances from about Sh430 billion by November 2022 to a trillion shillings.
In an interview with different television stations on Wednesday, President Ruto said to grow the remittances, he will use the Ministry of Foreign and Diaspora Affairs to seek jobs for skilled Kenyans in other countries.
“Kenyans are outstanding everywhere they go – whether it’s in tourism, hospitality or other industries – they stand out globally. We have a resource.
“I intend to drive the agenda to make sure that we leverage the many Kenyans who have skills, we get them working everywhere in the world. That’s why I have set up the Ministry of Diaspora, put a PS there and told her that she has no other business, she must get Kenyans working everywhere. And every Kenyan who is working everywhere must be serviced by the government of Kenya,” President Ruto said.
Remittances growth
Kenya’s diaspora remittances have grown by about 30 per cent over the past three years, the value largely drawn from an increasing number of Kenyans leaving for jobs outside and the weakening of the Kenyan shilling.
In 2020, Kenyans working abroad sent back about Sh330 billion, which rose to an average of Sh407 billion in 2021 and upwards of Sh430 billion by November last year.
“I intend to raise, by God’s grace, the Sh400 billion to a trillion shillings, then we will be talking business. We will be creating jobs locally and driving our jobs agenda internationally,” Dr Ruto said.
This is a view he has held since being sworn into office in September last year, with the ministry laying planning to grow remittances to $6 billion (about Sh741 billion by current exchange rates) by 2030.
The new administration’s ambitious target comes as a new report revealed the struggles Kenyans in the diaspora are going through to manage to send back cash.
In the October 2022 survey by global payments firm WorldRemit, 19 per cent of Kenyans working abroad, mainly those in the US, UK and Australia, admitted to taking side jobs to sustain their remittances.
“These findings demonstrate the grit of economic migrants in adapting to wider financial stresses and the rising cost of living while still meeting the needs of their families at home, and abroad,” said Ivan Kanyali, WorldRemit’s regional manager for East Africa.
President Ruto’s government intends to leverage the remittances to support the undertaking of some of the development projects he promised the electorate.
One of the headaches the government will face in the bid to grow remittances will be the high costs incurred by Kenyans sending cash back home to their families, which deter some from sending as much as they would want.
“On average, the cost of sending funds was in the range of 4– 5 per cent of the amount remitted while using the most dominant and preferred service providers (mobile money operators, money transfer companies and banks). The use of courier companies was established to be the most expensive channel of sending money in 2019, costing 29.2 per cent of the value remitted,” a 2021 Central Bank of Kenya survey stated.
