Commentary (by Kimanthi Njoka) - Kenyans abroad remitted Sh3.5b in January

Ref: http://www.eastandard.net/news/?id=1143983228&cid=4

Published on March 13, 2008, 12:00 am

By Kimathi Njoka

Remittance by Kenyans in Diaspora stood at Sh3.5 billion ($53,925) in January.

The amount was the highest to have been remitted over the same period since 2004.

The record payments indicated no effect by the political crisis that rocked the country following the disputed December 27, presidential election.

Central Bank of Kenya (CBK) data indicate that the remittance has been on an upward trend since 2004. The CBK data indicated that the amount jumped from Sh22.2 billion ($338,326) in 2004 to a high of Sh37.6 billion ($573,643) last year.

The strong growth in remittances over the last five years has helped stabilise the shilling’s exchange rate and provided source of investment funds.

However, the figures might be higher as CBK data only captures remittances that come into the country through the official channels.

In January last year, remittances totalled Sh2.68 billion ($40,930), up from Sh2.06 billion ($31,506) in January 2006. Annual remittances over the same period hit Sh37.6 billion last year from Sh26.7 billion.

Kenyans in the Diaspora have in the recent years emerged as a key player in the economic activities in the country following the rebound of the economy.

Remittances are mainly channelled to fund managers, trusted relatives and lawyers for investment in real estate, stock exchange and the transport sector with returns being shared between the remitters and their dependants locally.

The World Bank reckons that although the transfers help the families escape poverty, the big challenge is harnessing the money for development.