Remittances in 2013 rose to a historical high despite a significant erosion of the growth rate in comparison to the previous year.
Kenyans living abroad sent back home Sh110.76 billion ($1.29 billion) compared to the Sh100.4 billion ($1.17 billion) sent in 2012, setting a new record. Despite this, remittances in 2013 posted the slowest growth rate since 2010.
Last year, diaspora inflows grew 10.2 per cent in comparison to the 31.3 per cent growth posted in 2012. In 2011 remittances rose 38 per cent.
Dr Joy Kiiru, a Nairobi university economist who has studied diaspora remittances in Kenya, said the slower growth could be attributed to a lagged response to the economic crisis that has had its grips on Europe and the United States over the last few years.
“Kenyans living abroad have remained largely resilient in terms of sending money back home but I think this is the effect of the crisis. It was not felt immediately. There was a time lapse,” said Dr Kiiru.
Following the financial crisis in 2008-2009, many of the world’s economies plunged into recession and are only just beginning to come up for air.
World Bank research shows that migrants living in developed economies were among the most affected demographic groups by the high levels of unemployment as a result of recession. According to Dr Kiiru, the potential positive impact of economic recovery is also unlikely to be felt in Kenya immediately.
However, Mr Robert Bunyi, a market analyst, said based on the broad statistics provided by Central Bank, it is “very hard” to draw conclusions on diaspora remittance trends.
