Diaspora inflows fall in Nov as Kenyans adjust to polls
Diaspora inflows fell slightly in November 2017 for the first time since August even as the cumulative flows in the first 11 months of the year hit a new record.
Official data yesterday showed Sh18.10 billion ($175.18 million), 5.56 per cent lower than Sh19.17 billion ($185.50 million) a month earlier, was remitted in the month that followed conclusion of a prolonged tense electioneering period.
“I would partly put that under the impact of (end of) the electioneering period, but I expect there was a recovery in December because even for businesses December was a much better month by far,” chief investment officer at Cytonn Investments Elizabeth Nkukuu said on phone.
“This year we could see even better flows because generally global markets are doing better. GDP in the Eurozone and the United States (US) is growing and we are also now in an investment environment, and so it is a stability year and people will be bringing money back home.”
More dollars help ease pressure on the shilling against demand by importers and companies paying expatriates and dividends to foreigners.
The remittances in first 11 months of 2017 reached an all-time high at nearly Sh180.15 billion ($1.743 billion), Sh19.11 billion or 11.50 per cent more than the Sh161.57 billion ($1.563 billion) a year earlier.
The Kenya Diaspora Alliance (KDA) chairman Shem Ochuodho last month estimated that about three-quarters of the remittances go into family support, including school fees and medical bills.
The share of remittances from North America, largely the US, in the 11-month period was 51 per cent or Sh91.89 billion ($889.14 million). This was a 16.41 per cent growth from Sh78.94 billion ($763.78 million) a year earlier.
Inflows from Europe grew the most at 21.88 per cent to Sh58.69 billion ($567.87 million) while dollar flows from the rest of the world dropped 14.26 per cent to Sh29.57 billion ($286.10 million).
“When you factor in remittances, North America leapfrogs to the top of our (Kenya) foreign policy,” Aly-Khan Satchu, the chief executive of investment advisory firm Rich Management Group, said via email on December 29.
“I was concerned that a MAGA (Make America Great Again) Trump was going to weigh on this curve, but so far we appear to have escaped that dragnet.”