Diaspora inflows hit Sh67bn-North America main source for the remittances
Kenyans living and working abroad sent home Sh67.16 billion in the first three months of the year, underlining the dependability of the inflows and importance to the economy.
The inflows rose 11.4 per cent to $221 million (Sh22.32 billion) in March from $199 million (Sh20.11 billion) in February, helping to propel first quarter remittances above Sh64.79 billion that was sent during the first quarter of last year.
Data by the Central Bank of Kenya (CBK) shows that the 12-month cumulative inflows increased to Sh274.84 billion in March this year from Sh217.7 billion in March last year, reflecting a 26 percent growth.
“North America remained the main source region for the remittances, accounting for 53 percent of the total in March,” CBK noted. Strong remittances position has helped keep the shilling relatively stronger. CBK’s usable foreign exchange reserves were $8.254 billion (Sh833.16 billion) in March, translating to 5.31 months import cover.
The shilling closed March averaging 100.86 units against the dollar. It has remained relatively stable, exchanging at 101.39 at the close of last week.
Last year, current account deficit narrowed to stand at Sh441.8 billion in 2018 compared to Sh503.4 billion the previous year, partly supported by strong diaspora remittances.
“The secondary income account posted a surplus of Sh507 billion in 2018 from a surplus of Sh460.5 billion in 2017, mainly supported by remittances from the diaspora,” Kenya National Bureau of Statistics (KNBS) said.
KNBS adds the shilling exchange rate against major trading currencies is expected to remain stable supported by diaspora remittances and a significant level of reserves.
The first quarter performance sets stage for the country to surpass the Sh272.44 billion that was sent last year. The 2018 remittances smashed CBK’s target of Sh259.3 billion.
Remittances have remained strong in the recent past, hitting monthly high of Sh26.88 billion in June last year.