Discussion Paper No. 143 of 2013 on Institutional and Policy Framework Necessary for Harnessing Diaspora Remittances in Kenya

Abstract

Many countries, Kenya included, are aware of the developmental potential the diaspora can offer to their countries of origin, especially through their remittances. This study sought to explore the extent to which Kenya has created the necessary institutional and policy framework to tap into diaspora remittances. The study made use of literature review and comparative case studies to realize its objectives. The study has revealed that Kenya lacks appropriate institutional and policy framework to harness and channel diaspora remittances to realize certain predetermined objectives. Diaspora related outcomes are largely left to chance and are not willed or premeditated upon. The characteristics of the diaspora are largely unknown and diaspora engaging institutions are far much weaker compared to those of India and Ethiopia. The policies of engaging the diaspora, such as those adopted by Ethiopia are to a great extent ‘one-way-street’ and lean more towards the category of extracting obligation. In addition, policies and institutions for engaging the diaspora operate independent of each other, with no synergies between them. The study proposes the formation of a ‘one-stopshop’ to handle all matters related to the diaspora, such as informational issues, trade, investment and to protect the rights of the diaspora, especially the low skilled emigrants. As a first step, the created institution(s) must seek to know and understand its diaspora to enable creation of appropriate policy responses to tap into its development potential. Due to the complexity of remittance environment and diaspora related issues, to the greatest extent possible, policy options should be informed by research. The government should look at the possibility of organizing a diaspora day and recognize the achievements of Kenyans in the diaspora and ‘market’ policies and strategies they would wish them to participate.