Dollar inflows from Kenyans working in the United States and Canada were the main contributors to foreign remittances, hitting the $1 billion mark in 2012.
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Data released on Tuesday by the banking regulator showed Kenyans working in the US and Canada were the main senders of money back home.
The Kenyans living abroad remitted $1.17 billion (Sh101.7 billion) last year.
Economists suggested that the growth in remittances is mainly driven by an increase in the number of Kenyans working in industries such as health and academia, which are relatively recession resistant.
Ongoing economic recovery in the US helped to grow remittances from Kenyans in the diaspora by nearly a third last year, a Central Bank report shows.
Data released on Tuesday by the banking regulator showed Kenyans working in the US and Canada were the main senders of money back home, with remittances exceeding the $1 billion (Sh86 billion) mark.
The Kenyans living abroad remitted $1.17 billion (Sh101.7 billion) last year.
“The sustained increase resulted in a 31.4 per cent growth in remittance inflows from $891.1 million in 2011 to $1.2 billion in the full year of 2012, an indication of resilience in remittance inflows to Kenya despite the weak global economy,” said the Central Bank of Kenya (CBK) in a statement.
The North American region whose economies are still recovering accounted for nearly half of the inflows, followed by Europe which is also emerging from a recession.
Remittances from North America accounted for 49.3 per cent or $52.1 million (Sh4.53 billion) sent in December last year, slightly up from $44.5 million (Sh3.87 billion) sent in October when the share from this region accounted for 48.5 per cent of total dollar inflows.
Over the same fourth quarter remittances from Europe accounted for $29.3 million (Sh2.55 billion) or 27.7 per cent, up from $25.4 million (Sh2.2 billion) in October. The eurozone’s share of overall remittances remained the same at 27.7 per cent.
Economists suggested that the growth in remittances is mainly driven by an increase in the number of Kenyans working in industries such as health and academia, which are relatively recession resistant.
“Kenyans tend to migrate to high-skill zones of the labour market such as health, pharmaceuticals, universities, and research.
"These sectors have tended to be resilient in the US recession, compared to sectors that virtually collapsed, such as construction and financial activities allied to Wall Street,” said Dr Mbui Wagacha, a consultant economist with the CBK.
Remittances from other regions also increased over the last quarter of 2012 to $24.3 million (Sh2.11 billion) by the end of December from October’s $21.8 million (Sh1.89 billion).
Increase in dollars would be welcomed by the Treasury as it offers a cushion for the country’s import cover, which in turn strengthens the shilling.
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