Saudi remittances up 68pc as Kenya eyes labour deal
Cabinet Secretary for the Ministry of Foreign Affairs Dr Alfred Mutua during an interview at his office in Nairobi on October 28, 2022. PHOTO | JEFF ANGOTE | NMG
Saudi Arabia has become the fastest-growing source of remittances into Kenya, prompting Nairobi to seek a bilateral deal with Riyadh over a framework under which professionals will be recruited in the Middle East country.
Kenyans working and living in Saudi Arabia wired home $302.26 million (Sh37.78 billion) last year compared with $185.01 million (Sh23.12 billion) in 2021 despite elevated global inflation that hurt inflows from major sources.
The 63.38 percent jump in diaspora inflows from the oil-rich country bucked a trend of reduced overall remittances as major economies across the world battled runaway inflation that squeezed household budgets.
Data tracked by the Central Bank of Kenya (CBK) — based on cash flows through formal channels — show the Middle East’s largest economy was the biggest driver of growth in remittances into the country last year with Sh14.65 billion more compared to 2021.
This happened in a year overall inflows grew 8.34 percent to $4.03 billion (Sh503.40 billion), a slowdown from a 20.15 percent rise to $3.1 billion (Sh387.43 billion) the previous year.
Kenyans abroad typically send money to help their families offset bills like school fees and medical expenses as well as invest in projects like real estate.
Three countries—the US, the UK and Saudi Arabia— account for nearly three-quarters of total annual inflows which partly help cushion the shilling against the globally-bullish US dollar by helping the supply side of the foreign exchange market.
The emergence of Saudi Arabia as a top source of remittances has come amid growing pressure on Kenyan authorities to enforce measures to protect her migrant domestic workers in the Middle East.
A considerable number of domestic workers in Saudi Arabia are reportedly battling pain and agony after fleeing joblessness in an economy struggling to create employment opportunities for her growing skilled youthful population.
Alfred Mutua, the Cabinet secretary for Foreign and Diaspora Affairs, has disputed reports of widespread mistreatment of Kenyan workers in Saudi Arabia, insisting the majority of those who have found the going tough were lawbreakers.
Dr Mutua, who made a visit to Riyadh his first major assignment upon being appointed last November, said the majority of Kenya’s migrant workers in Saudi Arabia were leading decent livelihoods.
Kenya’s top-most diplomat has, however, blamed the recruitment agencies for failure to invest in training domestic workers before connecting them with employers as well as Kenyans running criminal gangs in Saudi Arabia.
“Our girls are suffering because of these agencies because they don’t want put money into training our girls. Not all [of them], but quite a number,” Dr Mutua told Citizen TV last month.
“For every 100 girls, 20-30 girls vanish at the airport, picked up by other Kenyans to undertake an illicit activity.”
The ministry, he says, has initiated preliminary talks aimed at developing a framework under which Kenyans will be recruited to work in Saudi Arabia.
Conservative estimates indicate about 200,000 Kenyans have secured employment in the Gulf country, 60 percent of whom are professionals in sectors such as healthcare, ICT and construction.
“It is not all gloom as we hear. There are many opportunities. One of the things we have been debating on is that we don’t want a lot of Kenyans to go there as domestic workers. We have got a lot of people who have finished university in Kenya who can work in the ICT, motor industry etcetera,” Dr Mutua said.
“We are about to sign a labour agreement with them [Saudi Arabia] so that we get more professionals to be allowed to go over there.”
Currently, most of the workers are recruited and connected to employers by agencies under the “kafala” system.
The system is used in the Gulf— including Saudi Arabia, Qatar, United Arab Emirates, Bahrain, Oman, Kuwait and Lebanon — to monitor migrant workers in domestic and construction sectors.
It ties the legal status of foreign workers in those sectors to their employers, barring them from changing jobs or leaving the country without the approval of their bosses.
That is what has facilitated reportedly widespread abuses at the hands of callous employers in the Gulf.
The Labour ministry in June said plans were afoot to trace Kenyans suffering in the Middle East, insisting there were stringent measures to control illegal labour immigrants.
In the original budget for this financial year ending June, lawmakers approved a Sh374 million expenditure to build a safe house in Saudi Arabia’s capital, Riyadh, to give refuge to Kenyan workers facing abuse.
The budget was initially Sh304 million before being increased by Sh70 million after the Labour ministry pleaded its case before the Finance and National Planning committee of the National Assembly in June.
The plan to put up a safe haven for migrant workers in the Gulf region has been on the cards since 2015 when the National Assembly committee on Labour and Social Welfare at the time asked the Treasury to “provide a special fund to the missions in the Middle East… to deal with the numerous migrant labour challenges, including setting up a safe house.”
