Kenyans abroad investing back home put most of their money in the stock market and private equity instruments as they sought alternative investment avenues beyond real estate property.
A survey by Norwegian-based accelerator company, Pangea Trust, says that about 36 percent of Kenyan diaspora sent their money home to buy to stocks and invest in private equity.
Kenyans abroad investing back home put most of their money in the stock market and private equity instruments as they sought alternative investment avenues beyond real estate property.
A survey by Norwegian-based accelerator company, Pangea Trust, says that about 36 percent of Kenyan diaspora sent their money home to buy to stocks and invest in private equity or venture capital related instruments, ahead of 31 percent that directed their investment funds to their own businesses.
About 23 percent sent to family member-owned business.
The growth and diversity has been attributed to financial innovations in the market that has provided Kenyans in the diaspora with more channels for transactions.
“Very few investments were directed at local non-family-owned businesses… 10 percent of Kenyan diaspora invested in other businesses. It is possible that this is linked to lack of access to credible information on available opportunities of MSMEs that they could invest in,” the report stated.
The survey is part of Diaspora Investment Partnership done in collaboration with Swedish International Development Cooperation Agency and Swedish embassy in Kenya to mobilise remittances and fund start-ups and SMEs.
The respondents included 143 Kenyans spread across 27 countries like Sweden, Finland and, the US.
Most of private diaspora investments went to real estate and construction sector with 29 percent or nearly 1 out of 3 out of the diaspora members surveyed indicating having invested in the sector.
The inflows which constitute the largest source of foreign exchange reserves were also directed to agriculture and agribusiness sector, financial services and entertainment of arts sector.
Sectors with the least investments include manufacturing, healthcare, and green business.
The country has been recording high remittance inflows at a time when global economy is still recovering from Covid-induced contraction.
Diasporas remittances rose by 20 percent in the nine months to September to $2.71 billion (Sh301 billion), up from $2.27 billion (Sh252.5 billion) in the previous period last year.
The growth of remittances has been attributed to growth of immigrant populations moving out of the country in search of jobs, increased earnings by the immigrants and crisis that saw the population send more money to cushion family back at home.
US market contributes the largest share at 53.85 percent ahead of UK, South Africa and Saudi Arabia at 7.4 percent, 6.3 percent and 3.9 percent respectively.
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