Time flies with great content! Renew in to keep enjoying all our premium content.
Prime
Australia beats Germany, Saudi Arabia in remittances
Fresh CBK data shows the remittances for January showed signs of a slowdown, growing a modest 3.63 percent year-on-year to $427.38 million (about Sh55.13 billion).
Australia overtook Germany and Saudi Arabia to become the fastest-growing source of diaspora remittance in 2024 as dollar flows from Kenyans abroad rebounded from a two-year slowdown.
Kenyans in Australia sent home $184.13 million (about Sh23.75 billion) in the year ended last December, official numbers showed on Wednesday, a 2.57 percent climb over $106.70 million (about Sh13.76 billion) in the prior year.
The bump catapulted the world’s eighth largest country by land mass and 14th biggest economy to become the fastest leapfrog become the fastest growing among the five biggest sources which account for more than three-quarters of diaspora inflows into Kenya.
Diaspora remittances from Germany, which grew at the fastest pace of 35.71 percent in 2023, slowed last year, according to data from the Central Bank of Kenya based on flows through formal channels.
Kenyans in Germany, which reached a deal on streamlining labour migration rules with Kenya in May 2024, grew 12.19 percent to $197.25 million (about Sh25.45 billion).
Another slowdown was witnessed in flows from Saudi Arabia, a top destination for domestic and semi-skilled labourers, which was before 2023 the fastest-growing source of remittance.
Kenyans in the Middle East’s economic powerhouse remitted $403.12 million (Sh52.00 billion) in 2024, a growth of 9.01 percent over the prior year, which helped that country remain the second largest source after the United States.
Inflows from the US recovered from two consecutive years of slowdown to grow 12.34 percent to $2.63 billion (about Sh339.17 billion), or 53.17 percent of total diaspora remittances.
The UK’s revenue rose 7.01 percent year over year to $357.62 million (Sh46.13 billion), retaining its position as the third largest source.
This came in a year where total cash wired back home by Kenyans in foreign countries grew nearly a fifth (18.03 percent) year-on-year to nearly $4.95 million (about Sh637.93 billion), the biggest growth in three years on easing global inflationary pressures.
Soaring energy and food prices on supply disruptions that followed Russia’s brutal invasion of Ukraine in February 2022 had pushed up living costs in the US and Europe to decades-high, eating into disposable income that Kenyans in those countries tap to help families and dependents back home.
Slower growth in inflation frees up cash, leaving workers with more disposable income to spend than in a high inflationary environment from early 2022 through last year.
Fresh CBK data shows the remittances for January showed signs of a slowdown, growing a modest 3.63 percent year-on-year to $427.38 million (about Sh55.13 billion).
This is slower than 18.04 percent climb to $412.41 million (about Sh53.20 billion) a year ago. Growing employment opportunities for Kenyans in foreign countries is ranked top of President William Ruto’s job creation strategy, together with the affordable housing.
Since taking power in September 2022, President Ruto has pledged to negotiate bilateral labour deals with developed economies to create jobs for Kenyan youths abroad.
“It is my intention that every year we should be able to send 250,000 Kenyans to work in different parts of the world so that we can enhance and increase the number of people working abroad and enhance our remittances from abroad,” He said in May 2024. “I am committed and I believe that is doable because I can see that we are on the right trajectory.”
The largest share of the remittances goes into supporting families at home to buy food and household goods as well as pay medical bills and school fees, according to the CBK-commissioned Kenya Diaspora Remittances Survey Report of December 2021.
