Prime Cabinet Secretary Musalia Mudavadi has said that the Government is packaging a Diaspora bond that will enable Kenyans abroad to invest in priority development projects.
Mudavadi, who is also the Cabinet Secretary for Foreign and Diaspora Affairs, said a Diaspora bond will harness the power of diaspora resources to support Kenya’s key infrastructure projects such as the expansion of Jomo Kenyatta International Airport and upgrading of Mau Summit – Malaba highway.
“We want to be able for now to actualize a Kenyan diaspora bond. According to data from World Banks’ Multilateral Investment Guarantee Agency (MIGA), and the statistics at the Ministry of Foreign and Diaspora Affairs, the quantum of resources available can now justify a diaspora bond,” Mudavadi said when he launched the State Department for Diaspora Affairs’ Strategic Plan 2023-2027 at the Kenya School of Government.
“The resources can then be harnessed into supporting infrastructure development and perhaps, the debate we are having around how to develop the JKIA, and expand it, could be a candidate. We can mobilize diaspora resources, to partner with other private sector resources and actually fund this piece of infrastructure,” he explained.
He regretted that JKIA, a strategic infrastructure, was being left behind as other major were being expanded and upgraded.
“The truth is that if you went to West Africa today, whether you are landing in Ghana, Togo or you went to Addis or Rwanda, their airports have overtaken Jomo Kenyatta International Airport.” he said.
“We are spending too much time and yet others are running. The numbers aside, the fact is that we now must invest in a new airport. So, we can deal with the numbers, the debate and arguments, but let us not lose focus that we need to actually upgrade our facilities, key among them the airports.” he added.
Mudavadi noted that the growth in diaspora remittances indicates that Kenyans abroad make direct investments locally, providing social support and creating an enabling environment that contributes to various sectors of the economy including education, health, housing, agriculture, tourism and trade.
“It is worth noting that remittances grew to USD 2.8 billion from January to July 2024, from USD 2.4 billion during a similar period in 2023. A closer analysis of the trend over the first seven months of 2024 points to a projected rise in annual remittances from USD 4.19 billion in 2023 to USD 4.8 billion in 2024, a remarkable 14.6pc increase,” he said.
He gave an example of the Indian Diaspora bond packaged with MIGA’s assistance that was oversubscribed.
“I had an opportunity to visit the Multilateral Investment Guarantee Agency (MIGA) of the World Bank and we got talking and they said that the more recent bond they have is for India. India has a very robust diaspora bond, they floated it and were able to get over USD 5 billion from the diaspora. In fact, they had to terminate at some point because it was being over-subscribed.” he explained.
He called for broader stakeholder engagement to have an open mind and support initiatives that will help in Kenya’s transformation journey.
Mudavadi said he looked forward to a vibrant diaspora community that will support the Government’s agenda of deepening the contribution of the diaspora to Kenya’s socioeconomic transformation.
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