Kenyans abroad defy Covid to send home more money in 2020:Remittances hit Sh331.9 billion in 12-months to November last year.

Kenyans abroad defy Covid to send home more money in 2020

Remittances hit Sh331.9 billion in 12-months to November last year

Last year was a record inflow; a staggering performance by a sector that most policy makers and analysts had predicted would decline.
•It came as a relief for hundreds of families battling job losses and poor returns from businesses in the country, where at least 75 per cent of SMEs closed shop.

The US Dollar notes/FILE
Kenyans living and working abroad defied tough Covid-19 economic times to send more money home, as diaspora remittances hit a new high in 2020.
Central Bank of Kenya(CBK) data shows cumulative inflows in the 12 months to November 2020 totaled $3.045 billion ( about Sh331.9 billion) , compared to $2.790 billion (Sh 304.1 billion) in the 12 months to November 2019.
“Remittance inflows remained strong in November amounting to USD 257.7 million (Sh28.1 billion) compared to USD 218.8 million (Sh23.8 billion) ) in November 2019, an increase of 17.7 per cent,” the apex bank notes in its recent weekly bulletin.

The increase on inflows came even as the Covid-19 pandemic ravaged economies across the world.

It came as a relief for hundreds of families battling job losses and poor returns from businesses in the country, where at least 75 per cent of micro enterprises closed shop during the year.

According to a survey by the Kenya Private Sector Alliance (Kepsa), the pandemic also rendered millions jobless across multiple sectors of the economy, estimated at more than 5.9 million , with companies and industries struggling to remain afloat through downsizing and salary cuts.

Tourism was the most hit sector with at least 3.1 million jobs affected, the survey dubbed ‘Assessing the Covid-19 impact on businesses, jobs and opportunities for faster recovery’, conducted between September and October, indicates.

In October, remittances totaled $263.1 million (Sh28.8 billion), which was an increase from the previous month’s $260.7 million (Sh28.4 billion), as the diaspora community continued to play a critical role in cushioning the local economy and households from Covid-19 shocks.

The highest amount Kenyans sent home in a month last year was however in June, totaling $288.5 million (Sh31.62 billion) , with the lowest being in April where $208.2 million (Sh22.8 billion) was sent.

This was at the height of the Covid-19 impact on global economies, with Kenya reporting its first case on March 12.
Remittances in August and July were $274.1 million (Sh30.04 billion) and $276.9 million (Sh30.34 billion), respectively.

The high value of remittances compared to last year is an indicator of Kenyans abroad being more supportive and keen to cushion loved ones at home from the impact of the pandemic.

Last year was a record inflow; a staggering performance by a sector that most policy makers and analysts had predicted would decline.

The World Bank, for instance, had projected that remittance flows to low and middle-income countries were expected to drop by around 20 per cent to $445 billion (Sh47.6 trillion), from $554 billion (Sh59.2 trillion) in 2019.

Consistent diaspora remittances to the continent amounted to $80 billion, of which $48billion were attributed to sub-Suharan Africa remittances for 2019, according to the World Bank.

Nigeria was the largest recipient of remittances in sub-Saharan Africa and is the sixth-largest beneficiary among low-to middle-income countries, with an estimated $23.8 billion (Sh2.5 trillion) received in 2019.

This is an increase of more than half a billion dollars compared to 2018. Ghana and Kenya are ranked a distant second and third in the region, with an average $3.5 billion (Sh374 billion) and $2.8 billion (Sh305 billion) received , respectively.

Over 70 per cent of the diaspora inflows to Kenya are from North America and Europe.

Kenya’s National Treasury has been keen to tap the diaspora market to support economic growth through investments in the country, with a keen focus on the capital market in rising infrastructure development funds.