Yet more bad news for those of us who are waiting for the Kenyan economic renaissance. According to the latest figures from Bloomberg’s office in Nairobi, remittances from the diaspora are down 9.4% this quarter. In total, $148.24 million was sent home in the first three months of this year, compared to $163.65 million in the same period last year.
To make matters worse, Forex Pros (no, I’m as in the dark as you are) have also got a little summary about the local situation that could just as well be entitled “Reasons Not to Invest in Kenya.”
While this is obviously uncomfortable news for those who are working in the financial sector, it could spell absolute devastation for those families who are dependent on remittances from the diaspora for school fees, loan repayments, or even just day-to-day living. Off the top of my head, I can think of at least three families for whom the loss of remittances are a disaster, and that’s just those who still have family abroad. Other families are having to cope with relatives returning home to search for work in Kenya, having cashed in their overseas chips.
What this points to is a much longer period of recovery than earlier forecasts may have predicted. We can’t depend on the stock market for recovery, if my opinions bear out, and trade is already down. What the economy needs is a concerted push in agriculture, horticulture, tourism and finance to build up momentum that cold feed into the economy as a whole. With the chiefs of all these sectors treating their market segments as personal fiefdoms, however, it’s doubtful if this will happen any time soon.
[Image by Kevin (Iapetus)]