The Strategies of the Private Sector in Harnessing Kenya’s Diaspora for Domestic Investment

The contribution of migration to development and the subsequent migration-development nexus have increasingly been receiving a lot of attention especially with the growing number of remittances from migrants abroad. The contribution of diaspora remittances to national economic development has been a contentious issue but it is clear that they do positively impact families and households back at home. The Diaspora Option is a new policy orientation which seeks to leverage on the social, financial and intellectual capacity of the diaspora so as to develop their countries of origin. On the other hand, the private sector is a key stakeholder when it comes to diaspora engagement due to the different products and services, they offer them such as banking and real-estate. Kenya's private sector for example, is very crucial for the economic development of the country as it is the Incline contributor to the country's growth and employment. However, even with this recognition of the key role that diaspora populations play in their countries of origin, there are still gaps in literature on the modes of diaspora engagement, specifically by the private sector. This study was undertaken to learn more about the diaspora and how the private sector is harnessing them to promote national economic development. The study sought to achieve the following objectives: To evaluate Kenya's policy environment for private sector-diaspora engagement in the finance, real estate and banking sectors; To assess how Kenya's private sector engages the diaspora and to assess the effectiveness of the diaspora engagement strategies by Kenya's private-sector. With guidance from the research objectives, the study seeks to answer the following research questions: 'What is the policy environment in the finance, real estate and banking sectors which promotes private sector-diaspora engagement in Kenya? How does Kenya's private sector engage Kenya's diaspora? To what extent have the diaspora engagement strategies by Kenya's private-sector been effective? This was exploratory research utilizing a mixed-methods approach where quantitative data was collected first, and thereafter qualitative data collected. This study was be limited to three sectors in the private sector banking, real estate and financial institutions. Purposive sampling was employed to determine the respondents, and data was collected using self-administered questionnaires and interviews. Findings from this research indicate that the private sector is engaging the diaspora, however, not extensively. The private sector is also working in silos, with majority of the institutions lacking specific personnel to deal with diaspora affairs. The study also found that the government and the private-sector are not adequately collaborating to reach the diaspora and harness them for domestic investments. Study findings also indicate that the banking sector recognizes Kenya's diaspora as key stakeholders for domestic investments through the products and services they have as well as their accessibility to the diaspora. The finance and real estate sectors however engage the diaspora as and when the need arises and have therefore not invested in having the diaspora as key stakeholders.