National

State plans special dollar bond for Kenyans in diaspora

Prime Cabinet Secretary Mudavadi is pictured with Chidi Blyden, deputy CEO of the Millennium Challenge Corporation, in Washington DC on January 31, 2024, during his tour of the US. (Photo: X/ Musalia Mudavadi)

By Issa Hussein | Sunday, February 4, 2024

Kenyans abroad send more than Sh650 billion back home annually, according to estimates by World Bank's Multilateral Investment Guarantee Agency (MIGA).

The government is working on an innovative dollar bond for Kenyans in the diaspora to enable them to contribute to the country's economic transformation.

Prime Cabinet Secretary Musalia Mudavadi said the bond will be structured by the World Bank's Multilateral Investment Guarantee Agency (MIGA) and the National Treasury.

Keep reading

Mudavadi, also the minister for foreign and diaspora affairs, made the announcement on his three-day visit to the US, during which he held talks with MIGA Executive Vice President Hiroshi Matano.

"We are working on a secure bond that will offer better returns than interest rates in the source markets for our diaspora remittance, " he said.

Mudavadi noted that MIGA's estimates reveal Kenyans abroad send more than Sh650 billion back home annually, further suggesting that their savings in foreign banks could be of the same amount or even more.

He said that the bond will enable the government to diversify its public debt mix, reducing the country's exposure to costly commercial debt.

Mudavadi travelled to the US for key talks with various senior officials on the Kenya-United States Strategic Trade and Investment Partnership, the focus being to strengthen cooperation between the two countries.

The CS also held discussions with Development Finance Corporation (DFC) Chief Officer Scott Natha and Millenium Challenge Corporation (MCC) Deputy Chief Executive Officer Chidi Blyden.

He urged the DFC to invest in Kenyan projects with high multiplier effects to boost the Botton-Up Economic Transformation Agenda (BETA).