August 17, 2022

Sacco Review|The Leading Newspaper for Co-operative Movement in Kenya

The Leading Newspaper for Co-operative Movement in Kenya

Ministry targets cash-rich Kenyans in diaspora to boost Co-op sector


By Stephen Makabila
One of the major roles of the newly formed Department of Policy and Research at the State Co-operative headquarters would be roping in the rich diaspora to boost the local co-operatives sector growth in coming years.
Principal Secretary for the State Department of Co-operative Development, Ali Ismail Noor recently appointed Stanley Ongeti as the new head of the policy and research department, deputized by the PS’s former Personal Assistant , Symon Mburia.
While Mr Ongeti holds the position of an Assistant Commissioner of Co-operative, Mr Mburia is a Chief Co-operative officer, further demonstrating the level of interest the Government has in tapping the diaspora to boost the co-operative sector, billed the most vibrant on the African continent.
Part of the new department’s brief will be to research and come up with ways of how best to improve the country’s diaspora policy in relation to the co-operative sub-sector.
According to a World Bank report, Kenya is among the highest recipients of remittances in Africa. In 2015, Kenyans in diaspora sent home a record $1.6 billion (Sh163 billion).
And while cash remittances remain significant and arguably the largest source of forex inflows, experts further point out a deeper appreciation of diaspora potential would push the country to re-evaluate national policy priorities and put it at the core of national aspirations such as Vision 2030.
Last year, the National Government held the Kenya Diaspora Investment Conference whose theme was Development and innovation: Opportunities for Diaspora, at the Windsor Golf Hotel and Country Club in Nairobi.
It was the first conference that brought together the Government, Kenya’s envoys, members of the Kenyan Diaspora, the private sector and other stakeholders to engage on issues that are of great importance to Kenyan Diaspora and the country at large.
And while financial and legal hurdles have been cited as the stumbling block to the realisation of the huge potential of remittances, analysts say the Government should create an enabling environment by for instance offering tax breaks to encourage Kenyans living abroad to invest locally.
“The Government has realized the critical role the diaspora can play in national development and thus the co-operative sector is also on the fore-front of tapping into this new area to boost growth as we seek to realize Vision 2030 and beyond,” Mburia told Sacco Review.
Experts note that majority of Kenyans working abroad desire to retire back in the country, and therefore work on Retirement Plans some with the help of formal financial advisers but the majority remain in the informal systems.
Individual Saccos are also going for the diaspora market and one of them, Kimisitu Sacco, which has 7,000 members, also plans to tap into the diaspora market.
There is also already the Kenya –USA Diapora Sacco in place, with offices in Atlanta and Nairobi, which has eased financial transaction even through the local Safaricom M-Pesa platform.
And given most of the Saccos in Kenya have re-branded, membership is now open to all eligible Kenyans whether locally or in foreign countries.