As Nigeria and other African countries continue to explore alternative sources of revenues to meet developmental challenges, President of the African Development Bank (AfDB) Group, Dr. Akinwumi Adesina says diaspora remittances to the continent should be acknowledged, respected and further explored.
Adesina’s observation is based on the fact that the value of remittances from the African diaspora doubled from $37 billion in 2010 to $87 billion in 2019 reaching $95.6 billion in 2021.
The AfDB President further said, “yet, official development assistance to Africa in 2021 was $35 billion or 36 percent of the remittances from the diaspora.’’
According to him, Egypt and Nigeria are among the top 10 remittance recipients globally with $31.5 billion and $19.2 billion in 2021 respectively.
He stated this at a recent event on ‘’Development Without Borders, leveraging the African Diaspora for Inclusive Growth and Sustainable Development in Africa’’, organised by the bank in collaboration with the African Union Commission, the International Organisation for Migration and the African Continental Free Trade Area Secretariat.
In a statement made available to The Guardian yesterday, in Abuja, Adesina insists that African diaspora has become the largest financier of the continent adding, “and it is not debt, it is 100 per cent gifts or grants, a new form of concessional financing that is the key for livelihood and security of millions of Africans.”
He noted that while remittances have helped to meet financial, food, education and health needs as well as serve as countercyclical sources of finance and social protection; much can be done to better tap into these remittances for Africa’s development.
‘’We must eliminate the ‘’Africa –premium’’ charged on remittances, as the cost of remitting funds to Africa is twice what it is for South Asia. We must tap the massive opportunities offered by diaspora bonds. Diaspora bonds are effective instruments to harness remittances for the development of Africa but despite its great potential, only four African countries —Ethiopia, Kenya, Ghana and Nigeria have successfully issued diaspora bonds often with mixed results because the flow of remittances to Africa is high, rising and stable, it offers huge opportunities to serve as collateral to secure financing for African economies.”
According to him, African countries should securitize remittances to promote investments, especially for infrastructure on the continent stressing that the diaspora can offer a lot more than remittances and investments.
“This is why all governments in Africa should prioritize affairs of the diaspora. African countries should establish ministries of diaspora to give policy priority to the specific needs of the diaspora as well as expand the investment opportunities for them through special incentives’’.