Rwandans living and working abroad are increasingly sending money back home with total remittances last year rising sharply by 23.2 percent despite the negative impact of the global recession.
Remittances have been increasing since 2005 from$42.85million to $139.89 million in 2008, accelerating further to reach $172.40 million last year, statistics from the Diaspora General Directorate under the
Ministry of Foreign Affairs indicate.
The data is collected from commercial banks, money transfer agents like Western Union, Money Gram , MoneyTrans and other informal transfers.
“We have realized that as more companies are allowed to transfer funds the figure has been increasing because initially it was only Western Union. The increase also shows the trust and confidence Rwandans in Diaspora have in their economy,” Ambassador Claver Gatete, the Vice Governor told Business Times in a phone interview on Tuesday commenting on the figures.
With that several government initiatives targeting Rwandans abroad being introduced, Vice Governor said was optimistic that the positive trend would continue.
“Most of them are sending money for investment and some have also approached us requesting to participate in Treasury Bills,” he said.
To encourage and ease repatriation of funds, Gatete said the Central Bank will license more companies involved in money transfer business.
“We are also ready to help them give them information that can assist them to make decisions (investment),” added.
Last year the Rwandan Diaspora together with the National Bank of Rwanda (NBK) finalised plans to establish an investment fund the Rwandan Diaspora Mutual Fund (RDMF) which was adopted by the 2008 Diaspora Retreat.
After its establishment, the Mutual Fund will be invested in treasury bonds, guaranteed by BNR and at a later stage the interest gained from the bonds will be invested in higher risk products such as corporate
bonds and stocks.
However it is also expected that the fund will be invested abroad in the long run, to earn more interest which will then be repatriated back to Rwanda.
Currently the Diaspora has actively involved in community development projects including the One Dollar Campaign and recently launched “Bye Bye Nyakatsi”— a project that aims at constructing modern houses and phasing out grass thatched houses in the country.
Diaspora remittances have become a key foreign exchange earner for Africa with about $5 billion released every twelve months.