African Diaspora Remittances

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The African diaspora refers to a worldwide collection of communities descended from different ethnic African groups. The African Union (AU) defines the African diaspora as consisting "of people of African origin living outside the continent, irrespective of their citizenship and nationality and who are willing to contribute to the development of the continent and the building of the African Union". Its constitutive act declares that it shall "invite and encourage the full participation of the African diaspora as an important part of our continent, in the building of the African Union".[1]

International migrant population numbers have grown exponentially since 2010. Eight in Ten of the fastest-growing migrant populations are from Sub-Saharan African nations. This is according to a Pew Research Center analysis of the latest United Nations data on the number of emigrants, or people living outside their country of birth.[2] Also, according to a United Nations study, there is a strong chance that the third of the world’s population by 2100 will be African.[3]


The African diaspora should be seen as an asset to the world but Africa in particular. This is showcased quite significantly in the area of remittance. Overall, the global remittances market is, as stated by Lee Naik (TransUnion Africa), “the very definition of a sleeping giant”. It is worth more than $600 billion with an estimated $466 billion of that going to developing countries. [4]

By 2017, the World Bank reported that remittances to Sub-Saharan African grew to $37.8 billion, with a forecast of it hitting $39.2 billion by 2018 and $39.6 billion by 2019. Conversely, Africans pay the highest costs in remittance (9.3 percent average, with the global average being 7.1 percent).[5] The reasons for this discrepency are unclear. But the point is to show that the diaspora holds huge economic prosperity, both for Africa and outside of Africa. Remittance is said to be three times greater than foreign aid to Africa.[6] This is seen as a key to financial inclusion.[7]

As per Adams Bodomo, Professor of African Studies (Chair of African Languages and Literatures) at the University of Vienna, Austria, this demonstrates that more than 140 million Africans in the diaspora are remitting far more money to Africa than the development aid funds that are accorded the continent from international donors. This is significant as it challenges traditional ways of approaching the development of Africa’s nations.

Other Contributions from the Diaspora

Other examples of the way the diaspora contributes to the continent are showcased in unique African innovations. Africans studying or working abroad bring a unique set of skills to Africa, while understanding African problems and ways of thinking.

An example of this is IrokoTV, an on-demand Nollywood movie online streaming service. IrokoTV founder, Jason Njoku, realised the huge potential of the diaspora market when he discovered how popular Nollywood is outside of Nigeria.[8] As of 2017, the U.S. remains IrokoTV’s biggest subscriber base, with Nigeria coming in second and the U.K. third.[9]

For Africa, the education and experience disaporians receive outside of Africa’s borders are an asset to the continent, with those skills able to be re-deployed in Africa either remotely or directly. As noted by the World Economic Forum, “Africa is seeing a returning diaspora that recognizes the potential and opportunities in their own countries. This population supports local economic growth with their skills and talent, by acting as “first movers”, investing back in their communities”.[10]

Advantages of Diaspora Remittances and Innovations

Foreign remittance goes directly to people, which means money is flowing directly to people in need rather than through an agency or organisation. This is significantly better than Overseas Development Assistance (ODA) and other types of foreign aid funds which have been known to be misappropriated at all levels - including governmental and non-governmental levels.

As noted by Moyo (2009), there are myriad inefficiencies related to foreign aid with official corruption that can be involved in foreign aid funds management. There are estimates showing that, in some cases, less than 10% of ODA funds actually get to benefit the most vulnerable populations, 90% or so going into the pockets of government officials and even foreign aid workers who are sometimes paid huge sums of money for their personal benefit while they are surrounded by the poverty they are supposed to be eradicating.[11]

Remittances flow directly to the needs of the people and are used to pay school fees, build houses, grow businesses, and so on. The development of payment apps where the payer can directly pay for school fees and groceries, often using the M-Pesa platform, is important in this regard. Foreign aid funds are not usually free and there are conditionalities placed on those who receive the funds. Sometimes, these conditions include structural adjustment programmes, public-sector deregulation, privatisation and even demands for overhaul of the country’s political system before further funds can be disbursed.[11]

Innovations such as those mentioned above are developed by Africans to solve African problems, even if the developers are from the diaspora. This has far better advantages than innovations developed in other nations that work in a particular way which is imposed on African nations and people.[12]

Action required

In 2012, the African Union designated the diaspora as a sixth development zone, the others being West Africa, East Africa, Central Africa, Southern Africa and North Africa. Based on the facts mentioned above, the AU’s sixth zone policy could eradicate the need for foreign aid to Africa. Agenda 2063 [13] is also important in this regard.

There is action required from both remittance itself (the exorbitant fees Africans pay is not justifiable) as well as governmental agencies and policy-makers to take advantage of remittance and offer incentive to the African diaspora to innovate and contribute to the continent. By the year 2030, Africa will have the largest workforce. This can be made into an asset for Africa and the world if proper action is taken right now.