People who send money to Kenya, Uganda and Tanzania do so for a number of reasons. These can range from helping with school fees, housing and rent costs, buying food or purchasing necessary supplies. In many situations, however, people from east Africa living abroad are able to use their earnings to start businesses back home and improve their local communities.
For years, east African immigrants have worked in diaspora and sent money back home to their families. However, for some of these workers, those savings have enabled them the opportunity to go home and start businesses of their own, The Star reports.
One of the prime examples of this trend is Silas Ngure, who owns a real estate firm in Nairobi. Ngure who one time was homeless has worked in Dubai for five years before going back home to start his company Kilele Homes. Having purchased several pieces of land during this period, it wasn’t difficult to move to next level.
“Look at this place – it’s practically a city now,” Ngure at one of his projects in Syokimau. The company now has plans for Kenyans in diaspora who wish to own a home locally. The facility is basically allowing them to send a fixed amount of money every month for a given period and own the property on completion.
New businesses like these and many others have helped to jump-start a middle class in Kenya and East Africa at large, helping to reduce poverty levels in many parts of the Region.
The motivation
Part of the reason for the recent shift, according to the paper, has been the emergence of money transfer operators facilitating instant remittances to Kenya, Uganda and Tanzania. The region has been more stable in recent years and the economies have opened up to such investments. Now, the remittances sent home can help improve residents’ quality of life instead of just getting them through emergency situations.
A Kampala business owner Rehema Namubiru is another example of the trend. After working in the U.S. for a number of years, she has now moved back home, opened an internet cafe and market and owns her own home. She also told The Star that she felt great pride in the fact that her son is able to use a computer at age 6 – a skill which took him until age 28 to learn.
The paper also detailed stories of other successful businesses run by either returnees or those run by families of east Africans in diaspora. The penetration of mobile money means payments for bills can now be paid from anywhere in the world seamlessly. The key mobile payments in the region include Airtel money, Mpesa, MTN and TigoPesa.
With East African economies receiving more than $3.5 billion in diaspora remittances in 2015, according to World Bank report, the diaspora is proving to be a key component of the region’s growth. Not just in sending money for basic needs but in Long-term investments as well.
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