Cabinet Secretary for Foreign and Diaspora Affairs Musalia Mudavadi has announced that Kenyans in the Diaspora will have an opportunity to contribute to Kenya’s economic transformation through an innovative dollar bond.
Mudavadi stated that the World Bank’s Multilateral Investment Guarantee Agency (MIGA) and the National Treasury will structure the Diaspora Bond, following discussions with MIGA’s Executive Vice President, Hiroshi Matano.
“We are working on a secure bond that will offer better returns than interest rates in the source markets for our Diaspora remittances,” CSMudavadi said.
“The bond will enable the Government to diversify its public debt mix, reducing our exposure to costly commercial debt.”
MIGA estimates that the annual remittances from Kenyans abroad to their home country exceed $4.3 billion(Sh650 billion). However, the organization believes that their savings in foreign banks might be comparable or even greater.
Following a three-day visit to the US, Mudavadi, also engaged in discussions with Scott Nathan, the Chief Executive Officer of the Development Finance Corporation (DFC), exploring potential investments to advance the government’s economic and social transformation agenda.
He urged DFC to invest in projects with high multiplier effects to stimulate the growth of the Bottom-up Economic Transformation Agenda (BETA) priority sectors.
According to him, investments in infrastructure, manufacturing, and supply chain diversification would unlock Kenya’s potential as a regional logistics hub for the United Nations operations and global investors in the Eastern Africa region.
The US development finance institution, which provides finance and investment guarantees, is collaborating with the National Treasury on climate-friendly initiatives, including smart agriculture, clean energy, and electric vehicles.
“Through its support for a pyrethrum processing project in Nakuru County, the institution has spurred pyrethrum farming, creating opportunities for local farmers to enhance their livelihoods and boosting Kenya’s export potential for organic pesticides,” Mudavadi said.
In another meeting between CS Mudavadi and Chidi Blyden, Deputy Chief Executive Officer of the Millennium Challenge Corporation (MCC), the focus was on expediting the implementation of a transformative urban mobility and growth initiative that will benefit commuters in Nairobi County.
The climate-friendly urban connectivity project, funded by a $60 million MCC grant, encompasses the development of a Bus Rapid Transit (BRT) network, bicycle lanes, pedestrian pathways, crossways, and overpasses.
Additionally, it aims to facilitate the connectivity of matatu stops to the emerging commuter rail network and promote mobility in urban areas.
In September 2023, MCC, an independent US government agency, signed a threshold program agreement with the National Treasury in New York.
The initiative aims to decrease commuter time, thereby promoting economic growth through the increased productivity of workers and manufacturing firms.
