A blog by Dr Tamara Mughogho, Economic Adviser in the Economic Policy and Small States Section of the Commonwealth.
From remittances to investment
At the end of last year, the Government of the Republic of Kenya launched the inaugural Kenya Diaspora Investment Strategy (KDIS), marking a significant step toward shifting from remittances primarily used for consumption to unlocking greater diaspora investment. The launch also represented the culmination of a journey shaped by a broad coalition of stakeholders and a whole-of-government effort to define the actions that will strengthen diaspora participation in Kenya’s growth. The Commonwealth Secretariat is proud to have provided technical support towards the development of this strategy from its very inception and to witness it now moving into the implementation phase.
Why this strategy matters
Remittances to Kenya have grown steadily in recent years. By 2024, they reached an all-time high of USD 4,945 million, an 18 per cent increase from USD 4,190 million in 2023 (Central Bank of Kenya, 2025). Remittances are now Kenya’s largest source of foreign exchange, surpassing traditional earners such as tea, coffee and tourism. While these inflows play a vital role in supporting household consumption, they also signal a much larger opportunity.
The Kenyan diaspora has significant potential to contribute more directly to investment and national development. Increased diaspora investment could generate strong multiplier effects, including new enterprises, expanded economic activity and job creation. A 2018 Commonwealth survey highlighted strong interest among the diaspora in investing in Kenya, while also identifying barriers such as limited access to information, high remittance costs, trust concerns and complex business processes (Commonwealth, 2018). The Kenya Diaspora Investment Strategy provides a structured framework to address these challenges and sets out a clear roadmap to enhance diaspora investment.
Kenya has already made progress in advancing diaspora engagement, including the establishment of the State Department for Diaspora Affairs in 2022 and the launch of the National Diaspora Policy in 2024. However, constraints remain. In response, the KDIS articulates a clear vision: to increase both the quantity and quality of diaspora investment in Kenya in support of inclusive development.
To achieve this vision, the strategy outlines five strategic goals:
- Building trust and enhancing diaspora investments.
- Expanding diaspora investment alternatives
- Enhancing awareness of investment opportunities
- Improving the business environment for diaspora Investment
- Establishing a diaspora investment protection framework
The strategy also identifies priority sectors with strong potential for diaspora investment, including technology and innovation, agriculture and agribusiness, renewable energy, tourism and hospitality, manufacturing, healthcare, the digital superhighway and the creative economy.
The Commonwealth's role in developing the strategy
The development of the KDIS began in early 2024 following a request from the Government of Kenya. The Commonwealth Secretariat worked closely with the State Department for Diaspora Affairs, particularly the Savings, Investment and Remittance Division, which serves as the custodian and lead implementer of the strategy. Support included drafting and reviewing the strategy, facilitating stakeholder consultations and supporting validation workshops. Close collaboration with a Technical Working Group and consultations with diaspora communities ensured the strategy is evidence-based, inclusive and aligned with Kenya’s national development priorities.
Looking ahead
With the strategy now launched, the focus shifts to implementation. The Commonwealth Secretariat remains committed to supporting the Government of Kenya through capacity building, monitoring and evaluation, alongside strong multi-stakeholder coordination and sustained political commitment. The Kenya Diaspora Investment Strategy reflects the Government’s commitment to meaningful diaspora engagement and safeguarding the interests of Kenyans abroad, while offering valuable lessons for other Commonwealth member countries seeking to harness diaspora investment for development.
