By Daniel Mwamba
In 2000, Elizabeth left Zambia, to seek opportunity in the UK. She left her 2 children and 2 nieces with her widowed mother. 12 years later, Elizabeth remains the main lifeline for her extended family back home.
What Elizabeth can afford from her wages as a health worker, working in a Care home, she sends home to support her family. It’s usually £150 to £200 each month and the only income the family has back home. Just last year, she completed building a house for her family in Lusaka. When her mother was very sick and needed expensive surgery in a private hospital, she scraped together the money to cover the operation. She considers it her responsibility.
Elizabeth says, “life is hard here in the UK but at the same time, you have to remember those back home.”
Just think of the numbers, if there are 100,000 Zambians in the Diaspora, and like Elizabeth each one sends £200 pounds every month, £2,400 per year, that will be a staggering £240,000,000 (£240 million) annually remitted by Zambians in the Diaspora. Is this not serious investment for the Zambian government?
The World Bank said that in 2010, Zambians in Diaspora remitted more than $350 million to support the families they left behind. That’s more than all the money Zambia receives in international aid from donors yearly, more than all the money local Zambian workers earn in Zambia.
When the world population passed seven billion in October 2011, the UN Population Fund dedicated an entire chapter of its State of the World Population report to issues around migration. It noted the absolutely staggering amount of money immigrants around the world send back home.
The World Bank estimates that, by 2013, more than $404 billion will be travelling around the world every year from immigrants back to their families. That’s almost three times more than all the developed countries in the world put together spent on international aid in 2010.
The Hudson Institute, an American think tank, reports that these remittances play a key role in fighting poverty in developing nations. Those who receive money from family abroad tend to have a better quality of life and are better able to survive shocks like natural disasters.
With tough economic times forcing many donor countries to scale back on international aid, Zambians in Diaspora can be even more effective tool against poverty? Yes, through Diaspora bonds.
Most Zambians are familiar with Bank of Zambia government Bonds. You buy them from the Bank of Zambia and when you redeem them months or years later, you get your money back with interest. It’s a great way to save money, and it creates revenue our government can use to provide the services we rely on, like health care.
Diaspora bonds work the same way. Zambia is one of the few countries that have not sold Diaspora bonds. Countries like Ethiopia have sold Diaspora bonds to their immigrant communities living abroad.
The Diaspora bonds are not new. Israel was the first to issue them in 1951 and in the past the governments of India and Israel have raised over $35 billion dollars, often in times of liquidity crisis. Other countries like Kenya, Zimbabwe and Nigeria have recently begun to issue bonds. Greek immigrants are now looking to Diaspora bonds as a way to save their homeland from its massive debt crisis.
The World Bank offers one example of how Diaspora bonds could be employed to aid development. There are more than 1.5 million Haitian immigrants living in Canada, the U.S. and France. If 200,000 of them each bought $1,000 in bonds, they would raise $200 million to support post earthquake reconstruction in Haiti.
Preliminary estimates by the World Bank suggest that Sub-Saharan African countries can potentially raise $5-10 billion per year by issuing Diaspora bonds. Zambia has been highlighted as one of the countries that can potentially consider Diaspora bonds including Ghana, India, Jamaica, Kenya, Mexico, Morocco, Nepal, Nigeria, Pakistan, Philippines, Romania, Senegal, South Africa and Zimbabwe (and also Greece, Ireland, Italy, South Korea and Spain).
Diaspora bonds can be a creative opportunity for Zambia not only to increase resources for development, but also empower Zambians abroad to help their families back home.
President Michael Sata recently told Zambians in Ethiopian that Zambians living abroad should emulate their counterparts in other countries who send wealth back home to contribute to national economic development little did he know that those countries first had to recognise the power of their Diaspora .
At the moment, the current Zambian government including the ones before, offer little more than rhetoric and still has no strategy of engaging its Diaspora in serious dialogue to solve Zambia’s problems.