Remarks on “Sending Money Home to Africa” IFAD Report

Borany PenhOffice of Poverty Reduction

Global Forum on Remittances

Tunis, Tunisia

October 22, 2009

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Continues international highlight on importance of remittances

New data & perspectives about remittances markets and players

Africa focus, disaggregation by regions & gender Identifies issues requiring multi-stakeholder

attention: private sector, governments, donors, MFIs, regional orgs, think tanks, etc.

Reaffirms importance of rural outreach, financial literacy, capacity building, and innovation

Report’s Contributions

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Follow-on Recommendations

contextualize within global recession and its aftermath

present risks as well as opportunities with change

disaggregate data and analysis within countries

more in-depth research on informal remittances systems in Africa: incentives, actors, integration, etc.

discuss linkages to diaspora engagement & development

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Remittances & Poverty Reduction?

• Poverty reduction impact of remittances ambiguous: consumption vs. investment? reduced incentive to produce and innovate?

• More impact from: improving overall business enabling environment for savings

& investment? complementary partnerships between market actors, ex:

banks & MFIs?

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Diaspora & Development

Remittances are just one form of diaspora engagement…

and P2P private transfers.

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USAID’s DNA Framework

• USAID’s diaspora public-private alliance framework

• DNA: migrants’ connection to homelands

• Enables partnerships between USAID and diasporas through knowledge development, engagement, and operational work.

• DNA mechanisms: ADM & Haitian DM

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Diaspora & Development (2)

• Greater development impact from “Diaspora Direct Investment” or “collective remittances”?

• Most USAID diaspora engagement experience in Latin America

• Need better understanding of other diaspora communities & networks (behavior, risk appetite, resources, etc.)

• New pilot research & development programs, ex: African Diaspora Marketplace

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What is ADM?

• A $2m business plan competition open to U.S.-based African diaspora

• Goal: boost economic opportunities and employment in SSA

• A GDA partnership with Western Union, Ecobank, OPIC, & others

• Learning pilot

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Additional Resources

• www.usaid.gov/gda• www.diasporamarketplace.org • www.microlinks.org • www.povertyfrontiers.org