CENTRAL BANK OF KENYA
Remarks by
PROF. NJUGUNA NDUNG’U
GOVERNOR
REGIONAL COURSE ON THE METHODOLOGY OF COLLECTION,
COMPILATION AND ANALYSIS OF INTERNATIONAL
REMITTANCES STATISTICS

Hilton Hotel, Nairobi
Monday, November 17, 2014

Dr. Sehliselo Mpofu, Director, Macroeconomic Management
Programme – MEFMI;
Distinguished Facilitators and MEFMI Staff;
Delegates;
Ladies and Gentlemen:
It is a privilege for me to join you on this important occasion of
the official opening of this regional course on “Methodology for
Collection, Compilation and Analysis of International
Remittances Statistics”.
Allow me from the onset, to extend a cordial welcome to you all
on behalf of the Government of Kenya. We are indeed honoured
and happy to host this important activity here in Nairobi,
Kenya.
I would like also to extend a very special welcome to the
delegation from MEFMI. We are honoured to host one of your
capacity building events this year. As always this has attracted a
high level of interest and attendance, an indication of the
perceived need to bridge the existing capacity gaps in the
compilation of remittances statistics.
Let me also thank the distinguished resource persons, Dr.
Emmanuel Kumah, who was formally of the IMF Statistics
Department, and Mr. Moris Mpofu from the Reserve Bank of

Zimbabwe for accepting to bring their expertise to this course. I
am confident that their vast knowledge will enable them to share
experiences in this critical policy area and contribute immensely
to the enhancement of skills in the MEFMI region.
As you are all aware, international remittances have grown to
become significantly important in providing foreign exchange
and financing. They, particularly, support millions of poor
recipients. We cannot therefore afford to ignore the quality of
data for such an important contributor to economic growth and
development.
Until recently, unlike other countries with significant numbers
in the diaspora, we in Africa have paid little attention to the
role of remittances in our development thinking. This must now
change. There is increasing awareness of the importance of these
remittances due to the fact that, unlike other financial flows,
remittances mostly go directly to households, either for
investment or consumption smoothing. Therefore, they have
important poverty alleviation benefits. The critical questions are
therefore how much of this money is coming into our economies
and through what channels?

In Kenya, for instance, estimates of remittances captured only
from formal channels that include commercial banks and other
authorized international remittances service providers, have
averaged USD118.2 million per month so far in 2014, from
USD107.5 million per month in 2013. This places remittances as
an important source of foreign exchange. Indeed they have grown
exponentially in recent years to surpass some of the major
traditional sources.
In Sub-Saharan Africa, remittances have become one of the
important enablers of economic growth and of poverty reduction.
As such, remittances contributed up to 3% of GDP over the last
five years and to more than 20% of international flows. For
example, in Nigeria, remittances account for more than a quarter
of GDP, while in Lesotho they account for more than 20 percent
of GDP. There are indications that international remittances to
Africa exceed USD30 billion annually, affect 25 million
recipient households, and have the potential to stimulate
economic growth and reduce poverty.
International remittance flows often exceed Foreign Direct
Investment in Africa and account for more than twice as much as
the world’s total Official Development Aid.

In this regard, there is no doubt that the capture of timely,
reliable, accurate and comprehensive statistics is pivotal to the
region’s macroeconomic policy management and deliberate policy
must be designed to attract more inflows from our compatriots
abroad. It is therefore important to increase transparency and
make it easier and more cost effective for remitters to use
legitimate channels, particularly in our region.
While a majority of developed economies are largely compliant
with the acceptable best practices, many developing countries,
including MEFMI member countries still have work to do, mainly
due to inadequate technical capacity among some data compilers.
Without an adequate pool of skilled personnel, our efforts to
bridge the capacity gaps in data compilation in the region will
be futile. The importance of regular capacity building activities,
interactions and sharing of experiences amongst ourselves, and
benchmarking to international best practice therefore, cannot be
overemphasized.
I am happy to note that this course will make an important
contribution to improving our understanding on how to collect,
compile and analyse international remittances statistics in line
with the 6th Edition of IMF’s Balance of Payments Manual (BPM
6) and the IMF International Remittances Guide. This is indeed,

in line with IMF’s and MEFMI’s mandate of imparting hands-on
skills.
I therefore, expect the course to bring together information on key
statistical activities currently undertaken by the statistical
organizations in our respective countries and to identify what
more can be done to further improve the quality and timely
availability of statistics in this area.
May I urge you all to make the most out of this rare opportunity
so that when you return to your respective institutions, you can
take the lead in ensuring that our region benefits fully from this
invaluable initiative. This, however, can only be realized
through individual commitment, free exchange of ideas, sharing
of experiences and a good sense of open-mindedness among all
participants.
It is also my hope that strong networking links will emerge out of
this course to foster a long-run exchange of ideas and experiences
among professionals in the region. Once we have the correct
classification of data, then we can open another chapter of how
to use it in policy making. This will also inform us on how to
target the diaspora to channel investments in specific areas –
like Diaspora Bonds

As I conclude, I appeal to you to take some time out of your
densely packed schedule to enjoy the hospitality of Nairobi.
Freely explore the boundless beauty of our country, sample local
cuisine and explore the attractive tourism products on offer.
It is now my singular honour to declare this course officially
open, and I wish you fruitful discussions and a memorable stay
in Nairobi.
I thank you all for your attention