The available literature seems to suggest there are two ways that diaspora influence their home countries. The first and widely known aspect of influence is through financial remittances while there is another aspect of social remittances. Social remittances merit attention for several reasons. Mainly they convey or possibly transfer new ideas, values, beliefs and behaviours as well as also transferring technology and knowledge. They also encompass ideas about gender, race, and class identity.
According to Emmanuel Akyeampong, ‘In the contemporary global context in which African governments are dependent on Western financial institutions for the running of their economies, at the micro-level the economic survival and prosperity of families have become equally dependent on having family members in the Diaspora.’ See further Emmanuel Akyeampong, ‘Africans in the Diaspora: the Diaspora and Africa’, African Affairs (2000), 99, 183-215.
What separates diaspora remittances from aid? The money that members of the African diaspora send to their respective homelands far exceeds aid monies donated by supranational organizations and governments. As of May 2011, annual remittances to the continent have exceeded 40 billion US dollars. According to the World Bank, remittances to sub-Saharan Africa totaled 21.5 billion USD. Secondly, the flow of diaspora remittances is more microeconomic in nature. Whether remittances are sent transnationally or internationally, they are a function of migration being essential to economic well-being. Sowing directly into family members, diasporans are making investments into the well-being of their families.
Moreover, according to the World Bank, remittance flows to developing countries are expected to grow by 6.5 percent this year (i.e. 2012) 7.9 percent in 2013, 10.1 percent in 2014 and 10.7 percent in 2015.
The UN trade and development body stressed that remittances can play a major role in alleviating poverty and as a means of important inputs to boost developing economies.However, UNCTAD noted that with the growing danger of global economic and financial threats, the poorest nations must be ready to review their existing policies on to how remittances should be used to promote industrial development and structural transformation. “This may entail a range of policy interventions, such as domestic and regional development policies aimed at inducing private investments,” the UN report said.“Appropriate financial and regulatory reforms designed to reduce transaction costs and promote greater financial inclusions and credit provision for small- and medium- sized enterprises.”