The Bright Continent

In keeping with what I am hearing is a reenergized comittment to diaspora issues at the World Bank (and its new Africa strategy), Managing Director Ngozi Okonjo-Iweala takes to the New York Times to argue for diaspora bonds to standardize African migrants’ long-running subsidy of African economies. It’s certainly worth talking about:

These diaspora bonds would be in essence structured like any bonds on the market, but would be sold by governments, private companies and public-private partnerships to Africans living abroad. The bonds would be sold in small denominations, from $100 to $10,000, to individual investors or, in larger denominations, to institutional and foreign investors.

Preliminary estimates suggest that sub-Saharan African countries (excluding South Africa, which doesn’t have significant emigration) could raise $5 billion to $10 billion a year through diaspora bonds. Countries like Ghana, Kenya and Zambia, which have fairly large numbers of migrants living abroad in high-income countries, would particularly profit from issuing diaspora bonds.

There are precedents for such moves. Greece announced this week that it was preparing to issue $3 billion worth of diaspora bonds in the United States. India and Israel have issued diaspora bonds in the past, raising over $35 billion, often in times of financial crises.

As I’ve written here, the extensive flight of Africans abroad has its advantages.