The Finance Ministry in Ghana seeks to raise over $3 billion from Africans in the diaspora to fund community projects in the country. The announcement was made last week by the Finance Minister, Ken Ofori-Atta.
The ministry hopes to raise the fund through the creation of a Diasporan Savings and Investment account also known as the African Sankofa Account.
“So, our expectation is that even if we were to look at the level of remittances that we experiencing which hopefully this year will be over US$3 billion. Our deep feeling is this new account will rival that in a period of a year or two,” a statement by the minister reads.
Ofori-Atta further stated the need for Ghana to look into other alternative means of raising funds while encouraging Africans in the diaspora to own a part of the developmental growth.
At the press conference, the Minister stated that the finance ministry is also relying on the successful Year of Return Initiative announced by the government in 2019 to encourage Africans living outside the continent to invest in Ghana.
The Year of Return initiative was launched in 2018 by President Nana Akufo-Addo in Washington DC to encourage Africans in the diaspora to visit Ghana to mark 400 years when the first slave ship left the shores of Ghana. Promoting investment in Ghana and fostering relationships with African Americans and the African diaspora is one of the key objectives of this initiative.
In addition to the financing of developmental projects, the Ghanaian government also intends to address the problem of increased debts due to its recent borrowing to fund successive budgets with these new moves.
A report by the African Institute for Remittances (AIR) shows that Africa received more than $65 billion in remittances in 2017. With the value of remittances to Ghana each year, the government is encouraging Africans in the diaspora to invest in the bond to make some returns.
A similar initiative was also introduced in Ethiopia in July last year. Ethiopia’s parliament passed a bill to open up the country’s financial sector to an estimated five million of its citizens who have taken other nationalities, including allowing them to buy shares in local banks and start lending businesses. The new law was targeted at enabling the Ethiopian-born diaspora to take part in the economic growth of the country.
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