The diaspora of Guinea transfers hundreds of millions of dollars to the country each year, but these resources are not being utilized effectively. According to Alghassimou Porédaka Diallo, a local development consultant, only 6% of the $616 million sent annually is dedicated to productive activities. This has significant implications for the country's economic development. The majority of the funds are used for consumption, with 61% going towards everyday expenses such as food and 12% financing family and religious ceremonies.
The data on diaspora transfers to Guinea shows a significant increase between 2017 and 2024. According to the World Bank, the country received $44.66 million in 2017, which decreased to $28.43 million in 2018, before rising to $158.13 million in 2019. The inclusion of electronic money and transfer companies in the data collection process led to a significant jump in 2021, with transfers reaching $343.91 million. In 2022, the World Bank recorded $527.28 million in personal remittances, while the Central Bank of Guinea reported an overall surplus of $579.2 million in private secondary income.
The Central Bank of Guinea conducted a survey that revealed the majority of diaspora funds are used for consumption, with only 6% going towards productive investments. The survey also found that many members of the diaspora consider buying a truck, taxi, or motorcycle as productive investments, rather than investing in the primary sector such as agriculture or food processing. This lack of understanding about what constitutes productive investment is a major challenge.
Another issue is the lack of coordination between diaspora associations, local authorities, and development partners. Many projects are implemented without consultation with local communities, which can lead to a lack of sustainability and impact. For example, many villas built by the diaspora remain closed for most of the year, and the funds invested could be better utilized to develop local economic potential and reduce clandestine immigration.
The lack of coordination and understanding between the diaspora and local communities can be attributed to a crisis of trust. Many people in Guinea view the diaspora as an ATM, while the diaspora prefers to finance events or projects that are not necessarily aligned with local development priorities. This has led to a situation where the diaspora is not effectively contributing to the country's economic development.
Alghassimou Porédaka Diallo's organization, Local Development Consulting, is working to address these issues by promoting better coordination and understanding between the diaspora and local communities. This includes raising awareness about the importance of investing in productive activities and promoting a more integrated approach to development.
The consequences of not addressing these issues are significant. The country's economic development is being hindered by the lack of investment in productive activities, and the diaspora's contributions are not being utilized effectively. It is essential that the diaspora, local authorities, and development partners work together to promote more effective and sustainable development outcomes.
Key points
- Only 6% of the $616 million sent by Guinea's diaspora annually is dedicated to productive investments.
