IFAD and U.S. Department of State combine efforts on remittances for diaspora investments in rural development

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IFAD and U.S. Department of State combine efforts on remittances for diaspora investments in rural development

Joint initiative announced at Secretary Hillary Clinton's Global Diaspora Forum

Rome  and Washington, DC, May 17:  A new partnership between the United States Department of State and the International Fund for Agricultural Development (IFAD) will seek to create ways to help international migrants to invest in agriculture and rural development in their home countries.

The Diaspora Investment in Agriculture (DIA) initiative was unveiled this week by U.S. Secretary of State Hillary Clinton and IFAD President Kanayo F. Nwanze at the Secretary's Global Diaspora Forum. The three-day event is being held in Washington, DC to recognize and celebrate the contribution of diaspora communities to the U.S. relationship with their countries of origin and encourage intra-diaspora collaboration and learning.

The DIA initiative will create opportunities for diaspora investors to stimulate the agricultural sector in developing countries, particularly post-conflict nations and fragile states.

With international migrants sending home more than US$325 billion a year in remittances, they have become among the largest sources of cash and investment for many developing countries, often surpassing official development assistance and foreign direct investment.  The DIA aims to encourage migrants to invest their savings in enterprises that will help strengthen the agricultural sector in their home countries, link farmers with emerging markets, create jobs in rural areas, and contribute to food security.

Addressing several hundred representatives of U.S. diaspora communities at the Forum, Secretary Clinton emphasized that they are a critical resource in international development efforts, particularly in countries facing natural disasters, conflict or other crises. "We know that many of you have stepped in where others are unwilling or unable to help create a business or build a school, or provide healthcare. And I saw the effectiveness of diaspora communities in the work that I've done for many years."

"We want to create new ways for engagement and empowerment in the land of parents and grandparents….. We are working, for example, with the International Fund for Agricultural Development in Rome, which will help us support diaspora investments in agricultural and rural projects," she said.

In his remarks to the Forum, the President of IFAD hailed the enormous impact that the global diaspora community already has on the economies of developing countries.

"While foreign investors avoid fragile communities, diaspora investors are not only better informed about local opportunities, they are willing to invest when others won't," he said.  "The real question is: how can we help diasporas leverage their hard-earned funds?"

"Diaspora communities from developing nations save a total of $400 billion every year. Many would like to support their home countries through investment. Money is not the problem. Good opportunities and clear mechanisms for making those investments are what is required," added Nwanze.

"DIA will help identify opportunities and models for sustainable investment. It will build the capacity of individual investors, diaspora organizations and those implementing projects on the ground. And it will encourage lasting partnerships that achieve financial returns for investors, while fostering stability and opportunity," he stated.

The initiative will target a number of countries, including Afghanistan, Angola, Burundi, Congo, Côte d'Ivoire, the Democratic Republic of the Congo, Egypt, Haiti, Iraq, Liberia, Sierra Leone, Somalia, Sri Lanka, The Sudan and Tunisia.

Press release No.IFAD/36/2011

The International Fund for Agricultural Development (IFAD) works with poor rural people to enable them to grow and sell more food, increase their incomes and determine the direction of their own lives. Since 1978, IFAD has invested over US$12.5 billion in grants and low-interest loans to developing countries, empowering more than 370 million people to break out of poverty. IFAD is an international financial institution and a specialized UN agency based in Rome – the United Nation's food and agricultural hub. It is a unique partnership of 166 members from the Organization of the Petroleum Exporting Countries (OPEC), other developing countries and the Organisation for Economic Co-operation and Development (OECD).