LEON ISAACS

IAMTN and DEVELOPING MARKETS

ASSOCIATESUK - Jamaica Investment Forum

29th March 2012

DMA Consultancy Services

• Remittances and Payments– Private Sector: Market Entry,

Diaspora Engagement and Seed Funding

– Public Sector: Remittances Pricing, policy development

• Financial Access and Inclusion– Financial literacy programs– Product Development

• Regulation and Compliance– Experts in PSD, EMI– Advise governments in

safeguarding public funds without stifling competition

Our Consultancy Business

International Association of Money Transfer Networks

• Trade body for remittance companies

• Extensive dialogue with regulators

• Information services• Newsletters• Conferences• Seminars

Remittances Overview: Jamaica

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2007 2008 2009 2010

Flow of FDI and Remittances to Jamaica (USD Mn)

Remittance Inf lows FDI (Inf lows)

REMITTANCES OVERVIEW: JAMAICACountry Profile

GDP 2010: USD 1,1895.2 Million

Remittances as % of GDP 2010: 14%

FDI as % of GDP 2011: 2%

Size of Diaspora: Estimated to be over 2 Million Jamaicans living overseas

Location of Diaspora: UK (London and Birmingham), USA (New York and Washington)

and Canada

Total Savings Jamaican Diaspora: USD 5 Billion

Encouraging Diaspora Investment

KEY SECTORS FOR DIASPORA INVESTMENT

Real Estate

SME Private Sector Development

The Jamaican Stock Exchange

Infrastructure

Tourism

Health

Collective Investment at community level

Remittances are the largest flow of private funds to Jamaica.

Currently main use is for individual consumption

There are a number of tools available for harnessing capital from the Diaspora for more sustainable, productive uses in Jamaica.Tools for Investment

1. Diaspora Bonds2. Mutual Funds3. Collective Investment

Schemes4. Returning Migrants

Diaspora Investment can complement FDI in seeing growth in Key Sectors

JAMPRO have developed coherent Business Diaspora Strategy to encourage Diaspora Investment

Diaspora Bonds

Pre-requisites for issuing a Diaspora Bond: Know Your Diaspora (KYD)

When are the Diaspora likely to Invest? Ghana Kenya

Successful Issuance?

Golden Jubilee

Bond Over -

Subscribed

Kenyan

Infrastructure

bond: Over-

subscribed

Successful Issuance

Ethiopia

Y

Y

Y

N

Y

Large Diaspora in OECD countries

Relative trust in the home country government

Strong ties between the Diaspora and the Country of Origin

Y

IN THE CASE

OF JAMAICA?

The Renaissance Dam

bond DID NOT

MEET TARGET

Ticks all of the

boxes for a

successfully

engaging its

Diaspora

Access to the Diaspora – Effective marketing campaign. NY Y

Did Not Meet

Targets

Y

Y

Y

Y

Y

Y

Y

Government of Jamaica is planning to issue a Diaspora Bond in August to raise $1 billion

Mutual Funds

The Rwandan Diaspora Mutual Fund (RDMF): THE BNR have found a way to use remittances to promote national development.

•Set up in March 2009. The fund is managed in partnership with the Diaspora, the BNR provides administrative and management support.

•To date no figures have been published on how much investment has been raised

Good relationship between the Government of Jamaica and its Diaspora overseas.

Real opportunities to develop a similar fund for SME development in Jamaica.

Collective Investment

Matching Service – factsheet for the Diaspora on investment opportunitiesInvest directly through the website and monitor progress

Raised $1 Million for the Kenyan Diaspora Bond, END OF 2011

4+1 Project undertaken by migrant associations in the USA, Mexican Federal, State and Municipal Government and Western Union.RESULTSSpurred employment and generated commerce in the localities where the investment took place.Collective Investment from the Diaspora into Key Sector that

complements FDI can encourage Growth.

PRIVATE SECTOR LED GOVERNMENT LED

SUMMARY

• Diaspora investment and FDI are not mutually exclusive.

• The Diaspora is a great source of potential investment

• Understanding the Diaspora is critical• There are plenty of potential

investment schemes that can be developed – use global best practice