Diaspora Bonds are a bad idea that refuses to die. They reflect the idea that members of the diaspora are just so many walking dollar bills. For too many Jamaicans the diaspora is a financial resource to be harvested. Instead of mutual respect, the relationship between Jamaica and its diaspora can seem almost predatory.
Jamaica has the largest diaspora, relative to local population, in the world. It sends home billions of dollars a year. In net terms the diaspora is Jamaica’s largest single source of foreign exchange. Furthermore remittance flows are constant. In good times and in bad loyal Jamaican’s find the money to send home. So Jamaican policymakers have long eyed those billions greedily. They lament the idea that these billions are going into mere “consumption” ie school fees instead of “investment” ie government projects.
More recently, the World Bank has taken up the idea. It is not suggesting the renegotiation of the unfair trade agreements that the Caribbean and others have been forced to sign nor has it any interest in further relieving poor and middle-income countries of the dead weight of foreign debt. Instead, the international financial institutions want poor countries diaspora to be corralled into making good their countries lack of foreign investment. Yet it is IMF insistence on cuts in public expenditure and opening up local markets to foreign investors (to the detriment of local business) that have made jobs in Jamaica for trained professional so hard to come by. Accordingly, millions migrate. Now international financial institutions want those same migrants to compensate for the catastrophic failure of IMF policies by investing in diaspora bonds.
Banks, financial institutions and bond salesmen are also keen on diaspora bonds. They know that they will make millions in profits by merely handling the schemes, whether or not the bonds make any serious money for the countries involved. What people forget about financial institutions is that they are not interested in whether the latest scheme they are peddling is actually a good idea. All they want to know is whether, in the short term, they can make money from it. These are the people, after all, who devised the financial instruments based on sub-prime mortgages which nearly crashed the world economy. Yet Caribbean politicians continue to pay heed to the siren call of the World Bank and foreign financiers…
Read more: Diane Abbott, Jamaica Observer