That’s according to the findings of a new study on Diaspora Investments in the Caribbean presented by the infoDev section of the World Bank. The study, authored by Qahir Dhanani and Mina J. Lee surveyed 850 self-identified members of the Caribbean Diaspora in London, New York, Toronto and Miami from March to June 2013.
The study titled ‘The Caribbean Diaspora: A source for venture investment?’ was part of the Entrepreneurship Program for Innovation in the Caribbean, (EPIC) and found that 32 percent of Caribbean nationals overseas cited social instability, including crime in the region, as the largest barriers to increased engagement with the region.
Thirty percent also said weak legal framework enforcement prevents them from being more involved in the Caribbean.
Of those surveyed, 80 percent held a bachelor’s degree or higher while over 65 were currently employed in the private sector and almost 40 percent owned their own business. A quarter of were found to be affluent with either net investable wealth or annual incomes in excess of USD 100,000 held primarily in cash savings, real estate holdings, or public equity. A small proportion of respondents (8 percent) identified themselves as “accredited investors,” namely having either an annual income of over USD 200,000 during the past two years or at least USD 1 million in investible assets.
The report’s authors, however, concluded that despite the two main barriers to investment, the Caribbean region was still viewed as a destination with a great sense of opportunity and hope among the Diaspora community, which is sizeable, well educated, affluent and largely interested in engaging even more in “back home.”
Most surveyed favored opportunities to not only “touch and feel” the investments being made, but to have an active role – preferring to give directly to family and friends, alma maters, and organizations whom they know and trust personally.
“This is a remarkable finding as it provides clear evidence that Diaspora dollars are already flowing to new ventures in the region and that these come from relatively sophisticated investors. This willingness and ability to engage represents a significant untapped potential for Caribbean nations through reducing the barriers to and improving the avenues for engagement,” stated the report.
“The Diaspora can indeed play an important role in the Caribbean region’s development story – but it will require leadership to lower barriers to engagement, facilitate structured opportunities and increase information transparency.”
