Mobilizing Diaspora Entrepreneurship for Development

Diasporas are in a unique position to have a positive effect on the economy of their countries of origin if policymakers there seize the opportunities. Governments, multilateral institutions, diaspora organizations, and other civil-society groups can help diaspora entrepreneurs tap the resources they need and clear obstacles to realizing their ventures—or at the very least, they can get out of the way. This report examines the diaspora entrepreneurs who are often motivated to contribute to job creation and economic growth in their native lands, and offers some key findings and policy options.

Despite the advantages that these entrepreneurs bring, many developing countries have met only limited success in attracting them. Countries with governments that still require aspiring entrepreneurs to follow complex procedures, countries at war, or those experiencing internal conflict and social upheaval remain unattractive to all but the most intrepid diaspora private investors and business people. Peace, stability, and construction of basic infrastructure are prerequisites for substantial diaspora investment, as they are for so many other development processes.

This report seeks to identify the nature of diaspora entrepreneurship and suggests ways that the U.S. Agency for International Development (USAID) and other donors can constructively promote its developmental impact.