Policies for promoting diaspora investment in countries of origin

Abstract

Investments from the diaspora and transnational entrepreneurship represent significant areas for potential contribution to national development. Due to the fact that diaspora members have the ability to connect with a wide range of potential partners and supporters in both their countries of origin and countries of residence, and thus create opportunities for investment, trade and outsourcing, developing countries which seek human and financial capital should put more focus on facilitation and promotion measures for collaboration with the diaspora. The main aim of this paper is to define and discuss most commonly used policy measures for promoting diaspora investments and transnational entrepreneurship in developing countries and giving recommendations for diaspora engagement. The analysis indicates that policy measures and the degree to which countries have begun to engage their diaspora vary, while most of them still miss an adequate institutional framework for promoting transnational networks which can be an important channel for fostering business development, job creation and innovation.