Kenyans living and working in Tanzania sent more money home than their counterparts in Saudi Arabia for the first time in August, coinciding with new foreign-worker rules in the Gulf kingdom that disrupted earnings and cash transfers from one of Kenya’s biggest diaspora markets.
Cash sent home from Tanzania hit a record $11.72 million (about Sh1.52 billion) in August, Central Bank of Kenya (CBK) data shows, narrowly surpassing the $11.61 million (about Sh1.50 billion) sent from the Middle East economic powerhouse.
This marked a dramatic reversal in Tanzania’s performance, which had been significantly smaller than Saudi Arabia since the CBK started publishing remittances by source country in 2019.
The data, which captures transfers through formal channels, show the flows from Kenyans in the Gulf country fell 28.7 percent from $16.30 million (Sh2.11 billion) a year earlier, while Tanzania’s jumped 72.3 percent from $6.80 million (Sh880.60 million).
The changes come as Riyadh implemented a new system for foreign workers that replaced the decades-old one-size-fits-all iqama arrangement with classifications based on skills, qualifications, experience, salaries and age.
The framework divides foreign workers into highly skilled, skilled, and basic categories. These changes are aimed at boosting productivity and aligning labour deployment with the country’s economic transformation agenda. Reclassification of existing workers began on June 18, 2025, with enforcement starting on July 5. Recruits entered the system from August 3.
Many Kenyans in the Gulf kingdom work as housekeepers, cleaners, drivers, security guards and casual labourers.
CBK Governor Kamau Thugge said in February that changes in labour policies there had slowed inflows, although he expected the disruption to be temporary.
“There were some changes in labour laws and relations in Saudi Arabia. Saudi Arabia has become one of our largest sources of remittances but with those changes in labour policies, there has been slow down in remittances from there,” Dr Thugge said adding: “We expect that this will not be permanent and, therefore, there would be some recovery later in 2026.”
The latest figures show diaspora remittances from that corridor were yet to recover by August. Monthly cash wired home from Saudi Arabia was above $28 million (Sh3.63 billion) between January and July 2025, peaking at $37.23 million (Sh4.82 billion) in March.
They then fell to $16.30 million (Sh2.11 billion) in August and remained below $19 million (Sh2.46 billion) for the rest of last year.
The decline continued into 2026, with the monthly flows falling to $11.89 million (Sh1.54 billion) in June before dropping further in August.
Tanzania, meanwhile, recorded a sustained increase, with August inflows more than double the $5.25 million (Sh679.88 million) recorded in June 2025 and 72.3 percent above the level a year earlier.
The shift in August is significant because the Gulf kingdom had historically been a much larger source of diaspora cash, beating the UK to become the second biggest corridor after the US in 2023 and 2024.
Between July 2024 and June 2025, Kenyans working there sent about $390.6 million home (Sh50.58 billion), compared with about $68.6 million (Sh8.88 billion) from Tanzania.
Over the following 12 months to June 2026, the diaspora inflows from Saudi Arabia fell to about $198.1 million (Sh25.65 billion) while Tanzania increased to about $90.3 million (Sh11.69 billion).
The CBK data indicate the average monthly contribution from the Gulf country nearly halved over the period, while Tanzania’s continued to rise. The US remained the biggest source despite a 15.4 percent year-on-year fall in August to $205.22 million (Sh26.58 billion).
Other markets recorded strong increases, with Australia rising 53 percent to $30.23 million (Sh3.91 billion), Canada increasing 52 percent to $20.69 million (Sh2.68 billion) and the United Arab Emirates jumping nearly 70 percent to $17.44 million (Sh2.26 billion).
The United Kingdom rose 25 percent to $38.82 million (Sh5.03 billion), while Germany increased 17 percent to $17.51 million (Sh2.27 billion).
Total remittances rose 6.03 percent to $451.85 million (Sh58.51 billion) in August from $426.13 million (Sh55.18 billion) a year earlier, showing that stronger flows from other diaspora markets are cushioning declines in the US and Saudi Arabia.
