2. Contents
A. Definition of Key Terms
1.0 Emerging Diaspora Markets
2.0 Diaspora Economy
B. Official Recognition Framework
3.0 World Conference on the Financial and Economic Crisis in 2009 and World
Summit on the Millennium Development Goals in 2010
C. Executive Summary
4.0 Background, Opportunity and Goals
4.1 Background
4.2 Opportunity and Goals
D. Implementation Arrangements
5.0 Our Overall Strategy
5.1 Implementation Team
5.2 Leadership Advisory Panel
5.3 Lead Investment Projects: (Briefs)
5.3.1 A Growth Fund on EDM
5.3.2 EDM Country-Specific Funds
5.3.3 Diaspora Bond Development
5.3.4 A Telecom Alliance
5.3.5 A Creative Industry Alliance
5.3.6 A Banking-Community Partnership
5.4 Campaign
5.5 Research & Policy Development
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3. A. DEFINITION OF KEY TERMS
1.0 Emerging Diaspora Markets (EDM)
Emerging Diaspora Markets or EDM, for the purpose of this document, refers to the ethnic segment of the
population of a high income country, made up of migrants and their descendants, with purchasing power
and a dual sense of obligation and belonging to consume in their country of residence and at the same
time in the country of origin.
2.0 Diaspora Economy
Diaspora Economy, for the purpose of this document, refers to the income or wealth generated by the sum
of expenditures of developing country citizens living in high income host countries as local ethnic
consumers and as international remitters.
B. OFFICIAL RECOGNITION FRAMEWORK
3.0 World Conference on the Financial and Economic Crisis in 2009 and World Summit on the
Millennium Development Goals in 2010
The two most recent international gatherings, the World Conference on the Financial and Economic
Crisis in 2009 and the latest World Summit on the Millennium Development Goals in 2010, have
reiterated a global sense of urgency about mobilizing international private flows towards lesser developed
countries, in recognition that foreign capital flow is a vital complement to national development. Least
developed countries need to mobilize both domestic and external private resources in order to accelerate
economic growth, create jobs, reduce poverty, and make progress towards meeting the Millennium
Development Goals. Most of the emerging markets that do relatively well as far as Foreign Direct
Investment (FDI) per capita is concerned are either natural resource (energy) producers or small tourism
islands. Countries prone to conflict and political turmoil are less attractive to FDI and private equity, and
are by contrast highly reliant on the flow of remittances from their migrants as their most productive and
unfailing source of income.
Leaders at these conferences are committed to accelerate progress in the next five years by bringing
governments together with the private sector to enhance collaboration and effectiveness on projects that
could not be launched or completed without strategic partnerships with key stakeholders across sectors,
industries and regions.
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4. C. EXECUTIVE SUMMARY
4.0 Background, Opportunity and Goals
4.1 Background
Responding to the latest call for global action on international private capital flows, Xen Pi Co. &
Associates has spearheaded two groundbreaking events dealing on the issue. One outcome of those
gatherings is the idea of creating an initiative on Emerging Diaspora Markets (EDM).
Xen Pi’s first event entitled, “Emerging Diaspora Market: Could it be Stimulated to Fuel Capital Flow
between Developed and Developing”, took place on the occasion of the World Conference on the
Financial and Economic Crisis in June 2009. Held in collaboration with Columbia University, the
Business Council for the United Nations, the Governments of Liberia, Benin and the Dominican
Republic, the event served to introduce the world community to a new way at looking at the flow of
capital between nations, with the objective of stressing the need to mobilize and develop the remittance
phenomenon to its full potential.
The second event, “World Forum on the Diaspora Economy”, took place on the occasion of the UN
Summit on the Millennium Development Goals (MDGs) in September 2010. The event shed new light
on the present state of the Diaspora Economy, emerging business opportunities in that segment of
industry, and the economic impact across borders on countries hosting migrants and countries reliant on
their remittances. The event drew support from the Mission of Guatemala, the Mission of Yemen, the
Chairmanship of the Group of 77, the Mission of Nepal, the Chairmanship of the Group on Least
Developed Countries, the Mission of Benin, (host of the very first international conference on
Remittances on the LDCs in 2006), and, finally from the Bureau of the Special Adviser on Africa.
These two events held in successive years mark an essential first steps towards mobilizing nations’
diaspora economies in such a way that new economic linkages are created or enhanced between countries.
4.2 Opportunity and Goals
The potential for new economic linkages is based on an often-overlooked fact: The opportunity exists to
harness the purchasing power of millions of ethnic consumers living in major diaspora host countries like
the United States of America, the United Kingdom, France and Canada, in order to organize nations’
diaspora economy, via capital flow, in such a way as to foster a formal and sustainable network economy
between countries—both developed and developing, but in particular, the least developed. The initiative
on Emerging Diaspora Markets (EDM-initiative) is aimed at engaging the international community and
academia to work in close collaboration with the private sector to capitalize on this opportunity. We
have led the development of the initiative from the start through a series of events designed to lay the
intellectual and network foundation for a portfolio of investments and academic research. The initiative
came together in the interest of all, investment community and international community. The goal is to
develop capacity and promote a whole new asset class of investments alongside traditional foreign flows.
Once established, The EDM-flow will create wealth while serving as a conduit for capital to flow into
many lesser developed countries.
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5. With regards to our business interest in the initiative, in addition to our role as lead developer, we are
committed to turning the initiative into a number of concrete deliverables:
• An EDM growth fund.
• EDM country funds to help member nations to develop “cross-border infrastructures”.
• A vehicle to pool-in diaspora bonds.
• A university-based research program on EDM.
• A portfolio of seed investment projects to develop EDM sectors.
The EDM initiative is based on a simple rationale. Can not the economic power of developing country
citizens living in high-income host countries be mobilized to achieve much more than it already has? At
present, the economic contribution that they make serves as an engine of growth for the host country’s
economy and as a vital source of income for a host of home countries reliant on the financial support of
their migrants.
Products - Services - Investments
Host Country Country of Origin
Emerging
Diaspora
Needs
Market
(EDM)
Capital Flow
Cross-border Infrastructure Investment Channels (Hubs)
Global Investors Consumer-Investors
MODEL OF A NETWORK ECONOMY LINKING COUNTRIES
DEVELOPED WITH DEVELOPING
We have coined the term Emerging Diaspora Market merely to lend identity to a market that, up until this
initiative, existed only in separate realms: Ethnic and Remittance. Emerging Diaspora Market, by our
definition, is the market that is generated by the sum of its parts, equalling to the economic activity output
of millions of developing country citizens living in a high-income host country like the United States, the
UK, and France as ethnic consumers and as remitters. A case in point, in 2006, the diaspora in the United
States sent home more than $100 billion in money transfers while being responsible in the telecom sector
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6. alone for 29% of long distance telephone revenue and 37% of local telephone service revenue. Moving
beyond the telecom sector to consider their overall consumption as ethnics, the market which we seek to
develop is significant. EDM as an evolving concept is rooted in the growing international recognition
that ethnics have long been at the centre of two economies having consistently demonstrated their dual
sense of obligation and belonging to consume in their country of residence and at the same time in their
country of origin.
The emergence of the EDM initiative at the time of global economic slowdown in foreign direct
investment and emerging market private equity around the world coincides with real opportunities to tap
the demand of ethnics in the U.S. market in particular, in the form of products such as food, telecom,
media, entertainment, insurances, real estate, deposit accounts, calling cards, on-line payments, money
transfer, diaspora bonds, mutual funds, and loans. Some of this demand ends with local consumption, but
much of it is “diaspora-originated”, meaning paid for in the country of residence for delivery or end-use
in part in the immigrants’ countries of origin. The growth potential of EDM lies in those kinds of cross-
border transactions. EDM products are poised to connect the savvy ethnic investor with an opportunity
which stretches beyond the point of origination.
The EDM initiative is designed to meet one of the most important challenge facing domestic capital
markets in developing countries today; the lack of market scale and capitalization. The initiative sets out
to prove that the “lesser developed a country, the more attractive can be its EDM to the investment
community”. A quick glimpse at the US-Emerging Diaspora Market relationship points to an untapped
EDM proposition that is poised to have major economic impact on countries across the globe, especially
those that are often overlooked if not neglected by the world’s investment capital market. Although an
EDM investment is diaspora-originated, the business of EDM is transnational. It therefore demands
cross-border infrastructure channels that will benefit both investors and developing countries badly in
need.
We recognize that while government has the primary responsibility for a country’s development, the
private sector—as a driver of innovation, investment and job creation must lead. As such, we, as a
business entity, brings a core of assets to lead the initiative through the paradigm shift that will be
required in order to get governments, donors, and multi-national corporations to effectively align their
efforts to develop emerging diaspora markets.
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7. D. IMPLEMENTATION ARRANGEMENTS
5.0 Our overall strategy
To implement the initiative our strategy involves:
• An implementation team.
• A leadership advisory panel on EDM.
• Development of a portfolio of seed investment projects to develop the sectors.
• A framework for an on-going campaign.
• A framework for on-going research & policy development.
Leadership Initiative Implementation
Advisory Panel Team
Campaign Research & Seed Investment
Policy Projects
5.1 Implementation Team
Our team consists of a loose association of experts and consultants led by Harvey Dupiton. The team is
responsible for the establishment of the leadership advisory panel, a framework for an on-going
campaign, as well as for research & policy, and the incubation of a portfolio of seed investment projects.
In an effort to gather additional resources, we are in the process of recruiting organizations and
individuals, both within diaspora communities and beyond, who are able to provide support worldwide.
Key targets are private and public sector providers of debt, equity, technical assistance, grants, and
guarantees, as well as expert volunteers.
5.2 Leadership Advisory Panel
The Leadership Advisory Panel is currently in formation to involve stakeholders from the public and
private sectors. The panel will be responsible for guiding the development of a specific set of
products and tools, which will enhance private investment opportunities in Emerging Diaspora
Markets.
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8. Examples of products and tools may include, but are not limited to:
o Tools for leveraging public sector financing.
o Model investment policies for investing in EDM.
o Prototypes for new or modified investment and/or financial instruments for EDM.
o Provisions for financial risks mitigation to protect investors and providers of finance (debt
and equity) from political, regulatory, and other risks.
o Recommendations for improving the alignment of state economic and workforce
investment programs.
5.3 Seed Investment Projects (Briefs)
As proof of concept, we have developed a number of business proposals which we are referring to as seed
investment projects to emphasize the core value of each of these proposals as permanent infrastructure-
building channels to make EDM-flow possible across national borders. Below is a brief summary of
these projects and their target development sectors.
5.3.1 An EDM Growth Fund
Target Development Sector: Investment
The project to develop the EDM-investment sector is a growth fund. The fund is in development. It will
be based in the United States and will target investments in three primary sectors: Media and
Entertainment, Telecom and Consumer Products. The fund shall focus on developing hubs (infrastructure
channels) that link major diaspora markets in the US, France, the UK, and other developed countries with
opportunities in developing countries in Latin America, Africa, Asia, and Eastern Europe. The hubs can
take the form of everything from online stores and trading platforms to investment instrument sold in
bond markets.
Status: In Development
5.3.2 EDM Country-Specific Funds
Target Sector Development: Investment
Projects on country-specific funds are in discussion with a number of national stakeholders from both the
private and the public sector. These funds act as incubator for the development of country-based
ventures that channel funds from the international market to entrepreneurial ventures in the countries in
question, and that increase the franchising of international businesses in the target counties.
Status: In discussion for Haiti, Philippines.
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9. 5.3.3 Diaspora Bond Development
Target Development Sector: Diaspora Financing
Diaspora bond projects are country specific. Financing tourism development is the immediate area of
interest -- particularly the development of destinations tailored for the home-bound visitor from the
diaspora. Several vehicles are being explored to streamline the fundraising process within the diaspora
community as a whole.
Status: In discussion
5.3.4 A Telecom Alliance
Target Development Sector: Telecom
The project to develop the telecom sector involves the negotiation of a strategic alliance of telecom
operations and investors in the view to deliver technology, products and services to fill a communication
gap between customers in diaspora markets and their phoneless relatives in the country of origin.
Operators in 16 countries are targeted to be part of the alliance.
Status: In development
5.3.5 A Creative Industry Alliance
Target Development Sector: Media and Entertainment
The project to develop the media and entertainment sector is a strategic creative industry alliance
involving EDM entertainment and social networking hubs. The primary objective of the proposed
network is music—promoting its crossover into mainstream markets.
Status: In development
5.3.6 A Banking-Community Partnership
Target Development Sector: Financial Services & Banking
The project to develop the financial services & banking sector involves bridging the communication gap
and creating business opportunities for small and medium enterprises within the EDM community to act
as a bridge for banking the unbanked. Among the possible results of this project are microlending hubs
that could deliver microlending services along with the telecom services described in 5.3.4 above.
Status: In Development
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10. 5.4 Campaign
The strategy to promote an on-going EDM campaign has already produced two important exploratory
gathering involving governments, the private sector and academia. As we move forward, EDM
development will aim to involve a steadily increasing number of stakeholders from the above listed
sectors as well as from NGOs and trade and business associations.
The initiative will also enter into cooperative agreements with intergovernmental bodies such as the
United Nations, the G-8, the OECD, Development Agencies, international financial institutions,
state-owned enterprises, and academic institutions.
5.5 Research & Policy Development
The strategy to encourage EDM Research and Policy Development is the preserve of academic
institutions such as schools of international affairs, business, communications engineering, political
science, sociology and economics. EDM Research will further the in-depth understanding of the EDMs
and of the policy environments, trade arrangements and technologies that will allow them to thrive.
Considering that most policy attention to date on the interaction of diaspora and financial market
development are focused on migrants and remittance, more has to be done to understand the investment
potential of the diaspora as a consumer market, and as a spur to the development or application of EDM-
enhancing technologies, bonds, and policies.
Main Contact for the Initiative:
Harvey Dupiton
Lead Developer
President of Xen Pi Co & Associates
New York, NY
Tel: 347 453-6079
Email: Harvey@xenpi.com, hdupiton@aim.com
Harvey Dupiton is founder and president of Xen Pi Co. & Associates. During his eighteen-year
tenure at the helm of Xen Pi, he has done extensive works in international affairs and lately
social finance with a focus on ethnic-diaspora markets. He also serves as Secretary General of
United Nations Association Haiti, an organization with close ties to the UN-NGO community.
He is former Chair of the NGO Committee on Southern Africa, a committee of the Conference
of Non-governmental Organizations and was, for a period, a press correspondent at the United
Nations. Mr. Dupiton earned a bachelor degree in electrical engineering in 1989 from Pratt
Institute of Technology in New York. He has been recognized as a business champion of the
United Nations Global Alliance on ICT for Development (UN-GAID) for his tireless work on
promoting ICT and his dedication to lure investments in that sector in countries with low telecom
and internet density.
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