Kenya is losing a significant source of diaspora income as changes to Saudi Arabia’s foreign worker policies affect the number of Kenyans employed in the Gulf country.

Central Bank of Kenya (CBK) Governor Kamau Thugge has linked the sharp decline in money sent home from Saudi Arabia to labour reforms that favour skilled foreign workers over semi-skilled employees. The changes have disrupted one of Kenya’s established employment markets abroad, with the effects now visible in the country’s remittance figures.

Thugge made the remarks on Friday, October 30, 2026, while appearing before the National Assembly Departmental Committee on Finance and National Planning in Machakos. Lawmakers were seeking an update on monetary policy, foreign exchange developments and the state of the Kenyan economy.

According to the Governor, the changes in Saudi Arabia’s labour requirements have contributed to a reduction in the number of Kenyans remaining in the country. The shift has affected the earnings of migrant workers and the amount of money they can send to their families in Kenya.

The latest figures show that remittances from Saudi Arabia have fallen by more than half compared with the same period last year.

Central Bank data puts the value of money sent from Saudi Arabia at approximately $121.45 million (KSh15.76 billion) between January and September 2026, compared with $251.33 million (KSh32.62 billion) during the same period in 2025.

This represents a decline of 51.68 per cent, meaning Kenya received about $129.88 million (KSh16.86 billion) less from the Gulf country over the nine months.

The fall has been linked to Saudi Arabia’s introduction of a new work permit system in 2025. The framework replaced the previous arrangement, which largely treated foreign workers under a common residency and employment permit structure, with a classification system based on qualifications, professional skills, work experience, salary and age.

Under the new system, foreign employees are divided into three groups: highly skilled, skilled and basic workers. The highly skilled category covers professionals such as doctors, engineers, information technology specialists and corporate executives. The skilled category includes technicians, craftsmen and supervisors, while the basic category covers entry-level and manual labour positions.

Saudi authorities introduced the changes as part of efforts to improve productivity and align the country’s foreign workforce with its economic transformation plans. However, the reforms have created challenges for migrant workers whose occupations fall outside the higher-skilled categories.

Many Kenyans working in Saudi Arabia are employed as housekeepers, cleaners, drivers, security guards and casual labourers. These jobs largely fall under the basic category, exposing workers to changes in permit requirements, employment conditions and contract arrangements.

The impact has also been reflected in monthly remittance figures. In August 2026, Kenyans in Tanzania sent home approximately $11.72 million, slightly more than the $11.61 million received from Saudi Arabia. It was the first time Tanzania had overtaken Saudi Arabia in monthly remittance contributions since the CBK began publishing country-specific figures in 2019.

The development marked a major change for Saudi Arabia, which had previously been among Kenya’s largest sources of diaspora income. Between July 2024 and June 2025, Kenyans in the Gulf country sent home approximately $390.6 million, compared with $68.6 million from Tanzania.

Despite the decline in Saudi inflows, other countries have helped cushion Kenya’s remittance market. Money sent from African countries increased by 43.6 per cent to $323.87 million (KSh42.04 billion) in the nine months to September 2026, up from $225.54 million (KSh29.27 billion) in the corresponding period last year.

The United Kingdom also recorded an increase, with inflows rising to $311.67 million (KSh40.46 billion). However, the United States remained Kenya’s largest source of diaspora income, contributing approximately $1.79 billion (KSh232.21 billion) during the period.

Overall, diaspora remittances reached approximately $3.77 billion between January and September 2026, slightly below the amount recorded during the same period in 2025.

Kenya received a record $5.04 billion in remittances in 2025, representing annual growth of 1.9 per cent. The money remains an important source of foreign exchange, helping households meet expenses such as school fees, rent, medical bills and daily household needs.

Remittances also support the country’s external payments position by providing foreign currency that helps meet demand for imports and other international transactions.

Thugge did not disclose the exact number of Kenyan workers who have left Saudi Arabia or lost employment following the labour changes. The available CBK figures measure money transferred through formal channels and do not independently establish how many workers have been affected.

The latest developments have raised questions about the stability of overseas employment markets that Kenya has increasingly relied on to create jobs and generate foreign exchange.