Diaspora bonds for funding education

Abstract

Diaspora bonds represent a debt instrument issued by a country – or potentially a private corporation – to raise financing from its overseas diaspora. They offer governments a flexible mechanism for raising large scale funding to support national budgets and fill financing gaps in development programs, including provision of quality education. However, there is limited awareness about this financing vehicle. While India and Israel have been at the forefront in issuing diaspora bonds, many other nations also have large diaspora communities in the world and could benefit by issuing such bonds. Given the interest of the global education community in innovative approaches to financing, diaspora bonds could be an important source of funding. The paper proposes a pilot program for funding via diaspora bonds a medical school in a developing country with a large and skilled diaspora abroad.