Remittances dip on exodus
Remittances dip on exodus
Two of Cambodia’s largest financial service providers have reported declines in transactions stemming from key Thai border provinces as thousands of undocumented migrant workers continue to exit the neighbouring country.
Third-party payments and remittance service Wing has seen a 3 per cent decline in the amount of money being transferred to and from users located in five key Thai border provinces, company data seen by the Post show.
CEO of Wing, Anthony Perkins, said that Koh Kong, Pursat, Preah Vihear, Battambang and Pailin provinces saw a combined $1.7 million decline in domestic remittances during June, equaling just 0.5 per cent of the firm’s nationwide volume.
“Out of all five of those, Koh Kong has been the most effected, with about $1 million less in remittances coming out and being sent into the province,” Perkins said.
“That’s a 20 per cent decline for the province compared to usual numbers. It looks like Koh Kong has borne the brunt of the declining transaction numbers after the migrant workers returned.”
Meanwhile, Banteay Mean-chey and Oddor Meanchey actually saw an increase in domestic remittances.
“Maybe this is due to people from other parts of the country sending money and trying to support relatives or friends who have come back over the border and have no work,” Perkins said.
Cambodian workers began flooding back from Thailand in June amid fears of a crackdown on undocumented workers from the Thai junta. Up to 250,000 Cambodians are now believed to have fled the neighbouring country.
The Ministry of Foreign Affairs on Friday cautioned all migrant workers looking to re-enter Thailand to first register for work permits and have valid passports. The ministry announced that new passport-issuing offices will be opened at four locations along the border in Poipet, O’Smach, Cham Yeam and Pailin, in addition to existing offices in Phnom Penh and Battambang.
“You can see that with the government and the Thai junta is trying to expedite the passport and permits process for the workers and get them back in legitimately,” Perkins said.
“It will be interesting to see what our July figures look like, so we can analyse how these new powers are repairing the problem. If they succeed, we would expect to see our remittance numbers recover.”
Cambodia’s largest financial institution, Acleda Bank, has seen similarly marginal declines in domestic transactions stemming from Poipet town in Banteay Meanchey province.
The bank recorded 2,766 transactions for June valued at about $8 million, down from more than $12 million worth in April and $9 million in May, according to Acleda CEO In Channy.
“Poipet has been the most affected by the Thai junta, from our data,” Channy told the Post. “[But] this is a slight impact, not a big impact. It will recover in the coming months and we expect transaction volumes in Poipet to return to the normal levels in July and August.”
Spokesman for the Cambodian Economic Association, Chan Sophal said the impact of the decline in domestic transactions could have wider implications.
“It affects the financial ability of the household concerned and thus may negatively affect the microfinance institutions and the banks who are relying on payments,” he said. “However, I don’t think it can cause something like banking crisis. I anticipate that most of those who returned over the border will find their way back to Thailand.”
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