Overseas remittances boost VN’s development
Overseas remittances boost VN’s development
The increasing amount of remittances sent by Vietnamese citizens working abroad has helped the country offset its trade deficit, reduce poverty, and improved the living standards of those receiving it.
Currently, around 4.5 million Vietnamese citizens live and work in over 100 countries and territories across the world.
In 2000, Vietnamese expatriates sent U$41.75 billion home, and this amount rose by 117 percent to touch $3.8 billion in 2005.
The figure has continued to climb, touching $8 billion in 2010, the year the World Bank ranked Viet Nam 16 of the 20 nations that receive the largest amount of remittances. It ranked second in Southeast Asia, after the Philippines.
In 2013, Vietnam entered the list of the top 10 recipients of remittances at $11 billion. It ranked third in Asia and 11th in the world in 2015, at around $13.2 billion.
Between 2002 and 2015, remittances were around 6 percent of the nation’s gross domestic product (GDP), nearly equal to the total foreign direct investment (FDI), which made up 7.7 per cent of GDP, and double the official development assistance (ODA) capital, which accounted for 3 per cent of the GDP.
In 2016, the figure declined, but remittances transferred to the country still amounted to $9 billion.
Around 70 per cent of the remittances go into production and business, and another 20 per cent into real estate.
These remittances have provided Viet Nam a stable source of foreign currency, increasing the national foreign currency reserves, reducing dependence on foreign capital and easing pressure from the USD exchange rate.
Within the country, HCM City leads in attracting remittances. Around 50 per cent of the remittances transferred to Viet Nam go to the southern metropolis, according to the State Bank of Viet Nam’s HCM City branch. The city received $5.5 billion of remittance in 2015, a year-on-year rise of 10 per cent. This dropped to $5 billion in 2016.
More than 80 per cent of the 1,100 overseas Vietnamese-invested enterprises operate out of HCM City.
