Remittances to Ho Chi Minh City at a record high of $6.1 billion

The total remittances to Ho Chi Minh City in 2020 increased 12 per cent on-year to $6.1 billion, setting a new record despite the impact of the COVID-19 pandemic.

Remittances to Ho Chi Minh City at a record high of $6.1 billion
Despite or due to the COVID-19 pandemic, remittances to Ho Chi Minh City soared last year

This was shared by Nguyen Hoang Minh, deputy director of the State Bank of Vietnam's Ho Chi Minh City branch. This came as somewhat of a surprise because the figure was initially expected to be $5.5 billion. In the first seven months, remittances reached $3 billion only, down 1.2 per cent on-year. Furthermore, the World Bank for the first time forecasted that the remittances in Vietnam would decrease in 2020.

The growth is doubly impressive in the context of the COVID-19 outbreak which has affected the incomes of overseas workers.

Remittance inflows soared in Ho Chi Minh City at the time leading up to the Lunar New Year, when Vietnamese people living abroad could not return home for the festival due to travel restrictions.

Normally, recipients prefer receiving foreign currency in cash, however, due to COVID-19, they are encouraged to receive Vietnamese currency to their via bank accounts.

Almost all remittances came from the US, Australia, and Canada, which are home to the largest Vietnamese communities, as well as Japan, Taiwan, and South Korea which are the main labour export markets of Vietnam.

Historically, during the 2009 global financial crisis remittance inflows also soared on-year to Vietnam thanks to the increasing number of overseas Vietnamese and Vietnamese people working abroad.

Statistics from the State Committee on Overseas Vietnamese Affairs under the Ministry of Foreign Affairs shows that 5.3 millionoverseas Vietnamese are living in about 130 countries and territories, 80 per cent of whom are in developed nations with a high level of GDP per capita such as the US, Australia, Canada, France, and Germany.

About 3,000 businesses run by overseas Vietnamese have been operating abroad, which also contributes to pushing up remittances to the country.

In addition, about 580,000 Vietnamese labourers are working abroad, also contributing to these inflows.

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