RemittancesGateway.org

Viet Nam: Remittances set to reach $9b in 2011

Monday, 12 December 2011 14:38

Source: Viet Nam News

Remittances from overseas Vietnamese to Viet Nam are expected to reach nearly US$9 billion this year, a record high and $1 billion more than last year, according to the State Bank of Viet Nam (SBV).

The SBV said that overseas remittances reached $2.5 billion in the first and third quarters of this year and $2 billion in the second quarter.

About 4 million Vietnamese are living in nearly 100 countries and territories around the world. There are also about 400,000 Vietnamese guest workers abroad.

These overseas Vietnamese and guest workers send huge sums of money back home, according to the Viet Nam Academy of Social Sciences. The volume of overseas remittances to Viet Nam made up just 4.2 per cent of the total gross domestic product (GDP) in 1999, but reached 7.8 per cent in 2002 and 7.7 per cent in 2010.

Despite limited Official Development Assistance (ODA), Foreign Direct Investment (FDI) and Foreign Indirect Investment (FII), overseas remittances to Viet Nam continue to increase. The SBV said these foreign currency remittances offset nearly 50 per cent of the trade deficit in 2010.

Tran Van Trung, director of Dong A Remittances Company, told Thanh Nien newspaper that despite the global economic crisis, overseas remittances sent through his company in the first 10 months of this year reached $1.3 billion, higher than its yearly plan.

“Remittances are expected to reach $1.6 billion by the end of 2012, a year-on-year increase of 20 per cent,” he added.

According to the World Bank, Viet Nam ranked 16th among countries in terms of remittances received from abroad, and second in Southeast Asia after the Philippines (which received remittances worth $21.3 billion in 2010).

Remittances could help address the trade deficit and improve the balance of payments if the receiving countries adopted proper policies to mobilise this source for socio-economic development, the World Bank said.