Illustrative image (Source: VNA)
Hanoi – The increasing amounts of remittances sent back to the homeland by overseas Vietnamese over the past few years have helped the country offset its trade deficit, reduce poverty, and improve living standards of recipients.
Currently, nearly 4.5 million Vietnamese people are living and working in over 100 countries and territories around the world.
In 2000, Vietnamese expatriates sent 1.75 billion USD to the homeland, which went up 117 percent to touch 3.8 billion USD in 2005.
The volume continued climbing to 8 billion USD in 2010. Also that year, Vietnam was ranked 16th out of the 20 nations receiving the biggest amounts of remittances by the World Bank, and the second in Southeast Asia, after the Philippines.
In 2013, Vietnam entered the top 10 recipients of remittances with 11 billion USD. The country was ranked third in Asia and 11th in the globe in attracting remittances in 2015, with over 13.2 billion USD.
In the 2002-2015 period, the flow of remittances was equivalent to 6 percent of the nation’s gross domestic product (GDP) and nearly equivalent to foreign direct investment (FDI) which made up 7.7 percent of GDP, and doubling official development assistance (ODA) capital that accounted for 3 percent of GDP.
Despite a decline, the volume of remittances transferred to the country still reached about 9 billion USD in 2016.
Over 70 percent of the remittances are poured into production and business while 20 percent are injected into real estate.
The remittances have helped Vietnam have a stable source of foreign currency earnings, increase the national foreign currency reserves, and reduce its dependence on foreign capital and pressure from the USD exchange rate.
Ho Chi Minh City is leading the nation in attracting remittances. According to the State Bank of Vietnam’s branch in HCM City, around 50 percent of the remittances transferred to Vietnam go to the southern metropolis.
The city received about 5.5 billion USD of remittances in 2015, a year-on-year rise of 10 percent. The figure dropped to 5 billion USD in 2016.
More than 80 percent out of 1,100 overseas Vietnamese-invested enterprises are operating in HCM City.-VNA