Remittances to hit US$5.2 billion this year

Overseas remittances to Ho Chi Minh City is expected to total US$5.2 billion this year, up 4.5% year-on-year, said an official of the State Bank of Vietnam (SBV).

According to Nguyen Hoang Minh, Deputy Director of the SBV’s branch in HCM City, the flows of remittances to HCM City have remained stable and increased monthly since the beginning of this year, reaching US$600 million in October and US$650 million in November.

In the first 11 months of this year, the figure stood at US$4.55 billion, with 60% of the money coming from the US and over 19% from Europe, he said. 

Minh noted that most of the remittances (72%) have gone into production and business activities, in stead of being kept in coffers, spent on daily lives or invested in real estate and property markets as they were in the past. 

Remittances have helped stabilise Vietnam dong and ensure the US dollar supply while enabling the central bank to shore up the foreign reserves and focus on economic growth support policies, he said, noting that Vietnam dong has emerged as one of the most stable currencies in Asia so far this year. 

Huynh Trung Minh, a financial expert, said that remittance flows this year show signs of slight decline due to impacts of the US Federal Reserve’s decision to raise interest rate in mid-2017 and local banks’ move to slash interest rate on US dollar deposits to 0%. 

In fact, remittances to Vietnam increased continuously since 2010 and hit a record of US$13.2 billion in 2015. However, the amount dropped by 33% in 2016, he said.

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