Overseas Vietnamese are no longer just sending remittances to family
Overseas Vietnamese are no longer just sending remittances to family
So where is their dong being invested?
Overseas remittances no longer serve as mere stopgap money for relatives of Vietnamese nationals working abroad. Today, they are being siphoned more into businesses and real estate investments.
Seventy-two percent of overseas remittances to Ho Chi Minh City so far in 2016 went to business and production, while 22 percent went to real estate, according to the state bank’s branch in the city. Around six percent were meant as financial aid to family.
This suggests upheavals in income distribution across the country. Between 2010 and 2013, only 27 to 30 percent of remittances were allocated to business investments, VnExpress reported, citing state bank data.
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Like Filipinos, Vietnamese are among the most ubiquitous workers in the world. Around 90,000 workers leave Vietnam every year for contractual work overseas.
Overseas remittances are a pillar of the Vietnamese economy: equivalent to about 8 to 10 percent of the nation’s GDP. Remittances to Ho Chi Minh City alone are expected to top USD2.5 billion this quarter, bringing the projected tally for 2016 to at least USD5.7 billion, the state bank reported.
Figures last year hovered at USD5.5 billion, outpacing the USD5.2 billion received by the city in 2014. About 222 percent of remittances in 2015 were apportioned to real estate, 70.8 percent into businesses, and 7 percent to relatives.
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Source: Property Report