Remittances to turn heads

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The money remitted by overseas Vietnamese and guest workers in the first half of the year amounted to $6.3 billion, or 70 per cent of the total amount last year, according to the State Committee for Overseas Vietnamese.

Meanwhile, the amount of foreign remittances typically sent home in December and January often increase strongly as more overseas Vietnamese return to the motherland during the time.

A large proportion of the remittances in recent years came in the fourth quarter, said Nguyen Hoang Minh, deputy director of the State Bank of Vietnam’s Ho Chi Minh City Branch. Therefore, this year’s result should be substantially higher than last year.

Remittances sent to or through the Ho Chi Minh City alone in the entire 2012, Minh said, were expected at reach $3.4 billion, compared with $3.2 billion last year.

Around 4.5 million Vietnamese, including 500,000 guest workers, live in more than 100 countries and territories outside Vietnam. About two million of them live in the US, where the annual interest rate for dollar deposits is around 0.35 per cent, much lower than the 2 per cent rate in Vietnam.

Given with the interest rate differences, many Vietnamese in the US send dollars back home for their relatives to deposit at Vietnamese banks, according to Dr. Le Tham Duong at Ho Chi Minh City Banking University.

Sacombank CEO Phan Huy Khang said the Sacombank Remittance Company has seen almost $1.3 billion remitted through the company so far this year, a 17 per cent increase year-on-year.

Sacombank expects the whole year’s result to be in the range of $1.6 -1.7 billion as planned.

Meanwhile, DongABank Remittance Company reported a result of $1 billion so far this year.

Vietnam expects this year’s total export revenues to reach $108 billion. If remittances total $10 billion in 2012, it will be almost 10 per cent of the country’s export value.