HCM City has for long been the largest recipient of remittances in the country. It has approved a project to maximize inward remittances from now through 2030. — Photo courtesy of tapchitaichinh.vn

HCM City plans to create funds for overseas Vietnamese seeking to invest in real estate and small and medium-sized enterprises, and buy bonds for funding infrastructure.

They are part of the city People's Committee plan to have policies to maximize inward remittances from now through 2030.

The Committee for Overseas Vietnamese will spearhead implementation of the project and regularly report on the results, challenges and issues and suggest amendments if needed.

It outlines several policies to attract and utilise remittances, including directing them into the financial market (stock market, shares, etc). It sets to establish conduits to channel funds from remittance recipients to businesses, thereby facilitating the transfer of capital from individuals lacking investment opportunities to those with profitable investment prospects.

Other goals are to channel remittances into the privatisation of State-owned enterprises and the sale of public assets and diversify remittance methods to easily transfer funds from countries where large numbers of people of Vietnamese extraction live.

The city will propose to allow foreigners of Vietnamese origin to open bank accounts, and choose between holding deposits in foreign currency or the đồng.

Financial institutions in the city will study the possibility of developing two distinct products, one for overseas Vietnamese to remit money to their families who will have control the account and the other accessible only by the remitters.

There is also a proposal to issue bonds with a five- or 10-year tenor to fund technical, social and economic infrastructure.

According to statistics from the People's Committee, some 2.8 million overseas Vietnamese have links to the city, or nearly 50 per cent of the Vietnamese diaspora.

The US accounts for the largest number of overseas Vietnamese, estimated at over two million, followed by the UK, Australia and Canada.

Besides, major labour export markets such as Taiwan (China, Japan and South Korea are home to a significant number of Vietnamese nationals.

The city has for long been the largest recipient of remittances in the country, accounting for around half annually.

The amount of remittances sent to the city through banks, remittance companies and other legal channels exceeded US$65 billion in 2012-23, and grew at 3-7 per cent.

In the first half of this year it received $5.2 billion in remittances, up 19.5 per cent year-on-year.

They have been a bountiful and consistent source of funds, but the city government recognises there has been a lack of targeted policies and mechanisms to fully utilise their potential. — VNS