Remittance inflows to HCM City in the 11 months of this year reached US$4.55 billion, Nguyen Hoang Minh, deputy director of the State Bank of Viet Nam’s HCM City branch, said.

According to Minh, the US, Australia and Canada remain the largest sources of remittances to the city. Money sent by Vietnamese workers in China, Japan, South Korea and Southeast Asian countries have increased, but by insignificant amounts.

As much as 72 per cent of the money sent from abroad has been poured into production and business, 22 per cent into real estate and 6 per cent has been spent on personal items, Minh said.

Minh estimated that remittances to HCM City will likely reach $5.2 billion in 2017, up 4.5 per cent from last year. The amount is slightly down from Minh’s own prediction few months ago. In October, Minh projected that remittances to the city, which normally accounts for around a half of remittances to Viet Nam annually, could reach $5.7 billion this year.

Experts attributed the projected decrease of the city’s overseas remittances by the end of the year mainly to pressure from the US Federal Reserve System’s (Fed) policy to hike interest rate the next time. This will affect the supply of remittances from the US, which accounts for the majority of total overseas remittances into Viet Nam.

Overseas remittances into Viet Nam have been constantly increasing since 2010 and reached a record high of $13.2 billion in 2015, but then decreased by 33 per cent in 2016.

However, not only Viet Nam, but several other developing countries have also witnessed a decline in overseas remittances. According to the latest report of the Word Bank, India had the highest overseas remittance inflows in 2015, but these inflows were reduced by 5 per cent in 2016. Similarly, Bangladesh, Pakistan and Sri Lanka also reported a decline in overseas remittances of 3.5, 5.1 and 1.6 per cent, respectively. — VNS