Rising Remittances From Overseas Vietnamese Boosts Currency Stability

Kim receives around $800 to $1000, depending on the exchange rate, every month from her mother who’s based in the US. Her mom’s a healthcare professional and Kim’s working as a part-time web designer at a startup company in Ho Chi Minh City. 

“I have a job but my mother still sends me a huge amount of money monthly to support our family business and my personal needs,” Kim shared. “My mom’s been working in the US for more than 20 years now, she comes home once every two years and she’s been supporting me and my brother’s family since.” Her mom also sends $500 to her brother’s family every month.

Kim’s mother is just one of the many Vietnamese overseas workers who regularly send remittances to their families back in Vietnam. 

According to the latest report from Bloomberg, the country expects rising remittances from overseas Vietnamese to help keep the currency stable, allowing the central bank to focus on supporting virus-hit businesses and boosting economic growth. 

In 2020, due to movement restrictions applied by many countries over the world, the number of Vietnamese workers going abroad to work was only 78,641.

Deputy head of the State Bank of Vietnam in Ho Chi Minh City Nguyen Hoang Minh said that remittances to the city are expected to reach about $6.5 billion this year, after rising 15% to a record $6.1 billion last year.

“Remittances have surprisingly surged during the pandemic, and significantly helped us keep the dong stable,” Minh told Bloomberg. “Apart from rising remittances, increases in foreign direct investment and exports this year will also help ensure sufficient supply of foreign currency, facilitating our policies in helping businesses cope with impacts from the COVID-19 outbreak.”

“I lost my job in October of last year, since then my mom has doubled the amount of money she sends to us here,” narrated Kim, adding that it helped her survive a jobless life for two months.

The relative impact of the pandemic resulted in different repercussions on the economy and on the personal lives of Vietnamese citizens in the country and abroad.

Last month, the central bank said it will continue to pursue monetary policies to reduce borrowing costs for businesses and boost economic growth while keeping inflation in check. The Vietnamese government wants to make sure the country remains among the world’s fastest-growing economies, and expects 2021 growth to meet its goal of 6.5%.