More kieu hoi in 2010, economists say

Financial experts and bankers all predict that Vietnam will have a better kieu hoi (overseas remittance) season this year than in 2009.

Kieu hoi is money sent by overseas Vietnamese to support their relatives. Calculating kieu hoi is a very important task that can partially reveal the foreign currency situation of Vietnam.

Economists have every reason to believe that more kieu hoi will be remitted to Vietnam this year. The global economic crisis has been over and the recovery of economies throughout the world, especially that of the US, will help overseas Vietnamese send more money.

Nguyen Hoang Minh, Deputy Director of the HCM City Branch of the State Bank of Vietnam remarked that kieu hoi remitted to Vietnam in the first five months of 2010 had a satisfactory growth rate compared with the same months of 2009.

The volume of kieu hoi sent through banks in the first two months of 2010, the months of traditional Tet, increased sharply, because overseas Vietnamese like to send help their relatives celebrate Tet.

By the end of May 2010, kieu hoi remitted to HCM City had reportedly reached $1.709 billion, an increase of 32.13 percent over the same period of 2009.

Minh believes that the volume sent through HCM City banks this year will be higher than 2009, which was four billion dollars.

Associate Professor Tran Hoang Ngan, Deputy President of the HCM City Economics University, is also a Member of the National Advisory Council for Finance and Monetary Policies. The professor agrees that 2010 kieu hoi will be higher than in 2009, and that the six billion dollar mark is within reach.

Ngan added that, with the dong/dollar exchange rate on the black market closer to the official exchange rate, more of the kieu hoi remitted to Vietnam will stay in banks and for a longer time.

In the last months of 2009 and early 2010, when the gap between the official and black market exchange rate stood at 300-500 dong per dollar, kieu hoi receivers did not deposit or sell dollars at banks, but instead preferred to sell dollars on the black market to get higher prices.

At Sacombank, the total volume of kieu hoi sent though the bank in the first quarter of 2010 reached $430 million, an increase of 33.5 percent over the same period of the previous year. The bank hopes that the total volume sent through the bank this year will be some one billion dollars, higher than 2009 by 900 million dollars.

The volume of kieu hoi sent through Dong A Bank in the first four months of the year also increased by 20 percent, while the bank hopes to see one billion dollars come through the bank in 2010.

Dautuchungkhoan

Tags: Vietnam finance, Vietnam financial, Vietnam overseas remittance