Covid-19 impact on remittances negligible

By Thuy Tien January 24, 2021 | 05:00 pm PT

An employee counts U.S. banknotes at a bank in Hanoi. Photo by VnExpress/Giang Huy.

Vietnam received $15.7 billion remittances in 2020, placing it among the world's top 10 recipient countries.

Even with the pandemic forcing many businesses in foreign countries to halt operations, affecting Vietnamese workers and their income, remittances to Vietnam fell 5 percent over 2019, according to the World Bank.

Bank officials have remarked on a shift in motivation behind remittances over the years. Previously the Vietnamese diaspora sent remittances to Vietnam to support their families, but in recent years, they are sent as investment for doing business in Vietnam.

Besides traditional remitting countries like the U.S., Canada, Australia, Germany, the U.K., and France, remittances are also coming in from the East and Southeast Asian countries and territories like Japan, South Korea, Taiwan, Hong Kong, Macau and Singapore.

Many Vietnamese guest workers and women are married to locals in these places.

There are around 580,000 Vietnamese citizens working overseas now, up from 500,000 in 2010, said Nguyen Gia Liem, vice head of the Department of Overseas Labor under the Ministry of Labor, Invalids and Social Affairs.

According to money transfer companies, remittances in 2021 are hard to forecast as it depends on how effective global pandemic control will turn out and how government policies support businesses and individuals.

The World Bank has forecast that global remittances could drop 14 percent this year due to the global economic recession triggered by Covid-19 and continued border closures. In such a scenario, it is likely that remittances to Vietnam will not grow in 2021.