VietNamNet Bridge - Vietnam wants to drive the capital flow from kieu hoi, or overseas remittance, into production and business, rather than spending. 


In 2015, according to the World Bank (WB), Vietnam received $12.25 billion in kieu hoi, a slight increase over the $12 billion it received in 2014. With the amount of kieu hoi, Vietnam is the 11th largest kieu hoi receiver in the world and the third in East Asia & Pacific.

Kieu hoi to Vietnam has been increasing steadily in the last few years. In 1991, only $35 million was remitted to Vietnam, while the figure soared to $12.25 billion in 2015, a high annual growth rate of 38 percent. Meanwhile, according to VietinBank, the majority of kieu hoi were from the US, Australia and Canada. It was estimated that $7 billion came from the US in 2015.

According to Tran Van Trung, director of Dong A Overseas Remittance, about $1.4 billion worth of kieu hoi have gone through the company.

Meanwhile, according to deputy director of the HCM City branch of the State Bank Nguyen Hoang Minh, 40 percent of kieu hoi is remitted from October to January.

In 2015, according to the World Bank (WB), Vietnam received $12.25 billion in kieu hoi, a slight increase over the $12 billion it received in 2014.

There are many reasons behind the sharp increase in kieu hoi in the last few years. First, Vietnam has made great efforts to accelerate financial liberalization, integration and legal reform in the financial sector in general and in money remittance in particular.

Second, attractive investment opportunities have appeared in the last two decades. Third, the Vietnamese community overseas has become larger.

Fourth, the overseas remittance services have been improved with the presence of profuse service providers.

Real estate market attracts kieu hoi

Experts have emphasized the outstanding features of kieu hoi when comparing kieu hoi with other capital sources. 

ODA (official development assistance) is not ‘the gift from the God’. It is just long term capital with preferential interest rates. Meanwhile, Vietnam has to pay heavy prices by offering big investment incentives to foreign investors to attract foreign direct investment (FDI). Meanwhile, kieu hoi has a lot of non-refundable capital.

Official reports showed that the volume of kieu hoi injected into the real estate market is on the rise. According to the HCM City branch of the State Bank, about 70 percent of kieu hoi went to production and business, while 21.6 percent went to the real estate sector and 7 percent to cover households’ basic needs.

Bui Quang Tin from the HCM City Banking University predicted that more kieu hoi would flow to the real estate sector in upcoming years because because of the 2014 Housing Law and Real Estate Business Law which took effect on July 1, 2015.


NLD