Summary of PhD thesis: Remittance policy for economic development in Vietnam

The thesis aims at the theoretical basis system of remittance policy for economic development; assess the impact of remittances on economic development; analysis and evaluation of remittance policies for economic development; Analyzing and evaluating remittance policies for Vietnam''s economic development Fourthly, building a policy framework and proposing remittance policy solutions to develop Vietnam''s economy.

STATE BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING BANKING ACADEMY OF VIETNAM 000 TRAN HUY TUNG REMITTANCE POLICY FOR ECONOMIC DEVELOPMENT IN VIETNAM Major: Finance – Banking Code number: 9.34.02.01 SUMMARY OF PHD THESIS HÀ NỘI, 2019 STATE BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING BANKING ACADEMY OF VIETNAM -000 - TRAN HUY TUNG REMITTANCE POLICY FOR ECONOMIC DEVELOPMENT IN VIETNAM Major: Finance – Banking Code Number: 9.34.02.01 SUMMARY OF PHD THESIS Supervisors: ASSOC.PROF.DR LE THI TUAN NGHIA DR NGUYEN THI PHUONG LAN The thesis was defended in front of the thesis committee at … … on 2019 at the Banking Academy of Vietnam The thesis can be found at: - Library of the Banking Academy of Vietnam - National Library HÀ NỘI, 2019 INTRODUCTION THE NECESSITY OF THE THESIS Remittances are becoming increasingly important for the Vietnamese economy Since opening the economy, Vietnam has had policies to loosen remittance flows since 1999 Changes in foreign exchange management policies also create more favorable conditions for capital flows, in general and remittances in particular However, the policies related to remittances are still inadequate, not yet attracting the maximum amount of remittances to promote positive impacts and effective measures to limit the negative impact of remittances For example, the legal framework for receiving remittances is still incomplete, the target system and remittance policy solutions for the subjects are unclear In order to optimize overseas remittance capital for economic development, it is necessary to have a more synchronous and scientific policy system of remittances in accordance with the new situation and situation In the above context, the study of the topic: "Remittance policy for economic development in Vietnam" is necessary LITERATURE REVIEW 2.1 Literature review in the world The topic of remittance has attracted the attention of international organizations and scholars and policymakers on rich areas The trend of remittance research began to appear at large frequency after World War II when more open regulations on migration and immigration were applied by countries Since then, outstanding studies on remittances can be divided into three main contents: (i) definitions, measurement methods, remittance flows; (ii) factors affecting the decision to send remittances; (iii) use and impact of remittances 2.1.1 Definition, measurement methods and remittance flows The definition of remittances differs between countries, leading to differences in remittance measurement (Kapur, 2003; Worldbank, 2007) Although all acknowledge the development and the increasing proportion of remittances sent from relatives abroad, the definition and methods used to measure remittances are not the same in all countries Some countries not publish or publish part of official remittance data, while others only publish data from money transfer companies The difference between investment and remittances is also relatively unclear These inconsistencies lead to statistical issues and comparisons of remittances between disadvantaged countries (Worldbank, 2007) 2.1.2 Factors affecting remittances Regarding factors affecting remittances, previous studies divided the factors into two levels: macro and micro In terms of macro level, factors include the macroeconomic situation of sending and receiving countries such as interest rates, exchange rates, inflation, etc (Lucas and Stark, 1985) Wahba (1991) also pointed out that government policy, the development of financial intermediaries, the difference in interest rates between the two countries are also macro factors affecting remittances In terms of micro level, studies show that there are main groups of factors, including: (i) culture, (ii) gender, (iii) demographics and (iv) overseas associations 2.1.3 Use and impact of remittances a Remittances, consumption and investment Behavior of remittance is a question that creates debate for scholars studying remittances Some studies show that remittances are mainly used for consumption and it almost does not affect local economic improvement Others argue that remittances are used for development investment such as education and housing - helping to improve human capital and employment and development opportunities for people Specifically, through education, people's qualifications increase, thereby, improving job search opportunities 2 Through investing in building houses, recipients of remittances or people with remittances have better living conditions, at the same time, income opportunities, jobs for local construction workers themselves direction In addition to studies on the use of remittances for education, a number of other studies have learned about the use of remittances for investment and development (Osili, 2004 & 2007; Woodruff and Zenteno, 2007) In relation to the use of remittances for business investment and development, Woodruff and Zenteno (2007) find international migration (between the US and Mexico) increasing investment by 35-40% In particular, the authors found out through remittances, households receiving remittances may have capital to develop their business with a small business model (less than 15 employees) Finally, Osili (2007) tested the level of remittances and savings in Nigiria affected by emotional factors, insurance engines The author pointed out that remittances into Nigiria are driven by sentimental factors when remittances increase when household assets (land) decrease However, savings in Nigeria are largely determined by the investment motivation because savings have a positive relationship with household assets b Remittances and economic growth Studies on the impact of remittances on economic growth through consumption channels and investment can be divided into two groups, of which the first group focuses on research at the multinational level, the other group studies within a country The trend of research results remains a controversial issue due to differences in methods as well as data collection c Remittances and multipliers impact Researching the scope of remittances to other variables in the economy is an important topic to determine the influence of remittances In a study on micro-rural data, Taylor (1995) examined the direct and indirect impact of remittances on a village in Mexico The author found remittances with a multiplier effect of 1.6, meaning that every million dollars of remittances sent to the village would generate 1.6 million dollars in extra products In another study in Mexico, Taylor and Dyer (2009) used a general equilibrium model to conclude in the short term, every 10% increase in the number of migrants returning to the country resulted in a 5% increase in wages rural areas and 52% increase in investment in education In the long term, every 10% increase in return of migrants leads to 1% increase in rural income, 52% increase in investment in education and 15% increase in housing investment d Remittances, poverty and inequality Some studies have discussed the relationship between remittances, poverty and inequality Most studies have shown that remittances work to reduce poverty in developing countries (Adams and Page, 2005; Acosta et al., 2006; Loksin et al., 2007; Adams, 2006) In contrast, the relationship between remittances and income inequality is still controversial Many studies show that remittances only have a small effect on income inequality (Barham and Boucher, 1998; Adams, 2006), however, some also confirm the opposite (McKenzie and Rapport, 2007; Jones, 1998) e Remittance and financial development The relationship between remittances, increasing the level of access to finance and financial development in countries is also much concerned However, how remittances affect financial development is still a question that challenges scholars Previous studies have mainly described the relationship between remittances and financial development, and given that remittances will act as a catalyst for financial development when helping remittances to reach households with financial and credit products In addition, remittances can impact banks' readiness in lending to households or areas that receive many remittances 2.2 Literature review in Vietnam Remittances have played an important role in the economy, especially in developing economies like Vietnam Since 1999, the strong growth of remittance sources to Vietnam has caused issues of this capital source to receive more and more attention from researchers Some examples of typical studies on remittances such as Le Minh Tam and Nguyen Duc Vinh (1999), Nguyen Anh Dung etal (2005), Dang Nguyen Anh (2005), Hernández-Coss ( 2005), Sakr (2006), Pfau & Giang Thanh Long (2006), Nguyen Thi Thuy Linh (2006), Nguyen Duc Thanh (2007), Do Thi Duc Minh (2007), Do Thi Kim Hao etal (2013), Nguyen Kim Anh etal (2017) These studies can be classified into main groups including: (i) descriptive statistics studies; (ii) studies using quantitative models 2.3 Research gap First, in theory, previous studies have not clarified the definition of "remittance", especially comparing the term "remittance" used in Vietnam with the term "remittance" used in countries speaking English This will make it difficult to develop remittance management policies Second, the previous study approached the system of remittance management policies according to the objectives (attraction, management and use), but such a division may cause some policies to overlap between groups Therefore, access to remittance management policy system in the new direction, such as supply and demand in three phases, can help solve this problem Third, except Hung (2016) who interviewed Vietnamese people who mainly reside in the US, previous studies on Viet Nam's remittance issue have not yet done qualitative analysis through in-depth interview data Fourth, on the channel of overseas remittance services, previous studies, although there have been analyzes on overseas remittance channels in Vietnam, only stop at organizations with large transactions Fifth, according to the latest research results from Nguyen Kim Anh et al (2017), Vietnamese labor export priorities give priority to using the first remittance for debt repayment This proves that outstanding loans to export labor are relatively large, but many credit institutions now announce that the export surplus of labor has decreased significantly This situation poses a gap in the study of the relationship between remittance flows and credit for workers going to work abroad Sixth, previous studies on remittance policies often focus on public policy Private remittance policies are applied by organizations that receive and pay remittances that have not been systematically investigated and analyzed RESEARCH OBJECTIVES The topic of "Remittance policy for economic development in Vietnam" aims at four objectives: First, the rationale system of remittance policies is aimed at economic development Second, assess the impact of remittances on Vietnam's economic development Third, analyze and evaluate remittance policies to serve Vietnam's economic development Fourth, develop a policy framework and propose remittance policy solutions to develop Vietnam's economy 4 SUBJECTS AND SCOPE OF RESEARCH 4.1 Research subjects The main research object of the dissertation is (i) policies of management agencies on remittances; (ii) remittance policy in Vietnam; and (iii) the impact of remittance policy on Vietnam's economic development 3.2 Research scope - Scope of research on space: remittance policy in Vietnam - Scope of research on time: 1996 - 2018 period For qualitative analysis, the topic uses data from in-depth interview techniques and focus groups in 2018 and 2019 For quantitative analysis, due to limitations on secondary data, especially data on remittances in Vietnam, the research period for quantitative analysis in the VECM model lasts from the first quarter of 1996 to the fourth quarter in 2016 For the PSM model, due to the characteristics of the data from the 2016 VHLSS, the research data is a cross-sectional data type at the time of 2016 RESEARCH DESIGN 5.1 Research Strategy There are two strategies which are survey and secondary database For survey strategy, a three-period supply-demand model is utilized for identifying sample The first stage is senders sending money to an intermediary The second stage is that intermediary sending money to another one The last stage is money transfering from the last intermediary to the users/recievers The three-stage supply-demand model would be benefit to understand remittance policy, remittance in institutions manner in the world and Vietnam For secondary database stategy, firstly, annual Worldbank reports are the best resource Secondly, the quarterly volume of remittance would be collected from Nguyen Kim Anh etal (2017) and State Bank of Viet Nam Thirdly, data from VHLSS 2016 is used 5.2 Analysis Framework Remittance policy Objectives Content Tools Supply Intermediary Demand Remittance Senders, Sending Nations, Types, Personal/collective Channel Use, Personal/Institutions Carling (2004) Consumption K Saving L Investment TFP Economic Development Hàm sản xuất CobbDoughlas Macro: GDP Micro: Income, Poverty, Expenditure 5.3 Research Methodology The thesis used various methods and tools to cope with the research objectives Traditional ones are survey, statistic, compare, synthesis while the mordern ones are modelling issues into simple mathematical formulas, tables and diagrams Firstly, for the objective of the system of theoretical basis on remittances, the policy of remittance management to serve economic development, research uses methods of synthesizing remittance policies applied in receiving large remittances countries around the world Secondly, to assess the impact of remittances on economic development in Vietnam, the topic approaches two quantitative methods (VECM, PSM) and qualitative one (in-depth interview techniques in fieldtrips) Thirdly, for the purpose of assessing the situation of remittance management policies in Vietnam, the topic will approach the three-phases demand - supply, and use qualitative methods through intensive interview techniques management agency 5 Fourth, to design and propose remittance policies for economic development in Vietnam, the thesis is based on international lessons learned from countries receiving remittances in the world, orientation of foreign exchange management including remittances in Vietnam, characteristics of Vietnamese overseas, the result of in-depth interviews with Agribank's customers and quantitative models of VECM In addition, in-depth interviews from officials of relevant management agencies (SBV, Department of Overseas Labor Management, General Department of Customs, Overseas Vietnamese Committee and Ministry Diplomacy) will also be analyzed NEW CONTRIBUTION a Theoretical Contribution - Clarifying remittance definition in terms of languages, especially the model of threeperiods supply – demand, thus, diffrenciating public statistics in remittance provided by Worldbank and State Bank of Vietnam - Presenting objectives, contents and tools of remittance policy for economics developement - Classifying remttance into various norms based on the three-periods supply – demand model, enabling policy makers to opt diversified policies related b Practice Contribution - Building remittance policies in system for Vietnamese economic development - Building a system of solutions and recommendation for Vietnam policy makers to leveraging remittance benefits c Methodology Contribution - Analysing remittance policies via the model of three-periods supply – demand, creating institutional model for managing remittance in Vietnam - Collecting primary data via in-depth interview suppliers, intermidiaries and users of remittances, therefore, providing a vivid picture of remittance behaviors - Testing the impact of remittance on Vietnam economic development via qualitative (in-depth interview) and quantitative methods (VECM, PSM) THESIS STRUCTURE There are three chapters in thesis including introduction, summary and reference list: Chapter 1: Theoretical Framework of Remittance policy for economic development Chapter 2: The current status of remittance policy for Vietnam’s economic development Chapter 3: Solutions on remittance policy for Vietnam’s economic development CHAPTER THEORETICAL FRAMEWORK OF REMITTANCE POLICY FOR ECONOMIC DEVELOPMENT 1.1 OVERVIEW OF REMITTANCE 1.1.1 Migration and Labor Movement If the trend of shifting labor from surplus to the lack of labor is mainly due to income difference, migration trends often occur including two groups of objective causes: (i) instability in the country home origin and (ii) society In particular, social migration is a form of migration that tends to increase today In addition to migrating according to family reunification, a form of social migration is the marriage of foreigners 1.1.2 Remittance definition In this thesis, international remittance is focused According to the supply side, remittances are part of the income of the sender of remittances to the country of origin According to intermediaries, remittances are transfers between countries According to the demand side, remittances are all income of households from foreign countries The remittance statistics should clearly define the collection method to transparent remittance data 1.1.3 Remittance classification Remittance classification plays an important role in managing and proposing remittance management policies for appropriate economic development The criteria for classifying remittances are based on supply-demand patterns Specifically: Table 1.3: Classification of remittances according to criteria Side Criterias Classifcation Labour (illegal) Senders Temporary labor (legal) Migrants Supply Sending economy Types Source Intermediary Channel Demand Use Occupatiion: - No skill - Skill - Professional Gender: - Male - Female Developed Economy (South-South) Developing Economy (North-South) Foreign currency, Gold Monetary Account Kinds Cá nhân gửi Nhóm gửi (Collective Remittance) Licensed Credit Institutes Formal Licensed Money Transfer Organization Fettching foreign currency with report Non-licensed Organization Informal Three hands transfer Fettching foreign currency without report Paying debt Consumption Education, Medical (à labor quality) Goods: domestic, imported Short-term Saving Medium-term Long-term Investment Assets Security Side Criterias Household User Institute Classifcation Real Estate Others Development Project Development SMEs Social Funds/voluntary Urban Rural State Personal Source: syntesized by author 1.2 IMPACT OF REMITTANCE ON ECONOMIC DEVELOPMENT Remittance contributes to the process of capital accumulation, labor quality development, thereby promoting economic development 1.3 POLICY POLICY TO SERVICE ECONOMIC DEVELOPMENT 1.3.1 The concept of remittance policy serves economic development According to The University of Sydney (2018), the policy is basically understood as a deliberate principle system that guides decisions and achieves reasonable results In this study, remittance policy for economic development is defined as a system of regulations or tools used by state agencies to influence senders, recipients and intermediaries, through That contributes to promoting economic development towards reducing the dependence of the economy on remittances 1.3.2 The objective of remittance policy serves economic development In terms of the ultimate goal, remittance policy is aimed at economic development In essence, economic development lies in the fact that the economy not only has economic growth but also the economic structure has been changed in a positive way, ensuring longterm economic growth or otherwise Sustainable growth In terms of subjects, the objectives of remittance policy to serve economic development include three parties: (i) depositors; (ii) intermediary organization and (iii) money users In particular, users can be individuals and/or organizations (businesses, localities) In terms of priority, for different countries, based on the situation of receiving and using remittances, the objectives of remittance policy to serve economic development over time may not be the same Although the priority order at a time for remittance policies for economic development may be different in each country, the general trend of the remittance policy goal for economic development is compiled by time Time is as follows: (i) attract remittances; (ii) attract remittances into official channels; (iii) directing remittances into economic development 1.3.3 The content of remittance policy serves economic development Contents of remittance policies are presented according to the objects in the model including: overseas remittance providers, remittance intermediaries and recipients - using remittances For overseas remittance policies for the supply side, the content of remittance policies often focuses on attracting and securing future remittances supply through policies for workers who go abroad for a certain period of time and vaccination for settlers For remittance policies for money transfer intermediaries, the content of remittance policy aims to liberalize money transfer channels to reduce money transfer costs, creating benefits for service users For remittance policies for remittance recipients, the policy content focuses on recipients being individuals/households and organizations/localities, with priority given to using remittances to develop consumers, production and business for individuals/households and directing remittances into welfare investments for organizations/localities 1.3.4 Tool to implement remittance policies About tools to implement remittance policies, basic groups of tools include: legal, organizational and financial In addition to the above three basic tools, propaganda tools can also be used Depending on the characteristics and structure of migrants of each country, the propaganda tool may be designed differently 1.4 INTERNATIONAL EXPERIENCE ON HARASSMENT POLICY FOR ECONOMIC DEVELOPMENT AND LESSONS FOR VIETNAM 1.4.1 International experience on remittance policies for economic development a Experience on remittance policy on the supply side First, implementing policies to maintain close relations with migrants Second, policies to protect the rights and interests of migrants Third, remove barriers to overseas remittances Fourth, develop labor export market Fifth, mobilize remittances through financial instruments Sixth, improve financial knowledge for the community b Experience on remittance policy to intermediaries Firstly, licensing, classifying and creating a legal corridor for overseas remittance service providers to operate Secondly, building and improving the payment infrastructure connecting domestic domestic remittance service providers and starting to link with foreign countries to reduce transaction costs and enhance access to finance in the region countryside Third, create a mechanism to supervise organizations providing remittance services, make the market transparent c Experience of remittance policy on the demand side First, encourage overseas Vietnamese to borrow money to buy houses in the country Second, issue programs and investments to support local infrastructure development projects Thirdly, implementing a personal finance education program to orient the effective use of remittances 1.4.2 Summarizing international experience on remittance policies for Vietnam's economic development 1.4.2.1 Experience in designing and building remittance policies Design and construction of remittance policies should be based on the characteristics and trends of national migrants Each country has different economic, social and historical contexts, so the migration process and characteristics of migrants are not the same In order to build and implement effective remittance policies, the Government's remittance management regime should be concerned 1.4.2.2 Experience on policy for the supply side For overseas remittance supply, there are two important lessons: one is that it is necessary to maintain friendly policies with overseas Vietnamese in order to not only make use of the remittance source but also the gray matter from the overseas community; secondly, labor export policy should shift to the developed market to increase income and skills for workers, contributing to local labor transfer in the future 1.4.2.3 Experiences on policies for intermediaries Considering remittance as a resource for development investment, it is necessary to transparent information about remittances This transparency lies in the fact that state management agencies publish information about remittances accurately and promptly 9 1.4.2.4 Experience of policy on the demand side Experiences from the countries show the importance of using remittances in development investment activities To help households receive sustainable remittances, world experience indicates the role of financial education before, during and after temporary workers abroad In Vietnam, we can first take advantage of the extensive network of VBSP, people's credit funds and post offices in disseminating financial education After that, deploy financial education training from primary, secondary, high school and college and university levels CHAPTER THE CURRENT STATUS OF REMITTANCE POLICY FOR VIETNAM’ S ECONOMIC DEVELOPMENT 2.1 THE CURRENT STATUS OF REMITTANCE IN VIETNAM 2.1.1 The current status of remittance into Vietnam from the supply side perspective Firstly, on the subject of remittances, the subjects sending remittances to Vietnam are diverse but can be divided into two main groups: (i) export workers and (ii) settlers Based on the scale, especially for Vietnamese settlers, it can be divided into small groups, including: Vietnamese emigrating in the context of war crisis, Vietnamese brides who marry foreign husbands and others Secondly, in the form of remittances, before 1999, when the regulations on foreign exchange management in Vietnam were very tight, the cost of remittance was high so the form was mainly goods; after 1999, foreign exchange management regulations were relaxed, especially the encouragement of remittances, the development of institutions, the service of receiving and paying foreign currencies, leading to the form of remittances in currency in Vietnam increased Thirdly, the country sending remittances to Vietnam, remittances from the US and Canada account for the highest proportion, averaging about 64% in the 2011-2015 period Remittances from groups of developed countries such as Australia and European countries such as France and Germany are of great value, accounting for 5-9% of remittances into Vietnam and growing relatively sustainably 2.1.2 The current status of remittances into Vietnam from intermediaries perspective Table 2.2: Description of remittance channel to Vietnam Channel Types Notes Credit Institutes Formal Belongs to Credit Institutes Economic Organizations Private MTOs Post Office Fetching foreign currency with report to cusody Via banks (SWIFT) Via International MTOs Non-licensed Personal, Institutes Informal Via Agents Fetching foreign currency without report to cusody (Above 5.000 USD needed to report to custody) Source: systhesized from authors 10 2.1.3 The reality of overseas remittance into Vietnam is seen from the demand side Table 2.4: Purpose of using remittances of exporting workers by country Unit:% of total remittances sent Korea Japan Malaysia Taiwan Europe America Australia Expenditure 19 19 26 16 20 23 19 Middle East – Africa 21 Building house 16 23 18 13 21 15 17 Paying debt 21 37 18 31 30 10 10 23 Production, Business 11 12 Saving and Invest 27 23 16 22 20 13 28 21 Education and Health 11 Travel Others (pagoda funds, donnation) 2 1 7 2 1 Purpose Source: Nguyen Kim Anh etal (2017) 2.2 THE IMPACTS OF ACHIEVEMENTS OF ECONOMIC DEVELOPMENT IN VIETNAM 2.2.1 Impact of remittances on Vietnam's economic development through VECM model 2.2.1.1 Research models To assess the relationship between remittances, capital, human resources and economic growth, the topic uses Granger causality testing The VAR model is described in four equations as follows: ∆lGDP = α0 + Σn i=1 α1i ∆lGDPt-1 + Σn i=1α2i ∆lREMt-1 + Σn i=1α3i ∆lCAPt-1 + Σn i=1α4i ∆ENRt-1 + α5ECTt-1 + μt (1) n n n ∆lREM = β0 + Σ i=1 β1i ∆lREMt-1 + Σ i=1β2i∆ lGDPt-1 + Σ i=1β3i ∆lCAPt-1 + Σn i=1β4i ∆ENRt-1 + β5ECTt-1 + σt (2) n n n ∆lCAP = λ0 + Σ i=1 λ1i ∆lCAPt-1 + Σ i=1λ2i∆ lGDPt-1 + Σ i=1λ3i ∆lREMt-1 + Σn i=1λ4i ∆ENRt-1 + λ5ECTt-1 + εt (3) ∆ENR = ω0 + Σn i=1 ω1i ∆ENRt-1 + Σn i=1ω2i∆ lGDPt-1 + Σn i=1ω3i ∆lREMt-1 + Σn i=1ω4i ∆lCAPt-1 + ω5ECTt-1 + γt (3) In which: lGDP = logarit of Gross Domestic Productivity lREM = logarit of remittance lCAP = logarit of capital formation ENR = growth rate of number of secondary school student adjusted by population growth ECTt-1 = error correction term, lag period μt, σt , εt, γt = error term 2.2.1.2 Data Data sources of GDP, CAP and REM are extracted from International Financial Statistics (IFS) Meanwhile, the human resource index is calculated according to the statistics of the General Statistics Office of Vietnam All data were seasonally calibrated according to the Census method X13 and logarithmized (except human resource data, ERN) to limit the variance of variance errors After logarithmization, the symbol of each variable (except for the ERN variable) will be added with the letter "l" in advance 11 Table 2.5: Statistical analysis describing variables in VECM model Observations: 84 lGDP lREM lCAP ENR Mean 8.739 6.798 3.424 6.582 Max 9.106 7.895 3.694 7.95 Min 8.388 4.362 3.282 5.39 Std Dev 0.218 0.896 0.121 0.93 Skewness -0.105 -0.465 0.631 0.054 Prob 0.020 0.036 0.013 0.016 Source: results from Eviews 2.2.1.3 Research results Long-term impact assessment In model 1, the dependent variable is economic growth, showing the long-term impact of remittances, capital and human resources on economic growth in Vietnam in the 19962016 period In model 2, with the dependent variable, remittances shows a long-term impact from economic growth, capital and human resources to overseas remittance flow in Vietnam in the period 1996-2016 In model with the dependent variable is the source of capital, which shows a longterm impact from credit growth, remittances and human resources to form capital in Vietnam in the period 1996-2016 In model 4, the dependent variable is the human resource, which does not appear to have a long-term impact from economic growth, remittances and capital to human resource formation in Vietnam in the 1996-2016 period Short-term impact assessment With the dependent variable of economic growth, Wald test has shown that remittances, capital and human resources all have an impact on economic growth in the short term With the dependent variable of remittance flow, Wald test showed that economic growth and capital sources have no impact on remittances in the short term Meanwhile, human resource changes have impact on remittances in the short term With the dependent variable being the source of capital, Wald test shows that the variables of economic growth, remittances and human resources have no impact on capital resources in the short term With the dependent variable of human resources, Wald test showed that remittances, economic growth and capital sources have no impact on human resources in the short term 2.2.1.4 Interpreting of results First, remittances have a positive impact on economic growth in Vietnam both in the short and long term Second, the results from the model not show the short-term impact from remittances to investment capital, but only show the long-term impact of remittances, economic growth and human capital to investment capital 2.2.2 Impact of remittances on Vietnam's economic development through PSM model 2.2.2.1 Select the model Assessing the impact of remittances on households receiving remittances compared to themselves in the hypothetical conditions they did not receive by the method of connecting trend points with the control group The connection technique using the "nearest neighbor" method is applied Impact assessment equation: ATT = E(Yni| khi=1) – E(Ynj |khi=1) 12 2.2.2.2 Data Exploiting a set of data from the survey of living standards in 2016 Poverty thresholds for rural and urban areas are taken from Decision No 59/2015 / QD-TTg Table 2.12: Remittance value and number of households receiving remittances by region Mean of Remittance (1.000 VND) 2.348,7235 2.051,5237 2.141,0032 Areas Urban Rural Total Number of households 2.828 6.565 9.393 Number of receiving remittance household 137 216 353 Source: calculated o STATA from VHLSS 2016 Table 2.13: Summary of varibles in PSM Variables Dummy: receiving remittance (Yes/No) Remittance volume by community Region Areas (Urban/Rural) Dummy: temporary house or not % person graduate primary school Income per cap Multi-dimensional povery index Income Poverty line Education Expenditure Health Expenditure Contigent healt Expenditure Durable Expenditure Sign Obs Mean Std Min Max kh 9.393 0,037 0,1901 kh_xa 9.393 6.422,307 36.111,61 642.000 reg6 urban 9.393 9.393 3,315 1,698 1,8155 0,458 1 temhouse 9.393 7,878 26,941 100 tyle_tntieuhoc 9.389 0,231 0,2698 nom_inc 9.393 2.952,225 2.778,19 115 96.970 MPI30 9.393 0,039 0,116 0,8 pvline_inc chigd chiyte 9.393 9.393 9.073 760,215 4.702,291 5.187,999 91,749 14.680,97 11.613,03 700 900 735.000 306.965 chi_yte_duphong 9.393 386.146 1.255,358 44.670 chi_lauben 9.393 7.681,294 43.945 1.206.000 Source: calculated o STATA from VHLSS 2016 2.2.2.3 Results and Discussion Table 2.14: Results of impact assessment of PSM model Outcome varibles Income per cap Multi-dimensional povery index Income Poverty line Education Expenditure Health Expenditure Contigent healt Expenditure Treated 4.492,6 Control 3.216,134 ATT 1.276,525 t-Stats 5,01 0,009 0,013 -0,004 -0,74 7.044,378 525,742 4.979,402 5.353,083 381,5 4.947,602 1.691,294 144,242 31,8 1,39 1,38 0,03 13.503,142 5.656,485 7.846,657 2,28 Source: calculated o STATA from VHLSS 2016 Remittances have a positive impact on per capita income / month, reducing multidimensional poverty, expanding the ability to spend on commodities However, the rate of increase in spending on education is less than that of health and is particularly lower than spending on durable goods 2.2.3 Impact of remittances on Vietnam's economic development through survey 2.2.3.1 Methods of survey In order to assess the impact of remittance flows on economic development in Vietnam, this study conducted qualitative analysis through surveys in the area to find evidence of remittance flows to economic development 13 Table 2.16: Summary of sample survey No Types Senders Number of people Channel In-depth Interview via Viber/Zalo/Messenger migrants temporary labor Notes Money transfer channel In-depth interview Interview via phone (private MTOs) Remittance centre Agribank (1 person) Remittance Office, Agribank branch Thanh Hoa (1 person) Remittance Office, Agribank branch Phu Tho (1 person) TNHH Anh Quang (1 person) TNHH Kim Linh (1 person) Đông Á Remittance (1 person) Sacombank Remittance (1 person) Recievers (households) 12 In-depth interview Thanh Hoa (4 household), Phu Tho (4 houesholds), Ha Tinh (4 houesholds) Institutions that lending labor export In-depth interview Agribank (1 leader in charge of credit); VBSP (1 leader in charge of credit) Farmer Association In-depth interview Chief in Farrmer Association in Dong Khe, Dông Son, Thanh Hoa Chief in Farrmer Association in Vinh Lai, Lam Thao, Phu Tho Total Number of in-depth interview: 32 people Source: author 2.2.3.2 Research results Household level For households, the survey results show that remittances have a positive impact on household economy, help eradicate hunger, reduce poverty, accumulate assets in the future and improve the level of health awareness , Financial services However, remittances have no impact on household economy development on a large scale At official money transfer organizations For remittance intermediaries, in addition to the economic benefits gained from money transfer fees, these organizations, especially credit institutions, not only diversify their income sources but also expand their relationship contact with customers Another interesting result from the interview with Agribank's banking group is that remittances sent in foreign currencies may not allow people to enter bank accounts but instead re-lend relatives Their neighbors are in need of foreign currency to export labor For informal money transfer channels, remittances, on the other hand, always bring benefits to this activity thanks to quick and convenient procedures However, considering the overall economy, remittances through informal channels will make it not only difficult for statistical work but the security for recipients is not always guaranteed as money situation fake Another aspect is that the informal money transfer channel will enable many illegal workers to send money home, making it more difficult for bilateral negotiations to bring Vietnamese workers to the country outside work Locally Survey data of the study indicate remittances impact on the local economy in two positive and negative aspects On the positive side, remittances are a resource sent to local households, helping the locality to eliminate hunger, reduce poverty quickly, improve sanitation, rural areas change thanks to spacious houses On the negative side, remittances affect the local economy in a negative way if remittances are used for the purpose of hoarding real estate This makes land prices rise rapidly, so those who have real needs not buy houses Another negative point is the waste, 14 usually remittances will be rebuilt to a spacious house, but if built too much, the money put into it will lose the opportunity for those in need Other bridges are approached Finally, in the short term, the local economy is affected by many workers going abroad to business 2.3 THE CURRENT STATUS OF REMITTANCE POLICY IN VIETNAM 2.3.1 Remittance policy in Vietnam before 1999 Due to the specific context of the economy before 1999, Vietnam's remittance policy before 1999 was not comprehensive and systematic Rather, remittances have not been included in the focus of state management agencies as a resource for Vietnam's economic development 2.3.2 Remittance policy in Vietnam in the period 1999-2018 Vietnam's remittance policy from 1999 to 2018 has been institutionalized The most important point in remittance policies in this period is the policy to encourage overseas Vietnamese to send money home as shown in Decision No 170/1999/QD-TTg After obtaining Decision 170/1999/QD-TTg, the Government has issued an important policy to increase overseas remittance revenues for Vietnam through policies to promote labor export and protect the rights of the community Vietnamese overseas with Vietnam Table 2.17: Remittance policy framework in Vietnam in the period 1999 - 2018 Object Solution Tool Target Encourage people Overseas Vietnamese send money home Supply side: Attracting remittances Promote to send workers abroad Protecting rights for overseas Vietnamese Create a legal Intermediaries: framework to regulate Manage money operations of overseas transfer services remittance service providers Propaganda (call for deposit) Tax exemption for remittances Allow to deposit on savings account in foreign currency, withdraw money in foreign currency Preferential credit to foreign workers Support costs before going to foreign workers Fund to support foreign workers Organization (Overseas Vietnamese Committee for the organization of community cohesion) Legal (Overseas Vietnamese own houses in Vietnam) Finance (Citizens Protection Fund, Fund to attract overseas residents) Form legal documents on management of overseas remittance services, focusing on licensing and reporting of companies Propaganda from the local received many remittances Social and charity funds Source: synthetic author 2.3.2.1 Policy to increase supply of remittances a Labor export policy Policies to increase the supply of remittances through labor exports include two main policies: (i) support for labor export loans, preferential loans and (ii) management of export companies labor Demand Propaganda 15 b Policy to protect the interests of overseas Vietnamese In order to ensure a stable source of remittances, in addition to policies to support labor export, policies also aim to protect the interests of overseas Vietnamese, including Vietnamese people residing abroad 2.3.2.2 Policy to manage money transfer services Orientation of management of organizations allowed to perform the service of receiving and payment of foreign currency, including remittances, is basically unchanged from 1999 to 2018 However, the newly created document system is calculated update and help management agencies to control the quantity and quality of operations of organizations implementing this service Thereby, helping management agencies, namely the Department of Foreign Exchange Management and Forecasting Department of the State Bank of Vietnam to improve the quality of overseas remittance statistics, at the same time, also help protect customers' interests 2.3.2.3 Organizing the implementation of remittance policies in Vietnam in the period 1999-2018 The institution of remittance in Vietnam is relatively adequate, however, two shortcomings are: (i) due to the separation of management between ministries, the collection, sharing, use and exploitation of limited data on remittances; (ii) although it has allowed to open savings accounts in foreign currencies, a comprehensive institution to direct remittance flows into development investment channels has not been achieved 2.4 EVALUATION OF THE REMITTANCE POLICY FOR ECONOMIC DEVELOPMENT IN VIETNAM 2.4.1 The positive side The remittance policy framework is relatively complete and unified from 1999 to 2018 Policies on the development of remittance intermediary services have been upgraded since 2016, facilitating the opening of this service The policy for labor export has a turning point when creating a legal framework from the Law to sub-law documents Thanks to policies to encourage overseas Vietnamese to send money home, the size of remittance flows into Vietnam has made impressive growth According to World Bank (2017), if in 2000, the size of remittances was about 1.34 billion USD, by the end of 2017, this figure was nearly 14 billion USD, 10 times more The size of remittances is nearly equal to the budget for education, higher than the budget for new rural development in the period 2016-2020 Figure 2.4: Overseas remittance flow into Vietnam in the period 2001-2017 17 16 20 15 20 14 20 13 20 12 20 11 20 10 20 09 20 08 20 07 20 06 20 05 20 04 20 03 20 20 20 20 02 70% 60% 50% 40% 30% 20% 10% 0% -10% -20% -30% 01 16 14 12 10 Kiều hối (tỷ $) (trục trái) Tăng trưởng kiều hối (%) (trục phải) Kiều hối/GDP (%) (trục phải) Nguồn: Worldbank Data Indicator 16 2.4.2 Limitations and causes Firstly, the legal framework is lacking in remittance policies for the demand side and management of remittance flows is not good The subjective cause is mainly the management agency has not designed, built remittance policies to serve economic development overall, in relation to other policies and in the new context Consumer culture plus the difficulty in measuring remittance flow makes it difficult for management agencies to come up with appropriate policy systems Secondly, low-quality export labor, low awareness leads to long-term consequences The cause of this limitation is that the management agency has not issued a strategy for sending workers to work abroad for a certain period of time Thirdly, credit for labor export plummeted The cause of this situation can be attributed to workers; from businesses and management agencies On the side of employees, preferential credit for foreign workers is mainly deployed in poor districts - areas with low educational level On the enterprise side, difficult macro conditions or due to the partner breaking the contract leads to no source of work to exploit On the side of management agencies, there is no mechanism to provide information between the party sending workers abroad with credit institutions Fourthly, there is an illegal labor in foreign countries that creates remittances through informal channels or illegal income sources The cause of this restriction is that there is no legal regulation for this group of workers, creating many difficulties and complexities in managing and resolving issues related to rights and meaning service of workers Fifthly, the propaganda related to the policy of promoting Vietnamese workers to work abroad is not yet systematic and has not yet shown the "economic development" in the true sense The main reason lies in the lack of strategies to send workers abroad and how to organize propaganda Sixthly, some policies for settlers are not appropriate, especially when using propaganda tools Seventhly, the ability to manage money transfer intermediaries is weak, especially in Hanoi because the market is still young compared to Ho Chi Minh City In addition, the management of informal money transfer organizations is difficult due to both supply side and demand side 17 CHAPTER SOLUTION ON REMITTANCE POLICY FOR ECONOMIC DEVELOPMENT IN VIET NAM 3.1 ORIENTATION ON REMITTANCE POLICY IN VIET NAM First, remittances is important additional source of income in foreign currencies for the economy Thus, the remittances policy framework aim to develope the economic in Viet Nam needs to be studied and built Second, remittances although it is a monetary problem but based on the social relationships (Ciggett, 2005) Therefore, the remittances policy needs to be built based on characteristics of migrants and recipients of remittances Third, remittance flows not only affected by remittances policy but also affected by other policies Hence, while buiding the policy it is right to focus on the synchronization between policy issues are issued Forth, remittances not only exists in monetary form and goods, it also exists under gray matter form The development of remittance policy is closely related to the policy for talents and education policies, science – technology should be concerned in the future Fifth, remittances can come from others country, different type of careers depend on the geographical location and work of overseas Vietnamese Thus, remittances policy should be built to ensure the diversity of the above criteria to avoid negative effects of centralization Sixth, remittances is closely related to the money-transfer channel services Therfore, remittances policy needs to cared about reducing the cost of money-transfer through opening market further Seventh, due to an external source of foreign currency into country, remittance statistics plays an important role to promote the internal resources of this funds Hence, remittances policy should concerned about the remittances information and the information on the market of remittance receipt and payment services transparency Finally, thinking of remittance policies for economic development needs to be properly acknowledged about the implications of development The development here is longterm, is a change, a change in the quality of labor and livelihoods of households where remittances are received 3.2 GOAL OF REMITTANCE POLICY FOR ECONOMIC DEVELOPMENT IN VIETNAM Table 3.1: Remittance policies for economic development by subjects Subjects Supply Target Specific Target Policy Measures Attracting remittances in the short term Maximize the source of remittances sent from abroad Promoting the program to take quality short-term workers abroad Guaranteed source remittances in long-term Development cohesion community Exchange and education programs for children of transnational families Attract remittances through the state budget channel Voluntary charity Attracting remittances into development investment channels through the government Attracting overseas remittance sources into development investment channels Develop a group investment mechanism by region Approach through microfinance institutions Developing small and medium enterprises Mechanism to connect words remittances in groups to the local government Credits for recipients remittances Promotion mechanism (reducing import tax on capital goods) 18 Subjects Mediate Demand Target through the organization Specific Target Approach through investment mechanism through funds Developing the official money transfer market Reduce the cost of money transfer Developing savings channel from remittances Encourage reasonable consumption from remittances Encouraging savings and investment from overseas remittances Encourage sending money through financial intermediaries Increase profits from remittances Encourage consumption of domestic goods Policy Measures Mechanism to connect words remittance through funds Create a clear mechanism in the money transfer activities of organizations Cross-selling products between credit institutions Remittance bonds Propaganda Price support Create conditions for depositors to spend with their family members Health insurance for nonmigrants but selling to migrants Increase savings, private investment from remittances Propagating Personal Financial Education Source: synthesis of the author 3.3 REMITTANCE POLICY SOLUTION FOR VIET NAM ECONOMIC DEVELOPMENT 3.3.1 Solution group from supply side 3.3.1.1 Orientation and management of labor export market First, labor export market orientation towards supply - demand Second, strictly manage the labor export market toward supply - demand 3.3.1.2 Improving the quality of export labor of Vietnam In the short term, it is necessary to reform the program and strengthen training facilities for export workers In the medium term, it is necessary to step up international integration on vocational training to help Vietnamese laborers to be assessed through foreign criteria system In the long term, to develop export workers in particular and Vietnamese people in general, improve professional qualifications, skills, foreign languages, knowledge of basic economics - finance - banking 3.3.1.3 Attracting remittances and gray matter from Vietnamese settlers First, strengthen the promotion of the image of the country and people of Vietnam to go abroad through a variety of information channels Second, create a communication channel connecting Vietnamese people at home and abroad Third, strengthen the protection of the rights of Vietnamese settlers 3.3.2 Solution group for intermediaries 3.3.2.1 Manage and encourage the development of overseas remittance services First, continue to review, authorize and strengthen monitoring of economic organizations implementing services of receiving and spending remittances Second, licensing organizations providing microfinance services to provide services of receiving and spending remittances Third, encourage equitization of overseas remittance companies Fourth, encourage the development of payment intermediary services associated with remittances 19 3.3.2.2 Strengthen monitoring and transparency of information for overseas remittance services a About strengthening supervision of operations of remittance remittance companies The Foreign Exchange Management Department - the State Bank of Vietnam (SBV) needs to supplement the reporting information of licensed private economic organizations to provide remittance services In addition to the receipt and payment and foreign currency payment as we are doing, the organization should report to the SBV about the data on receiving remittances by national origin and the measures taken by the company to detect anti-money laundering of the organization, the average service charge of the organization… b About strengthening information transparency for overseas remittance services In order to protect consumers' rights, relevant solutions to transparency of information on the money transfer service market are very important Therefore, it is necessary to have a mandatory policy for organizations to have an official website with content that needs to be approved by the State Bank of Vietnam and the Ministry of Information and Communications At the same time, the SBV should announce the list of licensed organizations to carry out activities of receiving and paying foreign currencies on the official website of the State Bank 3.3.3 Group solutions on demand 3.3.3.1 Mobilize remittances into charitable funds In order to mobilize overseas people to send money home via charity, the transparency of the Fund's operational information plays an important role From legal information, operational purposes to actual activities that require evidence that can be verified and authenticated by state agencies The Funds can work closely with the External Communications Department of Vietnam Television in propagating the Fund's activities on official channels of Radio in foreign countries At the same time, the list of contributors to the Charitable Fund needs to be re-informed on the means to pay tribute to overseas Vietnamese In addition to transparency of purpose, the Fund's operation principles must be transparent, the Funds should regularly improve management and executive capacity to develop the Fund and bring capital to the right people effectively 3.3.3.2 Mobilize overseas remittances into developed consumer channels To promote the education of personal financial knowledge, the thesis proposes to implement a financial education model through a network of microfinance service providers such as VBSP, people's credit funds, MFIs and Agribank 3.3.3.3 Mobilize overseas remittances through the development of thrifty products In order to successfully issue remittance bonds of this type, in addition to the goals for the community, society and the development of the locality are in difficult circumstances, scale, term and issuance interest rate should be appropriate to meet the needs of buyers and the whole project is planning to raise capital Accordingly, the time of release and marketing of products that save special bonds need to be studied thoroughly In particular, we must first estimate the amount of potential remittances and the needs of the remittances themselves of savings products related to remittances in general and bonds of "remittances" in particular 3.3.3.4 Mobilizing overseas remittances into development investment channels From the experience of using remittances from countries receiving remittances, Vietnam should call for money from remittances into microfinance institutions, forming funds of overseas Vietnamese to invest in small and medium enterprises and conclude a combination of overseas remittance sources and investment capital sources for development projects 20 3.4 SOME RECOMMENDATIONS 3.4.1 Improve statistics on remittances In order to improve the remittance statistics work, on the one hand, it is necessary to create the development for the official money transfer service market in order to influence the money transfer motivation of the sender, on the other hand, the State Bank of Vietnam needs to petition the Government Adjust Decree 16/2014 / ND-CP on management of payment balance Accordingly, customs authorities need to control and determine the number of remittances transferred through border gates 3.4.2 Enhancing the transparency of information on remittances The remittance data that the State Bank of Vietnam has collected and followed since 1999 should be released to the public, maybe every year, to be quarterly and monthly in order to create transparency and make Vietnam accessible with a different source of funding in case the remittance figure given by the World Bank is too high 3.4.3 Reorganize the Citizens Protection Fund and the National Employment Fund The Government should study and review this Protection Fund in two directions, one is to merge with the Job Creation Fund, and the other is to change the Fund's payment mechanism in accordance with the practice to facilitate Quick support for Vietnamese citizens who are struggling abroad For the National Employment Fund, the Ministry of Finance should pay attention to allocating additional funding for the National Fund for Employment to meet the demand for borrowing capital at work (development investment capital) Besides, it is necessary to strengthen the apparatus and strengthen the management and use of this Fund effectively and legally; direct the strict implementation of the audit recommendations of the State Audit on the Fund's operations to overcome the limitations in inadequate closing and payment of funds 3.4.4 Strengthen management of preferential credit activities for labor export Tighten the management of preferential credit activities for labor export, especially deposit issues of employees at enterprises 3.4.5 Develop policies for short-term seasonal workers Early issue legal framework to create conditions for short-term employees to work in developed countries GENERAL CONCLUSIONS The topic: "Remittance policy for econimic development in Viet Nam" has solved main research objectives, including: First, systematizing the theoretical basis of remittance policy to develop the economy The thesis approaches remittances according to the three-phase supply-demand model, thereby analyzing the remittance concept according to supply and central channels space and reception Also with this approach, the thesis offers characteristics and classification of remittances to suggest remittance policies Regarding remittance policies, the thesis approaches remittance policies to serve economic development towards objects in the threephase supply-demand model Accordingly, policy objectives, content and tools are in turn systematically expressed Finally, international experience of remittance policy is presented to further clarify the scientific arguments on the researched issue Second, analyze the status of remittances and assess the impact of remittances on economic development in Vietnam The status of remittances divided by the supply-demand model combining the theoretical basis from the classification of remittances has presented a general picture of 21 remittances Using quantitative methods through VECM model, PSM and in-depth interview method, the thesis concluded that remittance has a positive impact on household economic development, especially the households in rural areas In addition, remittances have a positive impact on money transfer intermediaries However, at the local level and the economy, remittances can cause waste due to not being used in development investment channels Thus, the establishment of remittance policies for economic development in Vietnam is necessary Third, analyze the situation and assess remittance policies to serve economic development in Vietnam By synthesized methods and expert survey, remittance policy in Vietnam has been shown through the system of legal documents and institutions when deployed Research results show that remittances policies from 1999 to present are relatively appropriate, contributing to increasing remittance flow into the official channel, however, the gap in the remittance policy framework in Vietnam is in the policy of using remittance flows towards economic development The system of objectives, contents and instruments of remittance policies to serve economic development needs to be built to enhance the positive impact of remittances on national development Fourth, propose a framework and solution on remittance policies to serve economic development in Vietnam The dissertation has analyzed the orientations on remittance policies, set out the framework of the system of remittance policy objectives to develop the economy Then, based on the three-phase supply-demand model and survey results, the thesis offers groups of solutions to improve remittance supply; strengthen management and supervision of organizations implementing remittance receiving and payment services and solutions for remittance recipients Additional recommendations are presented to increase the effectiveness of the implementation of the solution system Limitations of the thesis are due to limited resources, so the number of in-depth interviews, especially those who send and receive money is not much The variety of depositors in the categories will be helpful for remittance policy making, so this gap will be the target of future research In addition to the limited scope of the survey, because the VHLSS 2018 data set cannot be exploited yet, the thesis cannot evaluate over time the influence of remittance flows on economic development according to different models special (DID) Moreover, the relationship between remittances and credit has not been explained due to modest input data These difficulties and limitations are an opportunity for further research 22 LIST OF PAPERS RELATED TO THE THESIS TT Tên công trình Tác giả Nơi đăng Kỷ yếu hội thảo khoa học Discusssion of Informal Remittances Measurement quốc gia: “Promoting Trần Huy Tùng Finacial Inclusion in Vietnam”, Học viện Ngân hàng, 2017 Kinh nghiệm sách kiều hối El Salvador học cho Trần Huy Tùng Việt Nam Đề xuất khung sách quản lý kiều hối Việt Nam Trần Huy Tùng Bàn thêm tác động kiều hối tới tăng trưởng kinh tế Việt Nam Trần Huy Tùng số hàm ý sách Hiệu tín dụng sách cho Đỗ Thị Kim Hảo đồng bào dân tộc thiểu số qua Chu Khánh Lân chương trình NHCSXH Trần Huy Tùng Tạp chí Thị trường Tài Tiền tệ, số 456, 2016 Tạp chí Thị trường Tài Tiền tệ, số 516 + 517, 2019 Tạp chí Ngân hàng, số 7, tháng 04/2019 Tạp chí Khoa học Đào tạo Ngân hàng, Số 200+201, tháng 02/2019 ISSSN 1859-011X ... BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING BANKING ACADEMY OF VIETNAM -000 - TRAN HUY TUNG REMITTANCE POLICY FOR ECONOMIC DEVELOPMENT IN VIETNAM Major: Finance – Banking Code... encouragement of remittances, the development of institutions, the service of receiving and paying foreign currencies, leading to the form of remittances in currency in Vietnam increased Thirdly,... every 10% increase in return of migrants leads to 1% increase in rural income, 52% increase in investment in education and 15% increase in housing investment d Remittances, poverty and inequality