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Business / Economy

Overseas Chinese to send home $66 billion this year

By Riazat Butt (China Daily) Updated: 2015-06-22 09:37

Some sources, including the Organization for Economic Cooperation and Development, suggest that overseas Chinese have been the biggest contributors of foreign direct investment into China.

The vast majority of the $66 billion comes from the Asia-Pacific region, which is home to the greatest number of Chinese immigrants. Chinese communities in Europe also send money back home, although the amounts appear tiny when compared to those sent from East and Southeast Asia.

In 2012, for example, Chinese in Hong Kong sent $17 billion to the mainland, representing more than one-fourth of all remittances to the country that year.

The strongest remittance flow in Europe is between Italy and China, at $1.4 billion. Chinese immigrants in Spain sent back $991 million; in Germany it was $899 million; from the UK they sent $712 million, and from France, $614 million. All figures are from 2012, from a World Bank statistical model estimating the amount of money coming from each source country to each receiving country.

There is some room for error because the numbers are estimates. Furthermore, tracking remittances worldwide is difficult because many countries do not track funds that are sent or received.

Information published in February by Eurostat, which provides statistical information to European Union institutions, says the EU shows a persistent deficit in personal remittances with the rest of the world, with outflows exceeding inflows. "In other words, the EU's 28 member states remains a continuous net contributor to recipient economies abroad."

Victor Lum, vice-president of the Beijing immigration consultancy Well Trend, says: "In traditional Chinese culture, the family is the basic unit of society. So much so that the concept of family is extended to include close friends who are often referred to as 'brothers' and 'sisters'. There is an expectation that family members who have gone abroad, especially to wealthy and developed countries, should provide support to their family back in China.

"Transferring funds to China is easier than (transferring funds) from China. Also, for many European programs, the residency requirement is minimal, so principal applicants often return to China to resume their careers while leaving their dependents and spouses behind. In such cases, the dependents would continue with their education while the remaining spouse would look after them," he says.

Amy Liu, an assistant professor at the Department of Government at the University of Texas in Austin, specializes in the study of Chinese communities in Eastern Europe. She says that earning money is no longer the sole reason for the Chinese to leave their birthplace. "They want social status. It used to be about sending money and (then) going back. The Chinese also use their earnings to pay back their credit cards or a loan shark. They also spend their money on bringing someone else over."

Hsiao-Hung Pai, who has written extensively about Chinese workers in the UK, says some Chinese borrowed money to send their kids to the UK and their kids would send money back.

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