Remittances

October 2018


Released on 7 February 2019 | Download the complete release | pdfIcon 210 KB


  TOP$ millions
  Month Ended Year Ended  
  Oct 18 Sep 18 Aug 18 Jul 18 Oct 18 Oct 17 Shares
of totals*

Remittance Receipts 28.2 27.7 31.6 30.1 348.3 323.1 100.0
Private Transfers 25.6 24.9 28.5 27.2 314.2 300.7 90.2
Employee Compensation 1.7 1.9 2.1 2.1 22.5 16.1 6.5
Private Capital Transfer 0.9 0.8 0.9 0.7 10.1 5.4 2.9
Social Benefits 0.1 0.1 0.0 0.1 1.5 0.9 0.4

*Based on year ended remittance receipts numbers
Note: Numbers may not add up precisely to the totals due to rounding errors
Source: National Reserve Bank of Tonga | Banks | Foreign Exchange Dealers

Slight increase in private transfers drive remittances up in October

Over the month, total remittances rose slightly by $0.5 million to $28.2 million. This resulted from slightly higher receipts from families abroad and private capital transfers. These increases had offset declines in compensation of employees receipts. Meanwhile, social benefit receipts remained stable over the month.

The increase in private transfers over October contributed somewhat to the overall rise in Overseas Exchange Transaction (OET) receipts. Despite this, the OET receipts rose a lot higher in October stemming from other means such as official transfers and services receipts. Therefore, the share of total remittances (in the total OET receipts) fell to 40.7% in October from 41.6% last month. The USD appreciated against the Tongan Pa’anga (TOP) in October which may have contributed to it being the most favourable currency for remittance receipts, with a total of $10.0 million. The AUD and the NZD both depreciated against the TOP which may have explained the declines in their respective currency receipts over the month. The AUD and NZD followed the USD and recorded respective levels of $9.5 million and $6.5 million.

Annually, total remittances rose as a result of increases in all categories. This led to a balance of $348.3 million which was supported by family support, events, and various occasions which took place throughout the year. The continuous increase in receipts for family support and from seasonal workers abroad continued to be key drivers in the annual rise.

In October, the Foreign Exchange Dealers (FEDs) remained as the most popular channel for remittance receipts accounting for 86.3% share of total remittances. Despite being lower than the share of 88.5% last month and the share of October 2017 which was 87.1%, it still reflects the convenience of sending money via FEDs compared to banks as they have more access points.

Private Transfers

Over the month, total private transfer receipts rose slightly by $0.6 million (2.6%) to $25.6 million. This was driven mainly by a rise in receipts of private transfers as gifts and for family support. The USD was the most favourable currency used for private transfers recording a total of $9.1 million in October 2018. The AUD and NZD followed the same trend with a total of $8.8 million and $6.2 million respectively. Receipts of private transfers continued to be the main purpose of remittances which accounted for 90.7% (a little higher than 89.9% last month) of total remittance receipts. Furthermore, private transfers recorded a share of 36.9% (lower than 37.4% last month) of total OET receipts in October 2018 reflecting the greater increase in the overall OET receipts. The total receipts of private transfers over the year to October increased yet again by $13.5 million (4.5%) driven mainly by receipts for family support.

Employee Compensation1

The total compensation of employees receipts declined in October to $1.7 million from last month. This resulted from declines of both AUD and NZD receipts over the month. However, over the year, total receipts for compensation of employees continued to increase and recorded a rise of $6.5 million (40.3%). This indicates that workers abroad such as RSE workers continue to remit wages and salaries to their respective local families.

Private capital transfer & Social Benefits

The private capital transfer receipts rose slightly by $0.1 million. This was higher receipts of private grants for home and household projects (particularly for construction and renovation purposes by families). However, social benefits receipts remained stable over the month noting no significant movements. The private capital transfer and the social benefits receipts account for 3.2% and 0.2% respectively of the total remittances for the month of October 2018. Annually, the private capital transfers rose by $4.7 million resulting in higher receipts of project and working capital funds, and for construction purposes. The receipts for social benefits rose also over the year by $0.5 million.

Outlook

Remittance receipts are forecasted to remain at high levels in the upcoming months, however, to increase at a slower pace. This is expected to be supported by events which include school anniversaries, family reunions, end of year prizegiving awards as well as the upcoming festive season. The Reserve Bank will continue to closely monitor the remittance receipts given it is the largest source of foreign exchange inflow for the Tongan economy.


1 - Employee compensation is the sum of wages and salaries from the seasonal workers abroad, Tongan residents working short term overseas, and resident employees serving foreign organizations.


Remittances Releases

Remittances Releases for 2018


pdfIcon September
Released on 7 February 2019 | 210 KB
pdfIcon September
Released on 7 February 2019 | 210 KB

pdfIcon July
Released on 23 November 2018 | 204 KB
pdfIcon August
Released on 23 November 2018 | 388 KB

pdfIcon May
Released on 20 August 2018 | 212 KB
pdfIcon June
Released on 10 October 2018 | 189 KB 

pdfIcon March
Released on 16 May 2018 | 220 KB
pdfIcon April
Released on 20 August 2018 | 192 KB

pdfIcon January
Released on 16 May 2018 | 220 KB
pdfIcon February
Released on 31 May 2018 | 200 KB

2017


pdfIcon December
Released on 22 March 2018 | 430 KB
pdfIcon November
Released on 2 February 2018 | 208 KB

pdfIcon October
Released on 25 January 2018 | 204 KB
pdfIcon September
Released on 27 December 2017 | 457 KB

pdfIcon August
Released on 27 November 2017 | 464 KB
pdfIcon July
Released on 16 September 2017 | 214 KB

pdfIcon June
Released on 16 September 2017 | 205 KB
pdfIcon May
Released on 15 August 2017 | 469 KB

pdfIcon April
Released on 10 July 2017 | 447 KB
pdfIcon March
Released on 29 June 2017 | 450 KB

pdfIcon February
Released on 2 June 2017 | 488 KB
pdfIcon January
Released on 2 June 2016 | 490 KB

2016


pdfIcon December
Released on 9 May 2017 | 451 KB
pdfIcon November
Released on 9 May 2017 | 534 KB

pdfIcon October
Released on 11 January 2017 | 438 KB
pdfIcon September
Released on 11 January 2017 | 438 KB

pdfIcon August
Released on 25 November 2016 | 444 KB
pdfIcon July
Released on 9 November 2016 | 441 KB

pdfIcon June
Released on 5 September 2016 | 227 KB
pdfIcon May
Released on 28 July 2016 | 227 KB

pdfIcon April
Released on 15 July 2016 | 205 KB
pdfIcon March
Released on 3 June 2016 | 208 KB

pdfIcon February
Released on 2 June 2016 | 208 KB
pdfIcon January
Released on 4 May 2016 | 208 KB

2015


pdfIcon December
Released on 4 May 2016 | 213 KB
pdfIcon November
Released on 4 May 2016 | 211 KB

pdfIcon October
Released on 1 February 2016 | 471 KB
pdfIcon September
Released on 4 January 2016 | 413 KB

pdfIcon August
Released on 4 January 2016 | 429 KB
pdfIcon July
Released on 22 December 2015 | 440 KB

pdfIcon June
Released on 9 October 2015 | 255 KB
pdfIcon May
Released on 23 September 2015 | 296 KB

pdfIcon April
Released on 22 July 2015 | 224 KB
   

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