Remittances for September 2019

Lower remittances in September, similar to previous years


  TOP$ millions
  Month Ended Year Ended  
  Sep 19 Aug 19 Jul 19 Jun 19 Sep 19 Sep 18 Shares
of totals*

Remittance Receipts 26.5 32.8 32.1 27.0 348.7 348.5 100.0
Private Transfers 24.7 30.4 29.9 24.0 316.4 313.8 90.7
Employee Compensation 1.5 2.1 2.1 2.3 23.4 23.0 6.7
Private Capital Transfer 0.3 0.1 0.1 0.6 7.2 10.3 2.1
Social Benefits 0.1 0.2 0.1 0.1 1.7 1.5 0.5

* 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

Remittance receipts declined to $26.5 million in September 2019, 19.3% lower than the previous month which is a trend that is observed each year. The monthly decline resulted from lower receipts from families abroad and a fall in receipts from the compensation of employees. Additionally, social benefit receipts slightly fell contributing further to the monthly decrease. These respective declines had offset the minimal increase in private capital transfer receipts. Nevertheless, the women’s annual roll call and the Tongan churches annual offerings during the month may have contributed to the level of remittance receipts. Over the year, total remittance marginally rose by $0.1 million (0.04%) to a total $348.7 million. Private capital transfers declined by $3.1 million and was partially offset by the rise in private transfers, compensation of employees and social benefits.

The share of total remittances in the total Overseas Exchange Transaction (OET) receipts slightly rose by 0.1 percentage points to 47.3% over the month driven by the overall fall in the total OET receipts. The United States Dollar (USD) continued to be the dominant currency in remittance receipts (accounting for 42.1% of the total remittances) in September 2019. The Australian Dollar (AUD) and New Zealand Dollar (NZD) receipts followed with 28.2% and 23.8% respectively. The receipts in these major currencies all declined during the month with USD decreasing the most by $2.2 million, whereas NZD and AUD followed with a decline of $2.1 million and $1.7 million respectively. This may have been supported by the depreciation of the NZD against the TOP over the month.

Foreign Exchange Dealers (FEDs) remained as the preferred channel for receiving of remittances accounting for 86.6% share of total remittances with the remaining 13.4% via banks. This is however lower than a 87.2% in August 2019 and 88.5% in September 2018. The general public preference for sending and receiving money via FEDs is due to accessibility and faster services.

Private Transfers

In September 2019, private transfers fell by 18.9% to $24.7 million, particularly lower receipts of family support from friends and relatives abroad. Private transfers accounted for 93.2% of the total remittance receipts and 44.1% of the total OET receipts, higher than 43.8% last month reflecting the decline in the overall OET receipts. The total receipts of private transfers for the year ended September 2019 increased by $2.6 million (0.8%) driven mainly by receipts for family support.

Employee Compensation1

The total compensation of employees’ receipts declined in September 2019 to $1.5 million from a $2.1 million last month and represented 5.5% of the total remittance receipts. Receipts from both seasonal workers2 abroad and other wages & salaries fell by $0.4 million (39.8%) and $0.3 million (24.5%) respectively over the month. The fall in receipts from seasonal workers was due mainly to receipts in NZD which declined by $0.4 million.

However, total employee compensation rose over the year by $0.5 million (2.0%) to $23.4 million. Other wages and salaries accounted for 56.7% ($12.3 million) of the employee compensation receipts over the year, and the remaining 43.3% ($11.1 million) was from RSE/SWP workers. New Zealand RSE workers contributed the most to the seasonal workers’ receipts of $9.1 million, while the seasonal workers from Australia only contributed $1.9 million.

Private capital transfer & Social Benefits

The private capital transfer receipts increased by $0.1 million due to higher receipts of private grants for investment projects (particularly for construction purposes by families). However, social benefits receipts fell by $0.1 million driven by a fall in receipts of pension funds. The private capital transfer and the social benefits receipts account for 1.0% and 0.2% respectively of the total remittances for September 2019. In year ended terms, the private capital transfers receipts declined by $3.1 million (29.8%) while the social benefits receipts increased by $0.2 million (10.8%).

Outlook

Remittance receipts are anticipated to remain high in the upcoming months as the holiday season approaches and the Christmas festivities. 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 2019


pdfIcon September
Released on 13 March 2020 | 269 KB
   

pdfIcon July
Released on 6 December 2019 | 245 KB
pdfIcon August
Released on 20 January 2020 | 160 KB

pdfIcon May
Released on 1 October 2019 | 156 KB
pdfIcon June
Released on 17 October 2019 | 241 KB

pdfIcon March
Released on 3 July 2019 | 185 KB
pdfIcon April
Released on 29 July 2019 | 247 KB

pdfIcon January
Released on 18 June 2019 | 185 KB
pdfIcon February
Released on 21 June 2019 | 205 KB

2018


pdfIcon November
Released on 5 April 2019 | 210 KB
pdfIcon December
Released on 1 May 2019 | 210 KB

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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