OFW inflows up 15% to $10.5B in 9 mos
Philippine Star - November 16, 2007
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Money sent home to the Philippines by millions of Filipinos working abroad surged 15 percent to $10.5 billion in the first nine months of the year from a year ago, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.
September remittances grew 12.4 percent from a year earlier to $1.1 billion, the 17th straight month that the transfers topped the billion-dollar mark, the BSP said.
“Remittances have remained strong as local banks continued to provide expanded banking services to remitters and their beneficiaries, encouraging the use of formal channels of remittance transfer,” BSP said.
It said local banks have been increasing the number of remittance centers abroad and establishing tie-ups with foreign financial institutions to “better respond to the needs of overseas workers.”
Money sent home from more than eight million overseas-based Filipinos, around 10 percent of the population, has helped drive economic growth to 20-year highs and is one of the most important components of the domestic economy.
The BSP said inflows have been buoyed by local banks setting up more money transfer centers abroad and tying up with foreign banks to capture the remittance inflow. Philippine banks had 3,939 remittance centers in 2006 compared to 1,183 in 2005.
Banks’ focus on remittance business in recent years has helped cut the proportion of money sent home in suitcases and backpockets to an estimated five percent of the total from around 20 percent two years ago. The increased cash captured in official data has helped inflate growth in remittances.
The central bank expects remittances from formal and informal channels to hit a new peak of $14.7 billion this year, up 15 percent from last year’s record.
The number of workers going overseas rose nearly nine percent in September from a year ago, slowing the year-to-date decline to 1.7 percent.
The number of Filipinos getting work abroad, including as sailors, nurses, maids, IT professionals and entertainers, has been rising since July after falling in the first half of the year.
“Banks have been really aggressive in expanding their services and this has encouraged the use of formal channels of remittance transfer,” Tetangco said.
In the coming months, Tetangco said remittances are likely rise as authorities noted an increase in the deployment of workers.
In September, Tetangco noted that remittances went up by 8.7 percent year-on-year, based on data from the Philippine Overseas Employment Administration (POEA).
Tetangco said the deployment of workers has been picking up since July, moderating the contraction in deployment seen in the early part of the year.
From January to September, Tetangco said the total deployment of Filipino workers has declined by 1.7 percent year-on-year as a result of increasing competition from other labor-exporting countries as well as the tightening of immigration rules in major labor markets.
As immigration regulations and labor importation tightened in the country’s traditional labor markets, low-income jobs have been getting scarce and available positions were being rapidly filled up by workers from other countries willing to take lower pays. — With AFP
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