Strong dollar remittances again keep PH economy afloat

Strong dollar remittances again keep PH economy afloat

By Tracy Cabrera

RUBBING it deeper in the skin of embassy officials assigned abroad on the economy-saving contributions of overseas Filipino workers (OFWs), an estimated 10 million citizens based in other countries have once more stepped in to buoy the local economy amidst the coronavirus global pandemic and natural disasters—driving a late third quarter surge in dollar remittances that has helped ward off a worst case scenario earlier feared by the Bangko Sentral ng Pilipinas (BSP).

The record high in remittances has prompted families of OFWs to urge government to provide ample protection to their relatives who are working in foreign countries in order to provide for their loved ones and give a better future for their children.

They highlighted recent reports of one government official who was caught on video abusing her Pinay household helper in violation of the rights given to OFWs and protected by laws and the Constitution. The official, ambassador to Brazil Marichu Mauro, has been recalled and formal charges have been filed against her.

In a statement, the BSP disclosed that personal remittances from OFWs amounted to more than US$2.888 billion in September 2020, which is higher by 9.1 percent than the US$2.648 billion recorded in the same month last year.

This brought the total personal remittances for the first nine months of 2020 to US$24.302 billion. At this level, the contraction in cumulative remittances for the first nine months narrowed to 1.4 percent from 2.6 percent in August 2020.

“This is better than the original forecast of a 5-percent full year decline,” BSP governor Benjamin Diokno pointed out.

Personal remittances from land-based workers with work contracts of one year or more rose by 10.2 percent to US$2.205 billion in September 2020, higher than US$2.001 billion recorded in the same month in 2019.

Similarly, remittances from sea-based workers and land-based workers with work contracts of less than one year rose by 6.5 percent to US$622 million in September 2020 from US$584 million a year ago.

Likewise, overseas Filipino cash remittances that are coursed through banks rose by 9.3 percent to US$2.601 billion in September 2020 from US$2.379 billion in September 2019.

This increase was due to the growth in remittances from both land-based (US$2.031 billion) and sea-based (US$570 million) workers, which rose by 10.2 percent for land-based workers and 6.5 percent for sea-based workers.

From January to September 2020, cash remittance amounted to PhP21.886 billion, a slight decrease of 1.4 percent from US$22.187 billion in the same period in 2019.

By country source, cash remittance for the first nine months of 2020 from the United States, Singapore, Qatar, Hong Kong and Taiwan registered growth, while a decline was noted in Saudi Arabia, the United Arab Emirates, Germany, Kuwait and the United Kingdom.

The United States posted the highest share of total remittances at 40.1 percent, followed by Singapore, the Kingdom of Saudi Arabia (KSA), Japan, the United Kingdom (UK), the United Arab Emirates (UAE), Canada, Hong Kong, Qatar and Taiwan. The combined remittances from these countries accounted for 78.8 percent of total cash remittances.

Regarding its data, the central bank cautioned that remittance centers in various cities abroad is to course remittances through correspondent banks, most of which are located in the US.

Similarly, remittances coursed through money couriers cannot be disaggregated by actual country source and are lodged under the country where the main offices are located, which, in many cases, is in North America. (AI/MTVN)

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