Remittances shrink 5.4% in July

MANILA, Philippines - Overseas Filipinos sent less money to their loved ones in July amid the double-digit decline in the deployment of skilled Filipino workers abroad due to soft oil prices as well as the de-risking activities by foreign banks, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.

BSP Governor Amando Tetangco Jr. said cash remittances contracted 5.4 percent to $2.13 billion in July from $2.25 billion in the same period last year.

This is the second time this year that the monthly cash remittances declined after contracting 1.4 percent last March.

The decline in July pulled down the growth of cash remittances to three percent in the first seven months of the year. The BSP expects OFW remittances to grow four percent this year.

Tetangco cash remittances amounted to $15.32 billion from January to July, $449 million higher than the $14.87 billion in the same period last year.

“Remittance inflows for the first seven months of 2016 remained stable despite the decline in deployment of skilled Filipino workers,” Tetangco said.

Latest data from the Philippine Overseas Employment Administration (POEA) showed the number of land-based workers for new hires dropped 10.3 percent to 235,895 while that of sea-based workers plunged 44.4 percent to 134,360.

Remittances from land-based workers amounted to $12.1 billion in the first seven months of the year while that of sea-based workers reached $3.3 billion.

About 80 percent of the remittances came from the US, Saudi Arabia, the United Arab Emirates, Singapore, the United Kingdom, Japan, Qatar, Kuwait, Hong Kong, and Germany.

Likewise, personal remittances declined 5.4 percent to $2.35 billion in August from $2.49 billion in the same month last year.

For the first seven months of the year, personal remittances still managed to expand 2.9 percent to $16.92 billion from $16.45 billion.

Personal remittance is computed as the sum of gross earnings of overseas Filipino workers with work contracts of less than one year, including all sea-based workers, less taxes, social contributions, and transportation and travel expenditures in their host countries.

Data showed personal remittance flows consisted primarily of transfers from land-based workers with contracts of one year or more reached $13.1 billion as well as compensation of sea-based workers and land-based workers with short-term contracts reaching $3.6 billion.