OFW remittances slow to $4.8B in first 8 months

Remittances from overseas Filipino Workers (OFWs) grew by a slower 22.6 percent to $4.832 billion in the first eight months of the year compared with the expansion recorded during the seven-month period, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.

The BSP said the slowdown could be attributed to the fewer number of OFWs fielded abroad from 4.1 percent in January to July to only 3.9 percent in January to August.

Based on BSP report, remittances from OFWs accounted for the bulk of the 54.5-percent improvement in the country’s net inflow worth $2.906 billion during the eight-month period.

In August alone, remittances amounted to $586 million.

Although Filipino workers have traditionally flocked to the booming economies in the Middle East, more and more workers are finding employment in other parts of the world, particularly Africa and Europe.

By skills category, the BSP said the increase in deployed workers was noted mainly for transport equipment operators as well as professional, technical and related workers.

Labor has been the country’s most important and single most profitable export since the 1970s, accounting for a whole percentage point of the gross national product.

This year, the country sent an additional 558,376 workers abroad from January to July.

OFW remittances have fueled domestic consumer spending.

The BSP said government is stepping up marketing missions to send even more Filipinos abroad, exploring prospects for expanded hiring in the United Kingdom, the main destination of Filipino medical and health care personnel.

Various investment banks said that in the face of a bleak economy, overseas workers would be the country’s source of spending power.

In a paper analyzing the Philippine economy, Deutsche Bank earlier said that remittances from OFWs represented 10 percent of total gross domestic product.

"This is the extent to which the Philippines now piggy-backs on more successful economies and the extent to which it has diversified from its own historically unpredictable local economy," Deutsche Bank said.

"Ironically, it is the very bleakness of economic conditions over the past three years that has accelerated the exodus of Philippine labor abroad and improved the outlook for future remittances," Deutsche Bank said.