BSP, DFA to create currency exchange facility for OFWs

MANILA, Philippines - The Bangko Sentral ng Pilipinas and the Department of Foreign Affairs signed yesterday a pact to enable the immediate creation of currency exchange facilities to better assist repatriated overseas Filipino workers from areas of conflict or crisis.

BSP Deputy Governor Diwa C. Guinigundo, at the signing of a memorandum of understanding, said the central bank opens currency exchange facilities to allow Filipinos repatriated from war-torn countries to exchange their foreign currency notes not easily convertible to peso.

This pact with the DFA, however, will allow the “timely” and “immediate” creation of these facilities once the government declares a travel alert 3 on certain countries. A travel alert 3 entails the voluntary repatriation of Filipinos in the areas where this is raised.

So far, the BSP has put up seven currency exchange facilities with the first one established in 1990 following the Kuwait-Iraq war.

The second was introduced in 2003 during the US-Iraq war, then in 2006 during the Israel-Hezbollah conflict. The fourth was established in 2011 during the conflict in Libya, while the fifth and the sixth were created in 2013 following the disputes in Syria and in Egypt.

The seventh currency exchange facility for the Libyan dinar, established earlier this year, was opened following the continuing conflict between Libya and Syria.

“It is difficult to imagine what would happen to our GDP (gross domestic product) without the their support,” Guinigundo said, noting there were 2.3 million overseas Filipino workers registered last year.

Remittances from Filipinos abroad play a big role in supporting domestic consumption.

Last year, cash remittances surged 7.4 percent to $22.968 billion, the highest annual level ever recorded by the central bank.

Philippine economic growth accelerated to 6.4 percent in the second quarter from 5.6 percent in the first quarter. The government hopes to grow the economy by 6.5 to 7.5 percent this year from 7.2 percent in 2013.