MANILA, Philippines – The country expects to earn more than $51 billion this year from the sustained inflow of remittances from overseas Filipino workers and the business process outsourcing sector, Dutch financial giant ING Bank said yesterday.
Joey Cuyegkeng, senior economist at ING Bank Manila, said money sent home by Filipinos abroad would grow at least three percent from $25.8 billion in 2015 to $26.6 billion this year.
On the other hand, revenues from the BPO sector would expand by up to 16 percent to around $24 billion this year.
Latest data from the Bangko Sentral ng Pilipinas (BSP) showed cash remittances from OFWs went up 4.4 percent to $6.56 billion in the first three months from $6.28 billion in the same period last year.
Remittances from land-based Filipino workers went up 5.3 percent to $5.1 billion, while remittances from sea-based workers increased 1.5 percent to $1.4 billion in the first quarter.
More than 75 percent of the cash remittances came from the US, Saudi Arabia, the United Arab Emirates, Singapore, Hong Kong, the United Kingdom, Japan, Qatar, and Kuwait.
Data from the Philippine Overseas Employment Administration (POEA) showed total processed contracts reached 585,688 in the first three months. Of the total number, about 452,722 were for land-based workers.
Cuyegkeng said remittance would grow between three and four percent in the next four years.
Remittances from more than 10 million Filipinos working abroad account for 10 percent of the country’s gross domestic product (GDP). This helps boost private consumption resulting to faster economic growth.
Earlier, Moody’s Investors Service downplayed the impact of weaker remittances from the Middle East due to the continued softening of oil prices on the country’s remittances.
Moody’s cited the robust BPO industry that is a strong contender with remittances as a revenue generator.
He added the revenue growth of the BPO sector is expected to average 15 percent in the next four years.
According to him, the moderate weakness of peso would enhance the incomes of OFW households and modestly improve the competitiveness of the outsourcing industry.
Cuyegkeng pointed out the law recently signed by outgoing President Aquino creating the Department of Information and Communication Technology (DICT) would enhance the outsourcing industry’s prospects.
He added the pressure on the telecom sector to improve internet speed and infrastructure is important.
Rivals Philippine Long Distance Telephone (PLDT) and Ayala-led Globe Telecome joined hands to acquire the telecommunication assets of diversified conglomerate San Miguel Corp. for P70 billion.