Remittances withstand Omicron onslaught with January growth

MANILA, Philippines — Money sent home by Filipinos overseas continued its ascent at the start of the year, unfazed by the surge of infections due to the Omicron variant.

What’s new

Cash remittances coursed through banks grew 2.5% year-on-year in January to $2.67 billion, the Bangko Sentral ng Pilipinas reported Wednesday. However, this was slower than the 2.9% growth recorded in December last year.

Why this matters

Remittances are considered pillars of economic strength for the Philippines' consumption-driven economy, as money sent home by migrant Filipinos helps increase the spending capacity of their families here.

Likewise, remittances are also crucial sources of dollars for the country. In 2021, remittances amounted to $31.42 billion, expanding 5.1% compared to the 2020 haul. The collections slightly missed the BSP's forecast of 6% growth, but BSP Governor Benjamin Diokno said he hopes remittances would rise this year.

What an analyst says

Sought for comment, Jeremiah Opiniano, professor at the University of Santo Tomas and executive director at the Institute for Migration and Development Issues, hopes remittances could sustain its momentum. Remittances have shown curious resilience in the past two years in this pandemic, moving up even as virus containment measures in other parts of the world tightened.

"We hope this momentum be sustained. Because at the moment, identified countries have Omicron surges, and China currently endures its ‘worst’ COVID-19 outbreak. We hope that as the world begins to move to the next phase of the pandemic, there will be no new economic disruptions and no new variants," he said.

"I think countries have begun to slowly move forward (some even adopting "mask-less" policies). If so, we hope nothing debilitating happens because of the running COVID-19 pandemic," Opiniano added.

Other figures

• The BSP said 41.2% of cash remittances in January came from the United States, while the rest came from Singapore, Saudi Arabia, Japan, and the United Kingdom.
• Remittance from land-based workers inched up by 2.9% year-on-year to $2.103 billion in January. Sea-based workers brought in a total of $565 million, which expanded by 1.2% year-on-year.