Remittances inch up in May, bucks global slowdown

MANILA, Philippines — Money sent home by overseas Filipinos to their families managed to grow in May amid a slowing global economy. 

Data released by the Bangko Sentral ng Pilipinas on Monday showed remittances coursed through banks inched up 2.8% year-on-year to $2.49 billion in May. 

Cash remittances expanded by 3.1% to $12.98 billion in the first five months. 

Money remitted by overseas Filipinos considered a cornerstone of the consumer-dependent domestic economy, posted its largest cash haul of $32.54 billion in 2022. This was despite being a year removed from the pandemic which crashed the global economy and forced overseas Filipinos to go home in droves because of layoffs and businesses going under.

The year opened with much of the same headwinds, such as a projected global recession, brutal inflation and expensive borrowing costs that continued to cast a shroud over the global economy.

Developed economies, including Germany and other countries in Europe, slid into an economic recession early this year as inflation swallowed up growth. Data from Statista showed 9.3% of the total overseas Filipino workers deployed around the world in 2021 worked in Europe.

For 2023, the BSP forecast that cash remittances would expand by 3% on an annual basis.

Nicholas Antonio Mapa, senior economist at ING Bank in Manila, expects cash remittances to grow at a 3% clip for the rest of the year. 

“The sustained and consistent flow of FX should remain a stable support for the PHP in the months to come,” he said in a Viber message.

Mapa explained that global slowdowns have not dented remittances, except for mobility lockdowns in the past that held back some growth. 

Data broken down showed 41% of remittances came from the United States while the rest flowed from Singapore, Saudi Arabia, Japan, United Kingdom, United Arab Emirates, Canada, South Korea, Qatar, and Taiwan. 

Remittances from land-based workers grew 2.9% year-on-year to $1.99 billion in May while sea-based workers sent in a haul that expanded 2.4% on-year to $510 million. — Ramon Royandoyan