OFW June remittance grew by 7%

According to the Institute for Development and Econometric Analysis, Inc. (IDEA), the central bank reported that the overseas Filipino workers’ remittance for the month of June grew 7 percent. An expert said that a possible reason for the increase is the strength of the peso which prompted overseas workers to send more dollars to cope up with the loss in value due to peso’s appreciation. The global demand for Filipino workers also helped in shielding us from the global uncertainties.

Per same published report, the Overseas Filipino Worker’s (OFW) remittances for the month of June reached to US$ 1.7 billion compared to the same period last year. Meanwhile, the total remittances for the first six months increased by 6.3 percent to US$ 9.6 billion compared to the first half last year. The expansion in remittances was due to the increases in the sea and land-based workers which saw an increase of 15 percent and 4.2 percent respectively. The sustained demand for Filipino workers amidst uncertainties in the global economy help boost the remittances. Moreover, Philippine financial institutions expanded offerings of financial products and services to the OFW’s and tied up with foreign service providers to make it easier for the workers to send money back in the Philippines.

Furthermore, it was also reported that a memorandum of agreement is on the way for the Philippines and Taiwan, the agreement will enable Taiwanese employers to directly hire Filipino workers. For the first six months of 2011, the countries that are the top source of remittances are United States, Canada, Saudi Arabia, Japan, United Kingdom, Singapore, United Arab Emirates and Germany.

 Likewise, the Philippine financial institutions continued to park their money at the Bangko Sentral ng Pilipinas through the special deposit account (SDA) as they are amassed with cash. The placement in the SDA facility rose by 66.4 percent to Php1.4 trillion as of the end of the June. The banks enjoy a higher returns in their investment thru the SDA facility of the central bank.

Moreover, the collection of the Bureau of Internal Revenue is up by 16 percent to Php73.79 billion from just Php63.81 billion same month of last year. However, the Bureau fell short of its target of Php74.61 billion set for the month. For the first seven months, the collection rose to Php531.786 billion, a 13.8 percent increase from last year. The BIR is confident in meeting its Php940 billion target this year. The government paid a total of Php408.771 billion for maturing obligations in the first half, an increase of 0.65 percent compared to last year’s. The payment to domestic creditors rose by 9 percent while a 12 percent dip was realized in the payment to the foreign creditors. The government has allotted Php823.267 billion this year for debt payment.

Lastly, the Office of the President allocated Php100 million for Export Support Fund for the exporters. However, it entails a condition that the exporters should present ways how the money would be spent. The fund will not be allowed to use for the airfares and hotels but rather on increasing export capacity, according to IDEA.

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