Remittances hit $23.2-B in 3rd quarter

By Rose de la Cruz

REMITTANCES of overseas Filipinos hit $23.2 billion from January to September 2017 up by 4.8 percent year on year, the bulk of which came from land-based Filipino workers with contracts of one year and those of house to house transfers. 

Bangko Sentral ng Pilipinas (BSP) Gov. Nestor Espenilla Jr. said remittances of land-based OFs with work contracts of one year or more including other house to house transfers rose by 5.1 percent to $18.4 billion, while those from sea-based and land-based OFs with work contracts of less than one year likewise increased by 3.5 percent to $4.8 billion for the same period. 

However, personal remittances in September (at $2.3 billion) were 7 percent less than the level of the comparative period last year. 

 

3.8 percent growth

For the first nine months of 2017, cash remittances from OFs coursed through banks recorded 3.8 percent growth from the level posted in the same period a year ago, reaching $20.8 billion. Cash remittances from land-based and sea-based workers grew by 3.8 percent and 3.5 percent to reach $16.4 billion and $4.4 billion, respectively. 

For September alone, total cash remittances fell by 8.3 percent year-on-year to $2.2 billion. 

This was attributed to the 11.7 percent drop in cash remittances from land-based workers which offset the 6 percent increase in transfers from sea-based workers. 

There are reports that a number of global correspondent banks have closed their service facilities on money service business (MSB), reflective of the increasing global trend where personal remittances represent the sum of net compensation of employees (i.e., gross earnings of overseas Filipino (OF) workers with work contracts of less than one year.

The trend also  includes all sea-based workers, less taxes, social contributions, and transportation and travel expenditures in their host countries), personal transfers (i.e., all current transfers in cash or in kind by OF workers with work contracts of one year or more.

Likewise, other household-to-household transfers between Filipinos who have migrated abroad and their families in the Philippines), and capital transfers between households (i.e., the provision of resources for capital purposes, such as for construction of residential houses, between resident and non-resident households without anything of economic value being supplied in return). 

The BSP started to release data on personal remittances in June 2012 that reduce correspondent banking relationships and focus more on home market. This may have partly affected remittances flows during the month.

 

Biggest declines

The countries that registered the biggest declines in cash remittances in September were Saudi Arabia, Kuwait, Qatar, and Australia. 

For Saudi Arabia, the decline in remittances could partly be the result of the continued repatriation of OF workers under the Saudi Arabian Amnesty Program which started last March 2017. 

Last September, the Saudi government extended the amnesty program anew and a total of 8,467 undocumented Filipinos already availed of the initial offer, according to the Department of Foreign Affairs.

Cash remittances coming from the United States (US), Saudi Arabia, United Arab Emirates (UAE), Singapore, Japan, United Kingdom, Qatar, Kuwait, Germany and Hong Kong comprised about 72 percent of total cash remittances in the first nine months of 2017.

 

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Thursday, 18 January 2018
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