Workers abroad send home less money in April — BSP
REMITTANCES slipped in April to the lowest level in over a year as a number of overseas Filipino workers (OFWs) in Saudi Arabia went home, the central bank said yesterday.
Money sent home by OFWs totaled $2.083 billion that month, 5.9% lower than the $2.213 billion tallied last year and down a fifth from the record-high $2.615-billion inflow seen in March.
April’s tally was the lowest since the $ 1.997- billion remittances received in January 2016, but kept monthly inflows above $2 billion level for the 15th straight time.
In a statement, the BSP attributed the drop in remittances to the repatriation of workers under Saudi Arabia’s 90- day amnesty program for undocumented foreigners.
Contributions from land-based OFWs slid by 7.6%, versus a 0.3% increase in remittances from those working at sea.
Riyadh announced a three- month amnesty starting March 29 for undocumented foreign workers to leave Saudi Arabia without paying penalty or exit fees. The Philippine Department of Foreign Affairs said some 15,000 OFWs are eligible for the program.
The central bank said the lower US dollar value of remittances may have been due to the weaker exchange rates of currencies in the countries where Filipinos are
working, such as the Singaporean dollar, Australian dollar, the British pound and the euro.
Despite April’s decline, the four-month tally was 4.2% higher at $9.036 billion from $8.67 billion in the comparable year-ago period, according to BSP data.
The biggest sources of remittances in the four months to April were the United States ($2.994 billion), Saudi Arabia ($855.909 million), United Arab Emirates ($ 748.128 million), Singapore ($ 555.564 million) and Japan ($482.658 million).
Sought for comment, an analyst said April’s decline may have been expected coming from the previous month’s remittance surge.
“We noticed that since last year, there has been a tendency for OFW remittances to peak at the end of each quarter followed by a drop in the month afterwards, so a drop in April is not surprising,” said Ildemarc C. Bautista, assistant vice-president and head of research at Metropolitan Bank & Trust Co.
“The extra drop this year, though, might just be a re-clustering and timing issue, especially given the OFW remittance flow in March 2017 that was at an historic high.”
At the same time, Mr. Bautista flagged as “worrisome” that March’s peak could have been caused by the one-time repatriation of savings ahead of workers’ return from Saudi Arabia.
Angelo B. Taningco, economist at Security Bank Corp., added that monthly remittances will likely be sustained at the $2-billion level, on track to reach $28.6 billion for the entire year.
The central bank expects remittances to rise by four percent to $28 billion this year, although BSP officials said they will announce fresh estimates soon.
Cash remittances posted an all-time high of $26.9 billion last year, up five percent from 2015’s $25.607 billion.
Remittances support household consumption, which in turn has been a key driver of overall Philippine economic growth.