Remittances post decline in September

Money sent home by overseas Filipinos (OFs) declined in September this year, data from the Bangko Sentral ng Pilipinas (BSP) showed yesterday.

In a statement, BSP Governor Nestor A. Espenilla Jr. reported that cash remittances coursed through banks were down by 8.3 percent to $2.19 billion last September from $2.38 billion in the same month a year before.

“This [reduction] was attributed to the 11.7 percent drop in cash remittances from landbased workers which offset the 6.0 percent increase in transfers from sea-based workers,” the BSP said.

The central bank noted there were reports that a number of global correspondent banks have closed their service facilities on money service business.

According to the BSP, the closure of money service business facilities reflect the increasing global trend to reduce correspondent banking relationships and focus more on home market.

“This may have partly affected remittances flows during the month,” the BSP said.

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

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

Last September 26, 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.

But despite the drop, Espenilla noted that OF remittances remained in a positive territory in the first three-quarters of the year.

Based on the BSP data, OF remittances stood at $20.78 billion at end-September, higher by 3.8 percent compared with $20.02 billion in the same period in 2016.

Cash remittances from landbased and sea-based workers grew by 3.8 percent and 3.5 percent between January and September to reach $16.4 billion and $4.4 billion, respectively.

Remittances coming from the United States, Saudi Arabia, United Arab Emirates, 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.

Meanwhile, personal remittances reached 23.2 billion at end-September, registering 4.8 percent year-on-year growth.

For 2017, cash remittances from overseas Filipinos are expected to expand by 4 percent to a record level of $28 billion from $26.9 billion last year.

The central bank earlier kept its remittance growth guidance for the year amid the diplomatic crisis in the Middle East as well as the immigration policy of US President Donald Trump.