Remittances rise as ‘ber’ months start

Cash and personal remittances sent by overseas Filipinos grew by more than six percent to $2.65 billion in September from $2.49 billion in the same month last year, according to the Bangko Sentral ng Pilipinas (BSP).

Remittances usually pick up during the “ber” months as Filipinos abroad send more money to their loved ones ahead of the holiday season.

Personal remittances, composed of cash and non-cash items that flow through both formal or via electronic wire and informal channels such as money or goods carried across borders, increased by 3.6 percent to $24.64 billion in the first nine months from $23.71 billion in the same period last year.

The BSP said the growth in personal remittances during the nine-month period was driven by the 3.3 percent rise in remittance inflows from land-based overseas Filipino workers with work contracts of one year or more to $18.8 billion from $18.2 billion.

Remittances from sea-based workers and land-based workers with short-term contracts increased by 8.2 percent to $5.3 billion from January to September compared to $4.9 billion in the same period last year.

Likewise, cash remittances rose by 6.3 percent to $2.38 billion in September from $2.24 billion in the same month last year.

Remittances coursed through banks from landbased workers with contracts of less than one year went up by 9.1 percent to $2.4 billion from $2.2 billion.

As a result, cash remittances increased by 4.2percent to $22.19 billion in the first nine months of the year from $21.29 billion in the same period last year.

“By type of worker, cash remittances from land-based and sea-based workers increased by 3.2 percent to $17.3 billion, and eight percent to $4.9 billion, respectively,” the BSP said.

By country source, the US registered the highest share of total remittances during the nine-month period at 37.5 percent followed by Saudi Arabia, Singapore, United Arab Emirates, Japan, United Kingdom, Canada, Hong Kong, Germany

and Kuwait.

The combined remittances from these countries, the BSP said, accounted for 78.3 percent of total cash remittances from January to September.

The BSP has retained the growth target for both personal and cash remittances at three percent for this year.

Remittances usually fuel personal consumption, helping sustain a steady economic growth. The amount of money sent home by overseas Filipinos usually account for 10 percent of gross domestic product (GDP).

Strong inflows from remittances, earnings of the business process outsourcing (BPO) sector, as well as tourism receipts continued to boost the country’s gross international reserves (GIR).

It has also translated to a stronger peso that has recovered back to the 50 to $1 level after shedding more than five percent last year to 52.58 to $1 last year.

ING Bank Manila senior economist Nicholas Mapa said remittances have been able to provide the Philippines a stable source of foreign currency to shore up dollar liquidity and in turn boost peso purchasing power to help drive the engines of domestic consumption.