Slower than 6.2% yr-earlier, gains pace from 0.2% in Jan
REMITTANCES by overseas Filipino workers (OFWs) picked up pace in February, growing 4 percent from a year earlier on the back of a steady deployment of OFWs, the Bangko Sentral ng Pilipinas (BSP) said.
BSP data shows OFW remittances reached $2.07 billion in February against $1.99 billion in the same month last year.
This brought the total remittances for the first two months to $4.08 billion, up 2.1 percent from the $4 billion recorded in the same period in 2014.
While remittances were higher in February this year than from a year ago, the rate of growth was still behind the 6.2 percent advance recorded in the same month last year although it was much faster than the 0.2 percent increase posted in January this year.
Personal remittances consist of the net compensation for land-based overseas workers with short-term (one year or less) contracts and all sea-based workers; personal transfers in cash or in kind between overseas Filipinos or longer-term overseas workers and their families in the Philippines; and capital transfers between households, such as funds for home construction.
Standard Chartered Bank said the recovery of remittances in February may be attributed to fewer holidays during the month compared with the previous month.
It added that remittance growth should remain stable but warned that these funds face near-term challenges. For instance, remittances from Asia have contracted on a year-on-year basis for three consecutive months, StanChart said.
Growth in remittances from Europe has also slowed for eight consecutive months, while remittances from the Middle East may also ease if low oil prices impact employment prospects and wage increases for overseas workers, it added.
Nonetheless, the bank said: “We expect remittance growth to improve as the year progresses.”
Meanwhile, cash remittances, or those coursed through banks, rose 4.2 percent year-on-year to $1.87 billion in February from $1.80 billion a year earlier.
A breakdown of remittances during the two-month period shows funds coursed through banks increased to $3.69 billion, or 2.4 percent over the amount sent in the same period last year.
The central bank noted that cash remittances during the period from land-based and sea-based Filipinos reached $2.8 billion and $900 million, respectively.
“The continued efforts of bank and non-bank remittance service providers to expand their international and domestic market coverage, and tie-ups abroad, as well as the introduction of innovations in their remittance products continued to provide support to the steady flow of remittances,” the BSP said in a statement released along with the figures.
The United States, Saudi Arabia, the United Arab Emirates, the United Kingdom, Singapore, Japan, Hong Kong and Canada were the major sources of the cash remittances for the two-month period.
In terms of overseas jobs, data from the Philippine Overseas Employment Administration showed that there were 164,525 approved job orders in the first two months of 2015.
“The steady deployment of OF workers remained a key driver in the sustained inflows of remittances,” the central bank said.
Of the total job orders, 26.5 percent were processed intended for service, production, and professional, technical and related workers in Saudi Arabia, Kuwait, Taiwan, Qatar and the United Arab Emirates.
In 2014, personal remittances set an all-time high of a total $24.96 billion, while cash remittances reached $24.34 billion.