Up only 0.5% as foreign employers’ currencies weaken vs dollar
Growth in personal remittances by overseas Filipino workers (OFWs) stalled in July to mark the slowest pace in six months, dragged by the depreciation of the foreign employers’ currencies against the US dollar.
Measured in dollars, the amount of OFW remittances to the Philippines in July reached $2.30 billion, up a slight 0.5 percent from $2.29 billion in the same month last year, data from the Bangko Sentral ng Pilipinas (BSP) released on Tuesday showed.
July marks the slowest growth pace in such remittances since January this year, when the increase was recorded at 0.2 percent. The July figure also lagged the year-ago growth rate of 7.3 percent.
“This was partly due to the depreciation of currencies in their [OFWs] host countries against the US dollar, which reduced the dollar equivalent of their remittances,” the BSP explained in a statement.
Despite this, continued demand for overseas Filipinos workers remained the key driver of sustained remittance inflows, it said.
Personal remittances consist of 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.
Cash remittances, or those coursed through banks, also rose at a minimal year-on-year rate of 0.5 percent in July to $2.08 billion from $2.07 billion in the comparative period.
7-month rise faster at 4.6%
Total remittances during the first seven months of 2015 grew 4.6 percent to $15.67 billion from $15 billion posted in the year-ago period.
A breakdown of remittances in January to July shows funds coursed through banks climbed 4.8 percent year-on-year to $14.16 billion.
Data from the central bank showed cash remittances from land-based and sea-based Filipinos reached $10.8 billion and $3.3 billion, respectively.
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 seven-month period.
The BSP said “efforts of bank and non-bank remittance service providers to expand their international and domestic market coverage through their networks of remittance business partners worldwide provide support to the steady remittance flows.”
Meanwhile, data from the Philippine Overseas Employment Administration showed 526,345 job orders were approved in the first seven months of this year.
Of the total job orders, 38.7 percent of those processed were intended for service, production, and professional, technical and related workers in Saudi Arabia, Kuwait, Qatar, Taiwan, and the United Arab Emirates.
In 2014, personal remittances set an all-time high of $24.96 billion, while cash remittances reached $24.34 billion.