THE amount of money sent home by overseas Filipino works (OFWs) reached $2.91 billion in March, the highest monthly remittance level on record.
The amount is expected to help bridge the country’s huge trade deficit.
Bangko Sentral ng Pilipinas (BSP) data showed personal remittances rose by 11.8 percent in March from $2.60 billion a year earlier. Remittances totaled $2.39 billion in February.
The remittances in March eclipsed the previous record $2.82 billion in December 2016.
For the first three months of the year, remittances reached $7.70 billion, up 8.1 percent from $7.13 billion a year earlier.
“The increase in personal remittances during the first quarter of the year was driven by the 10.5 percent growth in transfers from land-based workers with work contracts of one year or more, making up for the 2.0 percent decrease in remittances from sea-based and land-based workers with work contracts of less than one year,” the BSP said.
Personal remittances are transfers in cash or in kind, as well as capital transfers between households.
“I think the main takeaway from this is that we shouldn’t be too concerned about the trade balance being in the deficit, as the huge surplus from OFW flows will help to offset,” said DBS economist Gundy Cahyadi.
“Particularly true also because the trade deficit has been driven by strong import demand, more than anything else,” he added.
In the first quarter of 2017, the country’s trade deficit expanded by 19.2 percent to $6.54 billion from $5.48 billion a year earlier.
Cash remittances coursed through banks totaled $2.61 billion in March, up 10.7 percent from $2.36 billion. In February, cash remittances totaled $2.16 billion.
The BSP said remittances sent by land-based workers rose by 12.8 percent to $2.1 billion. Sea-based workers at sent $0.5 billion, up 3.1 percent.
The primary contributors to the growth in remittances during the month are the United States, Canada, United
Arab Emirates, Japan and Hong Kong.
Cash remittances rose to $6.9 billion the first quarter, up 7.7 percent from a year earlier.
Cash remittances from land-based workers grew by 10.4 percent to $5.6 billion, compensating for a 2.0 percent decrease in sea-based workers’ transfers to $1.4 billion.
The BSP said almost 80 percent of cash remittances in the first quarter of 2017 came from the United States, Saudi Arabia, UAE, Singapore, Japan, United Kingdom, Qatar, Kuwait, Hong Kong and Canada.