MONEY sent home by overseas Filipinos posted double-digit growth in November from a year earlier, bringing the year-to-date tally above the full-year 2016 target set by the central bank.
The Bangko Sentral ng Pilipinas (BSP) said the increase in remittances largely came from land-based Filipino workers overseas. It listed the United States, the United Arab Emirates, Japan, Saudi Arabia and Qatar as the countries that contributed to the increase in total cash remittances.
“The increase in personal remittances was driven largely by the 7.8 percent expansion in transfers from land-based workers with work contracts of one year or more to reach $20.9 billion. This made up for the 3.6 percent decline in remittances from sea-based and land-based workers with work contracts of less than one year, totaling $5.5 billion,” the BSP explained.
Going forward, a private analyst said remittances will continue to grow in 2017, although at a slower pace due to sluggish global growth and as the number of Filipino overseas workers stabilizes.
18.4% jump breaches 2016 target
Personal remittances surged 18.4 percent to $2.44 billion in November from $2.06 billion a year earlier, BSP data showed on Monday.
The double-digit increase also reversed a 2.8 percent year-on-year decline in October, when remittances reached only $2.32 billion.
For the first 11 months of the year, remittances totaled $26.88 billion, rising 5.1 percent from a year earlier and surpassing the BSP target of $26 billion for full-year 2016.
Cash remittances coursed through banks totaled $2.21 billion in November, up 18.5 percent from $1.87 billion in November 2015. In October, cash remittances totaled $2.09 billion.
In the 11 months to November, cash remittances reached $24.34 billion, up 5.2 from $23.13 billion year-on-year, mostly from the United States, Saudi Arabia, United Arab Emirates, Singapore, the United Kingdom, Japan, Qatar, Kuwait, Hong Kong and Germany.
“The improving global economic conditions, particularly in the US, may have contributed to the overall growth in remittances,” the BSP said.
Chidu Narayanan, economist for Standard Chartered Bank, said he still expects to see positive but slower growth in remittances this year.
“We expect a slower pace of growth in overseas remittances as the number of overseas workers stabilizes, and as sluggish global growth and a strong Philippine peso affect their income,” he said.
Even so, he expects remittances to continue to add more than 6 percentage points to the country’s current account surplus as measured against gross domestic product in the medium term.
He gave no further details.
Personal remittances are transfers in cash or in kind, as well as capital transfers between households.