go through Katherine K. Chen
Bangko Sentral Ng Pilipinas (BSP) said on Monday that Filipinos sent more money home in July as remittances from offshore workers increased by seven months than those from land-based workers.
Cash remittances through banks jumped from the same $3.085 billion a year ago to $3.179 billion in July, data from the central bank showed.
This marks the highest monthly remittance level since the $3.38 billion release last December.
In the month, the previous $2.987 billion remittances rose 7%.
“The Philippines continued to grow cash remittances in July this year, with overseas Filipinos (OFS) remittances slightly faster than those of land-based OFS funds,” the BSP said in a statement.
In July, money sent by land-based workers made up most of the cash remittances, a rate that rose 3% year-on-year to $2.59 billion.
Remittances from offshore workers rose 3.1% year-on-year to $585 million in July.
“As households gain higher peso value, the relative weakness of peso to the dollar also encourages higher remittances,” Ruben Carlo O. Asuncion, chief economist at Unionbank of the Philippines, said in a Viber message.
In July, the peso performed weaker in average P56.7523 per dollar from June’s P56.3586.
Reyes Tacandong & Co. Jonathan L. Ravelas, a senior consultant for Viber, said in a Viber message that remittance growth in July was also affected by the beginning of the school season, meaning that Filipinos (OFWS) sent money to their families to pay for tuition and school supplies.
Mr. Ravelas said global job stability could allow sea workers to send more money.
Mr Assen said the increase in remittances based on marine workers reflects “strong demand from the maritime industry, subject to stable global trade and cruise operations.”
“The higher dollar-denominated wages and new seafarers contracts contributed to this growth, which underscores the resilience of the industry and its role as a stabilizing force for the overall remittance inflow,” he said.
Meanwhile, personal remittances, including cash remittances through banks and informal channels and in-kind remittances, rose 3.1% to $3.53 billion from $3.43 billion in the same period last year.
Most individual remittances for the month came from workers on contracts of one year and more, totaling $2.81 billion, up 3% from the same period last year.
Those with less than one year contract sent $650 million, up 3.3% year-on-year.
Seven months
During the first seven months of the year, OFWS’ cash remittances rose 3.1% to $19.92 billion, up from $19.332 billion a year ago.
This is a 3.3% increase in remittances sent by land workers During this period, it reached $15.97 billion, while remittances from offshore workers increased by 2.3% to $3.96 billion.
Filipinos in the United States account for 40.3% of the total cash remittances sent between January and July.
Next is Singapore’s OFW (7.1%), Saudi Arabia (6.2%), Japan (5%), the United Kingdom (4.8%), the United Arab Emirates (4.4%), Canada (3.4%), Qatar (2.9%), Taiwan (2.8%) and South Korea (2.7%).
Individual remittances in the first seven months reached $22.22 billion, up 3.1% from $21.532 billion a year ago.
Mr Assen said the upcoming holidays will allow remittances in the coming months to sustain its growth.
“Looking forward, remittances are expected to maintain an upward trajectory over the coming months, supported by seasonal inflows from the ‘ber’ months and holiday seasons,” he said.
However, economists at United Bank also point out that global global economic uncertainty and policy changes pose risks to the country’s remittance growth.
“Nevertheless, overseas employment and competitive peso should help maintain a positive momentum,” he added.
BSP expects cash remittances to grow 2.8% this year to $35.5 billion.
