Gov’t sees minimal impact of COVID-19 on remittances

The Duterte administration expects the coronavirus (COVID-19) outbreak to have a minimal impact on remittances from Filipinos based overseas.

At a news conference in Malacañang on Monday, Cabinet Secretary Karlo Nograles said the government has lowered the remittance target for this year to $34.2 billion or an expansion by 2.2% from $33.47 billion.

Previously, the government pegged the remittance target at $34.5 billion or a growth rate of 3%.

“Nevertheless, this shall still breach another record high in overseas Filipino remittances,” Nograles said.

He also said the Labor department assured that remittances from other source countries such as the United States, United Arab Emirates and Saudi Arabia may help compensate for the possible slowdown in inflows from virus-stricken China Macau and Hong Kong.

“In terms of remittances, keep in mind that mainland China accounts for only 0.1% of total OFW remittances, while Macau and Hong Kong account for 0.4%, and 2.7%, respectively,” he said.

“And we are encouraged by historical data that shows that Philippine remittances have been resilient even in the face of global downtrends.”

According to the Bangko Sentral ng Pilipinas, personal remittances accounted for 9.3% of the economy, as measured by gross domestic product (GDP), and 7.8% of the gross national income (GNI).

Early this month, Socioeconomic Planning Secretary Ernesto Pernia said if the coronavirus threat persists for the entire year, it would only slash less than a percentage point from the GDP growth.

“[O]ur economic managers expect minimal impact from the COVID-19 outbreak in the agriculture sector, particularly on exports,” Nograles said.

“Our banana exports to China, for example, are not slowing down. While there were previous logistical issues during the Chinese Lunar New Year break, this was only a temporary setback, and our banana exports to China have returned to normal.”

The government kept its economic growth target at 6.5%-7.5% for 2020. —KG, GMA News