Overseas Filipinos’ personal remittances sustain growth in November 2021 — BSP

Money sent home by overseas Filipinos continued its uptrend in November 2021, a month before the consumption-heavy Christmas season, data released by the Bangko Sentral ng Pilipinas (BSP) on Friday showed.

Central bank data showed that personal remittances — the sum of transfers sent in cash or in-kind via informal channels — stood at $2.77 billion in November last year, up 4.8% from the $2.643 billion recorded in the same month in 2020.

This brought the January to November 2021 personal remittances to $31.586 billion, up 5.3% in the first 11 months of 2021 from $29.988 billion in the comparable period in 2020.

“The increase in personal remittances in November was due to remittances sent by land-based workers with work contracts of one year or more, which grew by 6.3% to $2.137 billion from $2.01 billion in the same month last year, and sea- and land-based workers with work contracts of less than one year, which rose by 1% to $581 million from $575 million a year ago,” the BSP said.

Cash remittances — money transfers coursed through banks — amounted to $2.502 billion in November 2021, up 5.1% from $2.379 billion registered in the same month in 2020.

“The expansion in cash remittances was due to the increase in receipts from land-based and sea-based workers, which grew by 6.3% (to $1.968 billion from $1.852 billion) and 1.2% (to $534 million from $527 million), respectively,” the central bank said.

The January to November 2021 cash remittances grew by 5.2% to $28.43 billion from the year-ago level of $27.013 billion.

“The growth in cash remittances from the United States (US), Taiwan, and Malaysia contributed largely to the increase in remittances in January-November 2021,” the BSP said.

In terms of country sources, the US posted the highest share of overall remittances at 40.7% in the first 11 months of 2021, followed by Singapore, Saudi Arabia, Japan, the United Kingdom, the United Arab Emirates, Canada, Taiwan, Qatar, and South Korea.

“The combined remittances from these top ten countries accounted for 78.9% of total cash remittances during the period,” the BSP said.

In an emailed commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said overseas Filipinos’ remittances remain a bright spot for the Philippine economy.

Ricafort said some OFWs have already recovered or have their jobs restored “as the global economy re-opened and recovered further from the adverse effects of the pandemic lockdowns towards greater normalcy amid massive vaccination/booster doses vs. COVID-19.”

“OFW remittances and conversion to pesos are expected to have seasonally increased in fourth quarter especially in preparation for the Christmas holiday/spending season, as consistently seen for many years/decades, thereby could have supported faster growth in consumer spending, which accounts for at least 70% of the economy, and would also support GDP/economic recovery prospects, going forward, as a bright spot and a major pillar for the country’s economic recovery program,” he said. — VBL, GMA News