Petro dollars can’t save OFWs

Special Report: OFWs cope with crisis 
 
About two million Filipinos working in the Middle East will not be spared from the global financial crisis by petro dollars as oil-exporting countries post a mere 3.6-percent growth this year.

The figure is down from the 5.6 percent these countries posted last year, according to a report by the OFW Journalism Consortium, citing the International Monetary Fund (IMF).

“For the oil exporters, the decline in oil prices and Organization of Petroleum Exporting Countries [OPEC] production cuts are projected to reduce oil export receipts by almost 50 percent in 2009. This implies a loss of government revenue to the tune of $300 billion compared to 2008,” the IMF said.

The International Labor Organization (ILO) projects that if the unemployment rates in developed economies and in the European Union rise because of the global crisis, the Middle East’s unemployment rate may reach 11 percent—affecting eight million workers, including foreigners.

OFW remittances

According to the OFW Journalism Consortium—a group of journalists concerned about overseas Filipino workers—cumulative remittances last year from Filipino workers in 16 Middle East countries posted a 15.2-percent growth to $2.5 billion, or $3.3 billion higher than the previous year’s remittance of $14.4 million.

Land-based Filipinos sent $2.4 billion from January to December, according to the consortium, citing the Bangko Sentral ng Pilipinas (BSP).

Remittances from the United Arab Emirates (UAE), for example, posted a double-digit growth rate to $621 million, or $91 million more than what Filipinos sent back in 2007.

Only Qatar and Kuwait posted declines in remittances. Kuwait-based Filipinos sent home $125 million, or 25-percent less, while those in Qatar sent $133 million, or 7.5 percent less than in 2007.

There are about 139,803 Filipino workers in Kuwait and 195,558 in Qatar.

Remittance rates posted declines in six of 11 months last year, the biggest recorded in April (minus 23 percent) when world oil prices spiked nearly $100 a barrel.

The second-lowest month-on-month drop was recorded in October at nearly 18 percent, when world oil prices began tapering down up to $56.42.

Notably, the February 2009 cumulative year-on-year remittance level of 2.5 percent was the lowest in six years since 2003. The second lowest was in February 2004, when the level was at 5.6 percent.

This means that while remittances from an estimated eight million Filipinos in 190 countries was bigger at $2.6 billion in February this year, it was just an inch above the $2.2 billion posted in the same month last year, according to a report by the OFW Journalism Consortium.

The consortium cites eight countries that the Bangko Sentral ng Pilipinas lists as major sources of remittances for the first two months of the year of which two are in the Middle East: Saudi Arabia and the United Arab Emirates.

Last year, full-year remittances from Saudi Arabia posted a growth rate of 21.5 percent to nearly $1.4 billion, the largest among the 16 countries.

Mixed views

Some industry players offer mixed views on the impact of an impending slowdown in Middle East economies to Filipino workers.

The Philippine Overseas Employment Administration (POEA) reported that some 1,376,823 land- and sea-based overseas workers were deployed in 2008.

But last year, the country deployed lesser numbers of new-hire overseas workers to the Middle East with 203,572 (lower by 4.9 percent to the 214,360 deployed new hires in 2006), according to POEA data cited by the consortium.

On a per-country basis, comparing 2006 and 2007 figures of deployed new hires, deployment grew in Middle East destination countries such as Saudi Arabia (by 6,892 new hires), UAE (5,395 new hires) and Qatar (1,742 new hires).

Meanwhile, new-hire deployment dropped in Kuwait by 12,192 workers. — Paul M. Icamina, Manila Times