OFW remittances seen to grow by over 3% this year

MANILA, Philippines – Dollar remittances from overseas Filipino workers may grow by more than three percent this year following the hefty dollar inflows that poured into the country in July, BSP Governor Amando Tetangco Jr. said yesterday.

The latest estimate is higher than the previous projection of a two to three percent growth for 2009 and the original forecast of a zero percent growth. In 2008, remittances hit $16.4 billion.

“As I said before, given the recent performance of remittance flows, the forecast of zero growth is looking very conservative. Based on the latest information, it is possible that the growth rate can exceed three percent,” he told reporters.

Tetangco said the level and quality of remittances are expected to improve on the back of banks’ efforts to capture more inflows.

“The government’s efforts to continue to diversify markets and destinations as well as banks’ moves to improve the reach and their offers to overseas Filipinos are helping to ensure that remittance flows will be sustained. As the skill sets of our overseas Filipinos and the global economy continue to improve, we should see both the level and quality of remittances grow even more,” the BSP chief said.

Remittances from overseas Filipinos rose to $1.5 billion in July from $1.4 billion in the same month last year, posting the highest year-on-year growth for 2009 at 9.3 percent, latest data from the BSP showed.

The July figures brought remittances in the first seven months of the year to $10 billion, up by 3.8 percent from the year-ago level, data from the central bank also showed.

However, despite the 9.3 percent year-on-year growth in July, the latest growth figures pale in comparison compared to the 24.6 percent increase recorded in July 2008 when remittances grew to $1.4 billion from $1.09 billion in July 2007.

Nevertheless, the BSP said remittances are expected to stay robust due to the efforts of banks and remittance centers.

Tetangco said the increase in the number of remittance centers abroad and the establishment of more tie-ups with foreign financial institutions have resulted in greater capture of remittances.

The aggressive marketing efforts of banks and non-bank remittance centers to provide enhanced financial services to cater to the various needs of overseas Filipinos are anticipated to further facilitate the flow of remittances, he added.

Major sources of remittances during the seven-month period were the United States, Canada, Saudi Arabia, U.K., Japan, Singapore, United Arab Emirates, Italy, and Germany. –Iris C. Gonzales (The Philippine Star)