Households with migrant workers buy more cars

MORE Filipino families that are dependent on remittances from relatives working overseas bought cars or houses in the second quarter, a central bank survey shows.

Rosabel Guerrero, director of the Bangko Sentral’s Department of Economic Statistics, said the percentage of households that used remittances to buy motor vehicles rose to 7.7 percent in the second quarter from just 7 percent a year ago.

This figure also represented an increase from the 6.6 percent of the households that bought cars in the first quarter.

Remittances, which represent about a 10th of the gross national product, support the growth of various segments of the economy including real estate, the automotive industry, transportation, finance, education, health care, retail and tourism.

Money sent home by Filipino workers rose 7 percent to $4.3 billion in the quarter through March, helping support the 7.3-percent expansion of the gross domestic product during the period.

A component of the second quarter Consumer Expectations Survey focused on the consumption pattern of the households dependent on remittances. The survey, conducted in April, had a sample size of 5,706 households, of which 570 or 10.4 percent were households with a member working abroad.

“Households [with migrant workers] utilize their remittances primarily for food, education, medical expenses, debt payments and savings in the second quarter,” Guerrero said.

But Bangko Sentral Deputy Governor Diwa Guinigundo noted a slight shift in the use of remittances in favor of vehicle acquisition and investments in the second quarter.

“It could be related to the impact of the two strong typhoons that hit the country late last year,” he said.

The percentage of migrant worker households buying houses also inched up to 11.9 percent in the second quarter from 10.8 percent a year ago, but eased from 15 percent in the first quarter.

About 96.3 percent of migrant worker households used remittances to buy food, while 64.2 percent used the money to finance education expenses in the second quarter.

The results of the survey also showed that 51.4 percent of the households were using money from abroad for medical expenses and 43.3 percent for debt payments. Those that used remittances to buy consumer durables were broadly steady at 27 percent.

Migrant worker households also used significant portions of remittances for savings, to buy the consumer durables and acquiire assets, Guerrero said.

However, compared to the previous quarter’s survey results, the percentage of households that allocated portions of their remittances to savings went down to 38.0 percent from 50.4 percent, while those households using remittances for investment increased to 7.2 percent from 5.8 percent. –Roderick T. dela Cruz, Manila Standard Today