Philippines 4th among world’s top remittance recipients

MANILA, Philippines – The Philippines ranks as the fourth biggest recipient of remittances worldwide with an estimated $21.3-billion inflow this year, a new World Bank study showed.

The World Bank’s latest Migration and Remittances Factbook 2011 show that OFW remittances have been rising steadily from $10.24 billion in 2003 to $19.76 billion last year. Remittances accounted for 12 percent of the Philippines’ gross domestic product for 2009, the report said.

The Philippines trailed India ($55 billion), China ($51 billion) and Mexico ($22.6 billion) in terms of remittances received.

Other nations in the top 10 remittance-receiving countries are: France ($15.9 billion), Germany ($11.6 billion), Bangladesh ($11.1 billion), Belgium, ($10.4 billion), Spain ($10.2 billion) and Nigeria ($10 billion).

Overall, migrants sent a total of $325 billion to their home countries this year, up six percent from last year.

The report further noted that despite the weakening of the developed economies, the deployment of migrants increased, and along with the expansion of new markets, have helped deal with the struggling developed economies.

The report also showed that the Philippines ranked ninth in the world in emigrants, with a total of 4.3 million Filipinos out of the country. At least 51.1 percent of overseas Filipinos are female while only 13.7 percent of migrants finished college.

Mexico is the country with the greatest number of citizens working abroad with 11.9 million, followed by India with 11.4 million, the World Bank report said.

The report also showed that a total of 20,149 doctors or 17.5 percent of physicians trained in the Philippines have left the country for jobs abroad.

Top destination countries for Filipinos are the US, Saudi Arabia, Canada, Malaysia, Japan, Australia, Italy, Qatar, the United Arab Emirates and the UK.

World Bank lead economist Dilip Ratha said he expects remittances to developing countries to increase by 6.2 percent in 2011 and 8.1 percent in 2012. He, however, warned that the outlook for remittance flows could be affected by fiscal retrenchment in major destination countries in North America and Europe.

He also warned that movements in currency exchange rates and commodity prices can pose unpredictable risks for remittance flows.

“While a weaker US dollar can imply larger dollar-denominated remittances from Europe, it can also increase dollar prices of assets and goods in remittance-receiving countries such as India, Mexico and the Philippines,” he said.

Finally, he said stricter immigration controls imposed in response to high domestic unemployment rates could adversely affect migration and remittance flows.

Ratha said remittances in 2008 and 2009 became even more of a lifeline to poor countries, given the massive decline in private capital flows sparked by the crisis.

He noted that in addition to crisis-related risks, there are major structural and regulatory changes in the global remittance market. He said regulations to combat financial crime have become a roadblock to the adoption of new mobile money transfer technologies for cross-border remittances.

“There is urgent need to reassess regulations for remittances through mobile phones and mitigate the operational risks,” Ratha said.

The World Bank report also noted that the increased adoption of mobile technology for remittances have been experiencing roadblocks as nations are reviewing the process in order to curb financial crimes such as laundering. –Ted P. Torres (The Philippine Star)