Remittances jump to $13B in 7 months

Although the macroeconomic indicators proved better than expected, the government kept the forecast remittance growth at 5 percent for the year, regulators said on Monday.

Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. bared this at the sidelines of the Philippine Economic Briefing, where he announced a recalibration of some of the better-known targets, such as the gross international reserves, or GIR.

“I think it would be more realistic to stick to the 5-percent growth target. Even if its growth is slightly above, this was not significantly above the forecast,” Tetangco told reporters.

This pertained to latest data showing personal remittances growing at an annual pace of 5.4 percent in July to $2 billion, helping push the seven-month aggregate 5.3 percent higher to $13.28 billion.

Helping push the remittances higher were robust flows from both land-based and sea-based overseas Filipinos sending back their foreign- currency earnings to beneficiaries in the Philippines.

“In terms of the growth rate, it may pick up but it will [likely] not pick up that much,” Tetangco said.

Forecast remittance growth this year took into account the slowdown in the US and the sovereign-debt crisis in countries making up the euro zone, where a significant volume of personal remittances originates.

Tetangco also announced a recalibration of the GIR given higher actual foreign-currency reserves already totaling $80.8 billion in the first eight months, exceeding the target of up to $78 billion for this year.

The surplus in the balance of payments, indicating far more foreign-currency earnings from trade, investments and transfers than the country was spending for them, stood at $4.5 billion in the first seven months.

This was almost double the expected surplus in the balance of payments this year of $2.6 billion.

The BSP said personal remittance passing through the various banks amounted to $11.94 billion at end-July, up 5.3 percent year-on-year.

In July alone, this grew by 5.4 percent to $1.81 billion.

The bulk of flows originated from the US, which accounted for 43.4 percent of total cash remittances, followed by Canada, which accounted for 9.6 percent.

Some 7.5 percent were sent from Saudi Arabia, 4.8 percent from the United Kingdom, 4.9 percent from Japan, 4.1 percent from the United Arab Emirates and 4 percent from Singapore. –JUN VALLECERA | REPORTER, Businessmirror