Pinoy remittances: Up or Down?

Repatriation programme pulls down OFW cash remittance figures
Gilbert P. Felongco, August 17, 2018 https://gulfnews.com/business/economy/repatriation-programme-pulls-down-...

Philippine Central Bank said UAE, Saudi Arabia and Kuwait registered the biggest declines in cash remittances from OFWs in June

otal cash remittances from overseas Filipinos for June fell by 4.5 per cent to $2.4 billion (Dh8.81 billion) compared to the same month last year, the Philippine Central Bank said.

The Bangko Sentral ng Pilipinas (BSP) or Philippine Central Bank, said the countries that registered the biggest declines in cash remittances from overseas Filipinos in June 2018 are the UAE, Saudi Arabia and Kuwait.

“The Overseas Filipino Workers (OFWs) repatriation programme of the government may have partly affected the remittance flows for the month,” the BSP said.

Although the Philippine government had initiated its own programme to repatriate its nationals who are classified as “overstaying,” the governments of UAE, Saudi Arabia, and Kuwait had implemented their respective programmes to amnesty overstaying workers, allowing some of them to return to their home countries.

“During the first two months of 2018, a total of 4,149 OFWs were repatriated from UAE, Saudi Arabia and Kuwait,” the BSP said although figures provided by the Philippine Department of Labour and Employment (DOLE) are much higher.

In Saudi Arabia alone, Labour Undersecretary Dominado Say said 5,299 Filipino workers were allowed to go home in June.

In Kuwait, nearly 500 Filipinos returned to their home country while the UAE is still continuing with its amnesty programme allowing some Philippine nationals to leave.

On the overall — to include those coming from countries such as the US, the UK, Japan, Qatar, Germany, Hong Kong and Canada — first semester of 2018 cash remittances from overseas Filipinos coursed through banks recorded a 2.7 per cent growth from the same period a year ago to reach $14.2 billion (Dh52.14 billion).

Cash remittances sent by overseas Filipino land-based workers and sea-based workers rose by 2.5 per cent and 3.4 per cent to $11.2 billion (Dh41 billion) and $3.0 billion (Dh11 billion) respectively.

Cash remittances up in 1st half despite June fall amid smaller Mideast flows
Melissa Luz T. Lopez, August 16, 2018 http://www.bworldonline.com/cash-remittances-up-in-1st-half-despite-june...

CASH remittances slipped to a two-month low in June due to smaller flows from the Middle East, the Bangko Sentral ng Pilipinas (BSP) reported on Tuesday.

Money sent home by overseas Filipino workers (OFWs) totalled $2.357 billion that month, down from May’s $2.469-billion inflows and 4.5% lower than the $2.467 billion received in June 2017.

This is the smallest amount of remittances seen since April’s $2.347 billion and settled lower than market expectations, according to central bank data.

ING Bank had expected remittances to rise by 5.3% in June, versus a consensus forecast of 5.4%.

The BSP said cash remittances declined on the back of smaller amounts sent by Filipinos working in the United Arab Emirates (UAE), Saudi Arabia and Kuwait.

“The overseas Filipino workers repatriation program of the government may have partly affected the remittance flows for the month,” the central bank said in a statement, noting that a total of 4,149 OFWs have been brought home from the three countries during the first two months of 2018.

In February, President Rodrigo R. Duterte asked Filipinos in Kuwait to return home amid reports of abuse, and ordered a deployment ban soon after. The ban was lifted in May following an agreement signed by the two nations.

June’s inflows brought last semester’s total to $14.179 billion, 2.7% more than the $13.813 billion logged in last year’s comparable six months. That compares to the central bank’s forecast of a four percent growth in remittances for the entire 2018.

Cash transfers from OFWs deepens pockets of their families back home, which in turn helps fuel overall economic growth. Household spending in proportion to national output steadied at about 56% last semester from a year ago, though growth of this segment slowed to 5.7% compared to the year-ago 5.9%, according to latest available data which the Philippine Statistics Authority released on Thursday last week.

Overall economic growth slowed to six percent last quarter, compared to a downward-revised 6.6% climb in the first three months.

Remittances also act as a counterweight to growing import payments that have been driving the country’s current account balance deeper into deficit, in turn making the peso weaker against the dollar.

The BSP expects remittances to touch a new all-time high and grow by another four percent this year, coming from the all-time high of $28.06 billion in 2017.

Preliminary data from the Philippine Overseas Employment Administration showed that OFW deployment has eased, with land-based workers dropping by 3.28% and those working at sea falling by 14.6%.

By country, the United States remained the biggest source of remittances last semester. It was followed by Saudi Arabia, Singapore, the United Kingdom, UAE, Japan, Qatar, Germany, Hong Kong and Canada, according to the BSP, noting that these countries accounted for more than 79% of total cash remittances in 2018’s first six months.

Sought for comment, Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, said “[t]he lower-than-expected 4.5% remittance [drop] may be temporary because we have seen this as well last year. We expect it to recover in the coming months.”

In 2017, remittances posted annualized declines in April (5.9%) and September (8.3%) but grew in the other 10 months.

Mr. Asuncion said he had expected a 5.4% growth in remittance inflows to around $2.6 billion for June.

Still, he said the softer increase in remittances had “minimal” impact on household spending, which eased to 5.6% during the second quarter from the 5.7% pace logged in January-March at a time of rising commodity prices. Such consumption had grown by faster 5.9% and six percent in last year’s first and second quarters, respectively.

Remittances shrank 4.5% in June
August 15, 2018

Money sent home by Filipinos working overseas shrank 4.5 percent in June from a year ago, after the government ordered the repatriation of workers suffering abuse in the Middle East.

Data from the Bangko Sentral ng Pilipinas showed that cash remittances fell to a three-month low of $2.357 billion in June from $2.467 billion a year ago. This followed a 6.9-percent increase in May this year and a 5.7-percent rise in June 2017.

The countries that registered the biggest declines in cash remittances in June were the United Arab Emirates, Saudi Arabia, and Kuwait.

“The OFW repatriation program of the government may have partly affected the remittance flows for the month. During the first two months of 2018, a total of 4,149 OFWs were repatriated from UAE, Saudi Arabia, and Kuwait,” the Bangko Sentral said.

Preliminary data from the Philippine Overseas Employment Administration also showed that the number of land-based workers deployed to other countries dropped 3.28 percent in 2017 to 1,614,674 million from a year ago.

The number of sea-based workers deployed in 2017 also fell 14.62 percent to 378,072 workers.

Personal remittances, which include non-cash items, fell 4.9 percent in June to $2.615 billion from $2.751 billion a year ago.

Data showed that despite the drop in June, total cash remittances in the first half grew 2.7 percent to $14.179 billion from $13.813 billion in the same period last year.

Cash remittances from land-based workers and sea-based workers rose 2.5 percent and 3.4 percent to $11.2 billion and $3 billion, respectively.

Personal remittances, including non-cash items, totaled $15.787 billion in the first six months, up 2.8 percent from $15.364 billion a year earlier.

Cash remittances from the United States, Saudi Arabia, Singapore, the United Kingdom, UAE, Japan, Qatar, Germany, Hong Kong and Canada accounted for more than 79 percent of total cash remittances in January to June.

Personal remittances from land-based workers with work contracts of one year or more grew 2.5 percent to $12.2 billion, while transfers from sea-based workers and land-based workers with short-term contracts increased 3.4 percent to $3.2 billion.

British banking and financial giant Hongkong and Shanghai Banking Corp. said remittances would likely recover in the months ahead after the government lifted the deployment ban to some countries in the Middle East.

President Rodrigo Duterte earlier ordered the repatriation of thousands of OFWs from Kuwait where they were allegedly maltreated. Duterte appealed to OFWs in Kuwait to return to the country after Kuwait expelled the Philippine ambassador for launching rescue missions for Filipinos abused by their employers in the Gulf state.

Remittances, which account for a tenth of the gross national income, hit a record $28.06 billion in 2017, up 4.3 percent from $26.90 billion in 2016.

The Bangko Sentral projected a 4-percent growth for remittances in 2018.