OFW remittances still on track to hit $31B

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Filipino seafarers' contributions to total OFW remittances continue to increase, augmenting diminishing land-based income from the Middle East. (Photo by maritime labour convention)

The chair of the House Committee on Banks and Financial Intermediaries today said that the remittances of overseas Filipino workers (OFW) remained on target to reach $31 billion based on Bangko Sentral ng Pilipinas figures.

Rep. Henry C. Ong noted remittance growth coming from countries where mostly OFW professionals, technicians, highly-skilled workers are deployed.

While remittances from the Middle East are waning, money transfers from Africa, Europe, the Oceania Pacific islands, the United States, Canada, and parts of Asia are on the rise, BSP said.

From January to October this year, remittances from Africa jumped 22.7 percent to $113.23 million from $92.3 million, it added.

“Much of what came from Africa, $57.85 million, came from Liberia and is sea-based. Many cargo ships are Liberian-registered. But money transfers from Nigeria, the Seychelles, and Egypt were in modestly strong amounts: Nigeria – $8.74 million; Seychelles – $2.01 million; and Egypt – $2.06 million,” Ong noted.

BSP data showed that Europe remittances grew by 8.7 percent to $3.44 billion from $3.16 billion, boosted mainly by earnings of Filipino seafarers whose ships are registered in the Netherlands, Norway, Germany and Cyprus, but with significant amounts also from land-based workers, mostly from OFW professionals (nurses and engineers), some farmhands, and some household service workers.

“The Philippines has only two state-funded maritime schools: the Philippine Merchant Marine Academy in Zambales and the National Maritime Polytechnic in Tacloban, Leyte.

“To further strengthen our position as a major maritime nation, I believe we should invest more in maritime education through the PMMA which should become a university and the NMP, converted into a state college,” Ong said.

Remittances from the Pacific island nations of the Oceania region were strong, increasing by 11.5 percent to $647 million from $580.4 million. Much of that came from New Zealand ($199.11 million; up by 88.8 percent) and from the Marshall Islands ($42.80 million; up by 44.4 percent) from sea-based OFWs. Transfers from Australia fell by 17.2 percent to $350.59 million from $423.35 million.

Over $10 billion in remittances came from North America-based overseas Filipinos. From the United States transfers totaled $8.2 billion and posted 6 percent growth, while from Canada money transfers amounted to $806.36 million and recorded 54.1 percent growth.

From Panama, remittances were $137 million up by 27.3 percent on account of Filipino seamen whose ships are Panamanian-registered. From Saipan, remittances were $20.45 million .

Five countries in Asia had strong remittance surges so far this year:

• Taiwan – $475.47 million (47.9 percent)

• Malaysia – $378.13 million (42.4 percent)

• South Korea – $274.44 million (21.8 percent)

• Vietnam – $60.78 million (21.4 percent)

• Macau – $101.63 million (20.4 percent)

Given the latest available official BSP data as of October this year, the total personal remittances of OFWs for this year remains on target to hit at least $31 billion, according to Ong.

“Considering that monthly OFW money transfers have not gone lower than $2 billion since February 2016 and worldwide, the OFW personal remittances already totaled $26.5 billion from January to October, the $31 billion mark is near certainty. Since the remittances always peak in December, there is even a high probability the $31 billion will be surpassed,” the Leyte second district congressman said.

In 2017, total OFW personal remittances hit $31.288 billion.

“So we could have a new record-high this year, but the country must not be complacent in the years ahead. As I have said before, remittances from the Middle East are on the decline,” the congressman pointed out.

Ong came up with policy recommendations to the executive department, as follows:

One, to convince OFW to invest a big chunk of their earnings in high-added value generating small business ventures, interest income-bearing securities, retirement savings, health care insurance, and quality education for their dependents—kids and adults alike.

Two, to have an Overseas Filipino Bank, a subsidiary of the Land Bank of the Philippines, with a much deeper and growing role in the investment decisions of OFW and their dependents.

Three, for the Philippines to forge OFW bridges with the strong economies of South America, Africa, and Eastern Europe.

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