Analysts are assessing the impact of the zero-remittance campaign that certain overseas Filipino workers (OFWs) groups have launched, even as it has yet to reflect on stock market prices.

An economist said since OFW remittances are a vital source of dollar for the Philippines. It is hard to estimate the impact of the reported protest action as it would depend on how representative it of total remittances.

A major source of remittances is the United States. In general, OFW remittances are around $3 billion a month. The effectiveness of the action can be measured against that.

Total remittances in 2024 reached $38.84 billion for the entire year. That breaks down to around $105 million per day on average.

Converted, the amount goes as high as P5.9 billion a day.

Bank of the Philippine Islands (Bpi) chief economist Jun Neri said if remittance inflows dry up substantially, economic growth could be dragged down since it’s a major driver of household consumption.

“The Bangko Sentral ng Pilipinas could also hike its policy rate for lenders if the peso-US dollar rate hits 60 per dollar,” according to Neri.

“Non-sending of remittances is a very big if. We don’t know the spokesperson who said this and if that plan is really representative of the OFW community. A lot of them work in the United States and we don’t know if they air this statement or are adequately represented,” according to the analyst.

“Personally I doubt that can happen, especially if the remittances pay for their children’s tuition fees.”

BPI strategist Marco Javier said, however, it will be hard to convince those who are paying amortizations for home and auto loans to suspend remittances. “Their credit standings might be put at risk.”

More debts feared

Making good of the threat will also increase the need for more dollar borrowings. “Our external debt is already more than $130 billion,” Javier added.

A remittance boycott by OFWs would undoubtedly disrupt the Philippine economy, with effects ranging from immediate household income losses to broader pressures on the peso and GDP.

A short-term action such as one week, would likely be a symbolic shock, painful but manageable, while a prolonged boycott could push the economy toward a deeper slowdown.

The real impact would hinge on participation levels and duration, but even a partial boycott would underscore the OFWs’ indispensable role in the nation’s economic fabric, according to an economist.