Trickle effect of seafarers’ remittances generates P1T for economy

The maritime and manning industries of the Philippines contributed P1.06 trillion to the national economy last year, according to a study by the University of Asia and the Pacific (UA&P) and the Association of Licensed Manning Agencies (ALMA Maritime Group).

The figure is about four percent of the country’s gross domestic product (GDP), UA&P economist Dr. Winston Padojinog said during the press conference presenting “The Overseas Seafarers’ Industry Profile, Structure, and Impact on the Philippine Economy” on Tuesday night.

“These remittances (of seafarers) go through the different sectors, but you have to also note that they are what we call industry multipliers, which means that for every peso they spend, it generates more than a peso after it goes through the different industries,” Padojinog explained.

Direct remittances from Filipino seafarers in 2024 reached P227.4 billion, which accounts for roughly 20 percent of all overseas Filipino remittances.

Foreign shipowners’ pre-deployment spending covering training, medical tests, accommodation and insurance added around P54.3 billion, which circulates within local industries.

“So, in summary, every time a Filipino sends one peso at home and is spent by the household, it becomes at least three pesos for the Philippine economy,” he said.

Padojinog said the maritime sector contributes to poverty reduction by raising family incomes. However, he cautioned that the Philippines risks losing its edge in the global seafaring market if the policy environment becomes unstable.

The country’s position as the top provider of maritime workforce, which was built through strong institutions and close partnerships between government and industry stakeholders, remains vulnerable with the low exit barriers of the sector that allow shipowners to move contracts elsewhere due to loss of confidence brought by unpredictable policies or arbitrary penalties.