By Lee C. Chipongian
Cash remittances sent by overseas Filipinos went up by 3.1 percent year-on-year to $28.94 billion in 2018, slightly more than what the Bangko Sentral ng Pilipinas (BSP) projected of three percent flat growth for the full year.
Bank-transacted cash remittances had a lower growth in 2018 compared to 2017’s 4.3 percent because of lower fund transfers from the Middle East on account of repatriation issues.
According to the BSP, “cash remittances in 2018 remained strong amid political uncertainties across the globe. This is evident in Asia, the Americas, and Europe, which grew annually by 12.3 percent, 9.7 percent and 7.7 percent, respectively.”
The BSP said the growth in these regions “made up for the 15.3 percent decrease in remittances from the Middle East (partly due to the continued repatriation program of the government).”
About 79 percent of cash remittances came from these countries: US, Saudi Arabia, United Arab Emirates, Singapore, Japan, the United Kingdom, Qatar, Canada, Germany, and Hong Kong.
Remittances tagged as personal transfers, in the meantime, grew by three percent year-on-year to $32.21 billion, which the BSP said was the “highest annual level to date.”
The BSP said the growth in cash remittances was boosted by the growth in both land-based and sea-based overseas Filipino workers, which was up by 2.8 percent and 4.6 percent year-on-year, respectively.
As for personal remittances which are “the sum of net compensation of employees, personal transfers and capital transfers between households” and was first reported in 2012, the central bank said the growth was from inflows from land-based overseas Filipinos with work contracts of one year or more which increased by 2.8 percent. Both sea-based and land-based remitters with work contracts of less than one year also contributed significantly and increased inflows by 4.6 percent.
“Personal remittances is a major driver of domestic consumption and, in 2018, it accounted for 9.7 percent of gross domestic product and 8.1 percent of the gross national income,” according to the BSP.
For the month of December only, cash remittances rose by 3.9 percent year-on-year to an all-time high of $2.8 billion, with bulk of funds coming from the US and Canada.
Personal remittances increased by 3.6 percent year-on-year to $3.2 billion in December.
For 2019, the BSP is also projecting a modest three percent growth, same as in 2018.