Cash remittances sent by overseas Filipinos (OF) via the banking networks increased by 7.8 percent in July but January-July data still show a decline of 2.4 percent to $16.802 billion because of the COVID-19 pandemic.
The 2.4 percent year-to-date (YTD) decline is recorded both for the cash and personal remittances as of end-July.
Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said: “YTD total remittances contracted by 2.4 percent, lower than the BSP’s revised forecast of minus five percent this year.”
Diokno said the “lower actual decline is a huge departure from many pessimistic forecasts that OF remittances will plunge by not less than 20 percent this year as a result of the pandemic.”
The BSP is projecting remittances to decline by five percent this year because of the global public health crisis but they also said it will resume its normal annual growth rate of four percent in 2021 and 2022.
In July, cash remittances increased to $2.783 billion from $2.581 billion same time in 2019. “This growth was mainly due to the 12.6 percent increase in land-based workers remittances, but was slightly tempered by the 9.2 percent decrease in sea-based workers’ remittances,” said the BSP.
For the first seven months, these bank-channeled remittances declined by 2.4 percent to $16.802 billion from $17.219 billion same period last year. Cash remittances from land-based and sea-based workers continued to be lower than their levels in 2019 by 1.5 percent to $13.232 billion from $13.429 billion, and 5.8 percent to $3.57 billion from $3.789 billion, respectively, reported the BSP.
The BSP said personal remittances, in the meantime, also increased by 7.6 percent in July to $3.085 billion from $2.867 billion same time in 2019. As of end-July, personal remittances reached $18.658 billion which was 2.4 percent lower compared to $19.119 billion in 2019.
The BSP said personal remittances growth came from the 12.6 percent increase in remittances from land-based workers with work contracts of one year or more. Remittances from sea-based workers however dropped by 9.2 percent “due mainly to the repatriation of sea-based workers amid the ongoing COVID-19 pandemic.”
The BSP said the US — mainly because remittance centers’ correspondent banks are in the US – Japan, Singapore, Qatar and Taiwan continue to be top source of remittances and all registered growth, but they noted declines in countries such as Saudi Arabia, United Arabe Emirates, Germany, Kuwait and the United Kingdom. “The highest share to total OF remittances at 40.1 percent for January–July 2020 emanated from the US, followed by Singapore, Saudi Arabia, Japan, the UK, UAE, Canada, Qatar, Hong kong, and Taiwan. The combined remittances from these countries accounted for 78.9 percent of total cash remittances,” said the BSP