Remittance inflows improved last June but full-year growth is expected to contract by five percent this year due to the pandemic before recovering next year with growth of about four percent.
During the joint virtual briefing of the inter-agency Development Budget Coordination Committee and the National Economic and Development Authority, Bangko Sentral Deputy Gov. Francisco Dakila Jr. said the June 2020 remittance figures showed improvement.
BSP bank data show that cash inflows from overseas Filipino workers grew by 7.7 percent year-on-year in the sixth month this year to $2.465 billion from year-ago’s $ 2.29 billion.
However, full-year cash remittances declined by 4.2 percent to $14.019 billion against year-ago’s $14.638 billion.
Dakila said the June figures were better than the numbers in the previous three months.
Cash remittances last March contracted by 4.7 percent and it further slipped to 16.2 percent and 19.3 percent in the next two months.
He said inflows from land-based workers rose by 14.2 percent last June but those from sea-based workers declined by 13.1 percent.
He said these developments are “well within our projection of five-percent decline in remittances for 2020.”
For next year, remittances are projected to recover by “about four percent in line with the long-run trend for remittance,” he said.
“Note that if we contract by five percent this year then, it will still be a partial recovery by 2021. But nonetheless, these latest numbers are in line with our projections,” the BSP deputy chief said.
BSP officials have reiterated that the expected decline in remittances since this year is on account of the job losses among OFWs.
During the same briefing, Labor and Employment Assistant Sec. Dominique Tutay said about 500,000 OFWs have been repatriated and some 200,000 are still expected to come home until the end of this year “if the situation will not be averted soonest.”
Tutay said it is natural for countries to reserve jobs for their own citizens but demand for OFWs remains, specifically for those in the health and information technology sectors.
She added demand for doctors, nurses, radiologists, psychologists, and occupational therapists are high in Europe while demand for IT-skilled workers and construction workers are high in both Europe and the Americas, particularly Guam.
These opportunities are what make authorities optimistic for the recovery of the remittances next year.
On the local front, Tutay said the IT-business process management industry is opening opportunities for the displaced workers in the country and the OFWs.
She said the government is also providing grants to displaced workers and these have resulted in some positive outputs.
In the case of workers in the health sector, the lady deputy DolE chief said the “immediate response of the government is first (to) reserve our health workers for our local health system but we will not stop there”.
“We shall continue to balance between our national interest of protecting our nationals from harm and supporting the global health care system. We will continue to work as well with the Department of Health and other government agencies to assess supply and demand and the restrictions that we put in place, let it be noted, is only temporary,” she added.