Personal remittances for the first five months of the year totaled US$9.3 billion, representing a 5.5 percent increase from the level registered in the same period last year, Bangko Sentral ng Pilipinas Governor Amando M. Tetangco, Jr. announced today.1 The steady expansion in personal remittances during the five-month period in 2012 was underpinned by the sustained growth in transfers from land-based Overseas Filipino (OF) workers with work contracts of one year or more (by 2.7 percent), as well as sea-based workers and land-based workers with short-term contracts (by 14.7 percent). For May 2012, personal remittances from OFs rose year-on-year by 5.2 percent to reach almost US$2.0 billion.
Meanwhile, remittances coursed through banks during the same period amounted to US$8.3 billion, higher by 5.3 percent relative to the level registered in the same period a year ago. Fund transfers from land-based workers increased by 2.8 percent to US$6.4 billion while those from sea-based workers grew by 14.6 percent to US$1.9 billion.
The major country sources of cash remittances from land-based workers for the first five months of the year were the U.S. (28.9 percent), Canada (10.1 percent), Saudi Arabia (7.6 percent), the United Arab Emirates (3.9 percent), Japan (3.4 percent), the United Kingdom (3.2 percent), and Singapore (3.1 percent).
The continued stream of remittances emanated from the strong global demand for professional and skilled Filipino workers. Preliminary data obtained from the Philippine Overseas Employment Administration (POEA) indicated that for the first half of the year, approved job orders reached 395,336, of which 29.1 percent consisted of processed job orders for service, production, and professional, technical, and related workers. The bulk of processed job orders were intended for the manpower requirements in Saudi Arabia, United Arab Emirates, Qatar, Kuwait and Taiwan. Another contributory factor to the favorable trend in remittances is the continued expansion of banks’ remittance network abroad through additional partnerships with foreign banks, money transfer operators and other remittance agents.
1 It may be recalled that the BSP started the release of data on personal remittances in June 2012. As defined in Balance of Payments Manual, 6th Edition (BPM6), personal remittances represent the sum of net compensation of employees (i.e., gross earnings of overseas Filipino (OF) workers with work contracts of less than one year, including all sea-based workers, less taxes, social contributions, and transportation and travel expenditures in their host countries), personal transfers (i.e., all current transfers in cash or in kind by OF workers with work contracts of one year or more as well as other household-to-household transfers between Filipinos who have migrated abroad and their families in the Philippines), and capital transfers between households (i.e., transfers of fixed assets and financial assets that arise from the migration of individuals from one economy to another).