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Personal Remittances Sustain Robust Growth in July 2014; January-July Level Reaches US$15 Billion

09.15.2014

Personal remittances from overseas Filipinos (OFs) rose by 7.1 percent year-on-year to US$2.3 billion in July 2014. On a cumulative basis, personal remittances reached US$15 billion in January–July 2014, up by 6.4 percent relative to the level registered in the same period last year, the Bangko Sentral ng Pilipinas announced today.1  The continued expansion in personal remittances during the first seven months of 2014 was mainly due to the steady increase in remittance flows from both land-based workers with long-term contracts (by 5 percent) and sea-based and land-based workers with short-term contracts (by 8.4 percent).

Likewise, cash remittances from OFs coursed through banks grew by 6 percent year-on-year to US$2.1 billion in July 2014.  This brought cash remittances for the period January–July 2014 to US$13.5 billion, higher by 5.8 percent than the US$12.7 billion recorded in the comparable period in 2013. In particular, cash remittances from land-based and sea-based workers rose by 5 percent (to US$10.3 billion) and 8.5 percent (to US$3.2 billion), respectively.  The bulk of cash remittances (about 79 percent) came from the United States, Saudi Arabia, the United Arab Emirates, the United Kingdom, Singapore, Japan, Canada, and Hong Kong. 

Remittances remained robust on the back of stable demand for skilled Filipinos abroad. Latest data from the Philippine Overseas Employment Administration (POEA) showed that for January-July 2014, job orders reached 540,037, of which 41.1 percent were processed job orders intended for service, production, and professional, technical and related employment in Saudi Arabia, the United Arab Emirates, Kuwait, Taiwan, and Qatar. 

Meanwhile, the continued efforts of bank and non-bank remittance service providers to expand their international and domestic market coverage through tie-ups and establishment of remittance centers abroad provided support to the sustained flow of remittances.

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1 The BSP started to release data on personal remittances in June 2012.  As defined in the 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., the provision of resources for capital purposes, such as for construction of residential houses, between resident and non-resident households without anything of economic value being supplied in return).

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