Personal remittances from overseas Filipinos (OFs) totaled US$2.6 billion in September 2016, increasing by 6.3 percent year-on-year. On a cumulative basis, personal remittances in the first nine months of 2016 reached US$22.1 billion, higher by 4.7 percent than the level recorded in the same period last year, Bangko Sentral ng Pilipinas Governor Amando M. Tetangco, Jr. announced today.1 Personal remittances were comprised largely of transfers from land-based workers with work contracts of one year or more, amounting to US$17.2 billion. Meanwhile, compensation of sea-based and land-based workers with work contracts of less than one year (excluding their expenditures abroad) aggregated US$4.6 billion.
Cash remittances from OFs coursed through banks posted a 6.7 percent growth in September 2016 to reach US$2.4 billion. Top countries that contributed to the growth in cash remittances in September were the United States (US), United Arab Emirates (UAE), Japan, Qatar, Taiwan and Kuwait. Remittances from land-based workers increased by 11.9 percent during the month, compensating for the 10.5 percent decline in sea-based workers’ remittances. The declining remittances from sea-based workers may be attributed to stiffer competition in the supply of seafarers. A growing number of officers and ratings2 are recruited from East Asia (China and India) and Eastern Europe (Ukraine, Croatia, and Latvia).3
On a year-to-date basis, cash remittances totaled US$20.0 billion, representing a 4.8 percent increase from the comparable level last year. Land-based workers’ cash remittances grew by 7.1 percent to reach US$15.8 billion. Meanwhile, cash remittances from sea-based workers declined slightly by 2.9 percent to US$4.2 billion. Cash remittances coming from the US, Saudi Arabia, UAE, Singapore, the United Kingdom (UK), Japan, Qatar, Kuwait, Hong Kong, and Germany comprise 80 percent of the total cash remittances in the first nine months of the year.4
1 The BSP started to release data on personal remittances in June 2012. As defined in the Balance of Payments and International Investment Position 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 formation purposes, such as for construction of residential houses, between resident and non-resident households without anything of economic value being supplied in return).
2 “Ratings” are mariners without a certificate of competence
3 International Chamber of Shipping. http://www.ics-shipping.org/shipping-facts/shipping-and-world-trade/number-and-nationality-of-world's-seafarers
4 There are some limitations on the remittance data by source. A common practice of remittance centers in various cities abroad is to course remittances through correspondent banks, most of which are located in the U.S. Also remittances coursed through money transfer operators (MTOs) cannot be disaggregated by actual country source and are lodged under the country where the main offices of the MTOs are located, which, in many cases, is in the U.S. Therefore, the U.S. would show up to be the main source of OF remittances because banks attribute the origin of funds to the most immediate source.